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National Exam > Chapter 6 > Flashcards

Chapter 6 Flashcards

1
Q

Hazardous substances

A

A variety of laws, state and federal, have been passed for environmental protection. Licensees must
be familiar with the nature of environmental problems and the laws and regulations that apply. Most
environmental regulation and enforcement on the federal level is through the EPA, the Environmental
Protection Agency

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2
Q

Hazardous substances include:

A
  • Lead
  • Landfills or waste disposal sites
  • Underground storage fuel tanks
  • Farming herbicides and pesticides
  • Asbestos
  • Radon
  • Mold
  • Greenfields
  • Greyfields
  • Brownfields
  • Water quality
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3
Q

Lead

A

is found in paint and pipes and soil. Use of the lead-based paint disclosure for all properties
built before 1978 is required by law. The buyer has the right to have the property inspected
for lead within 10 days of the effective date of the contract, and may terminate the contract
due to the results of the lead inspection within 14 days of the effective date by providing written
notice to the seller. The disclosure allows buyers to waive their right to a lead inspection.
Older homes may have lead plumbing. Lead is hazardous when eaten or when inhaled in dust
particles. There is no duty to remediate lead. A seller must keep a record/ copy of the disclosure
for at least three years from the sale date.

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4
Q

Landfills or waste disposal sites

A

when improperly constructed can lead to groundwater contamination.
Know locations, and disclose. Recommend water testing.

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5
Q

Underground storage fuel tanks

A

that are old, rusty, or leaking, can cause groundwater
contamination. Sometimes found on both commercial and residential properties, these are
commonly called USTs. Recommend water testing.

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6
Q

Farming herbicides and pesticides

A

are another source of groundwater contamination. Recommend

water testing.

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7
Q

Asbestos

A

is an insulating material. Problems arise in its removal. ACMs (asbestos containing
materials) can be friable, or easily crumbled. The resulting dust is extremely hazardous. A
seller’s only duty or obligation is to disclose the presence of asbestos. An asbestos abatement
plan outlines the control of asbestos in a property. Methods of abatement include removal,
encapsulation, and/or enclosure or sealing the area.

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8
Q

Radon

A

is a naturally occurring colorless and odorless gas produced by the decay of radioactive
materials in rocks under the ground. Radon enters homes through the foundations. Radon
mitigation plans can reduce radon levels through the installation of pipes and fans. Radon is
much more likely to exist in colder climates.

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9
Q

Mold

A

mold needs water, oxygen, nutrients and the right temperature to grow. Newer homes
with tighter construction can add to mold growth, hence the addition of ventilating fans in
wet areas. A source of nutrients for mold is paper - it is basically pre-digested wood. Therefore,
paper faced gypsum board (sheetrock) should never be used in shower or tub areas. Cement
board or mortar board in these areas will discourage mold growth.

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10
Q

Greenfields

A

land that has never previously been developed

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11
Q

Greyfields

A

land able to be redeveloped (empty Walmart)

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12
Q

Brownfields

A

land known to be hazardous - most likely a hazardous industrial site

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13
Q

Water Quality

A

can be graded to explain both condition and use. White or clear water is tap
water and potable (able to be used for drinking and food preparation.)

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14
Q

Grey water

A

is gently
used water from your bathroom sinks, showers, tubs, and washing machines. Greywater may
contain traces of dirt, food, grease, hair, and certain household cleaning products.

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15
Q

Black water

A

denotes wastewater from toilets, which likely contains pathogens.

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16
Q

Wetlands

A

are a link between land and water. The government defines wetlands as: an area where
water covers the soil, or is present either at or near the surface of the soil all year or for varying periods
of time during the year, including during the growing season. They are, therefore, often adjacent
to, or tributaries to navigable waters. The soil is often saturated. The EPA regulates many wetlands.
They are sometimes a habitat for endangered species, including plants and animals. An area of wetlands
can be called a mire, swamp, bog, pete, or marsh.

17
Q

Hazard and Flood insurance (FEMA)

A

the Federal Emergency Management Agency oversees the
National Flood Insurance Program (NFIP) in the United States. Flood-prone areas throughout the
country have been identified on maps prepared and researched by the Army Corps of Engineers.
Property located in the flood plain will be required to have flood insurance in addition to a homeowner’s
policy if federally related financing was used to purchase the property.

18
Q

Property Conditions and Environmental Issues

A
  1. Hazardous Substances
  2. Clean Air and water Acts
  3. EPA
19
Q

Clean Air and Water Acts

A

The Clean Air Act sets guidelines for emissions of hazardous
air pollutants. The Clean Water Act sets wastewater standards for industry. The Clean Water
Act applies to all navigable waters including adjacent wetlands. Both of these laws are
administered by the EPA. These laws have particular relevancy to the Oil and Gas industry,
and can be used to demonstrate EPA involvement with Oil and Gas leases.

20
Q

EPA

A

The Environmental Protection Agency is charged with administering all environmental
laws in the US. In addition to the laws mentioned above, the EPA administers
CERCLA – the Comprehensive Environmental Response, Compensation and Liability
Act that was passed in 1980, and created the Superfund to help pay for the cleanup of
hazardous spills and waste. Only Federal and State Regulatory Agencies and Indian Tribes
have the authority to spend CERCLA funds. CERCLA sets guidelines for the cleanup of
hazardous waste and spills. Past and present property owners are liable for cleanup. Anyone
who contributed to the problem must share the cost of cleanup.

21
Q

CERCLA

A

the Comprehensive Environmental Response, Compensation and Liability
Act that was passed in 1980, and created the Superfund to help pay for the cleanup of
hazardous spills and waste. Only Federal and State Regulatory Agencies and Indian Tribes
have the authority to spend CERCLA funds. CERCLA sets guidelines for the cleanup of
hazardous waste and spills. Past and present property owners are liable for cleanup. Anyone
who contributed to the problem must share the cost of cleanup.

22
Q

For commercial property, or any property where there is reason to believe there might be hazardous
materials on site, a ____ should be recommended

A

Phase 1 ESA

23
Q

Phase 1 ESA

A

This is an environmental site assessment
– a report prepared for a purchaser or owner identifying potential or existing environmental contamination
liabilities.

24
Q

For government projects a _____ will be done

A

Environmental Impact Statement (EIS)

25
Q

Environmental Impact Statement (EIS)

A

is done
to determine the effect of a project on the community. The report includes a detailed description of
the proposed project.

26
Q

A Seller’s Disclosure of property condition is used in many states.

A

The seller prepares a Seller’s Disclosure.
The seller is responsible for its accuracy. The agent’s role is to encourage honesty and full
disclosure

27
Q

Material facts that should be questioned and disclosed include:

A

• Land/soil conditions
• Pest infestation, toxic mold and other interior environmental hazards
• Structural issues – roof, doors, foundation, windows
Copyright © 2020 Champions School of Real Estate®
62
Chapter 6
Property
Disclosures
and
Environmental
Issues
• Condition of electrical and plumbing systems and fixtures
• Location within Natural Hazard or Specially Regulated areas – nuclear power plant, landfill,
flood plains, wetlands, endangered species, etc.
• Potentially uninsurable property
• Known alterations and additions

28
Q

Public Controls, Statutes and Public Utilities to be disclosed include:

A
  • Zoning and planning guidelines
  • School districts, Utility districts, Tax Districts
  • Homeowners’ Association membership / Property Owner’s Association membership
29
Q

Red Flag Issues

A

A “red flag” is defined as something that
would warn a reasonably observant agent that there may be an underlying problem. The listing agent
is required to mention this to the seller and any prospective buyers. Examples of red flags: Discolored
water bubbling up from under the ground at the site of a buried fuel tank; an iridescent sheen
on the surface of a pond.

30
Q

Liability considerations

A

The courts have decreed that it is a broker’s responsibility to discover
and disclose that there may be problems on a property. The broker’s responsibility is limited to areas
accessible for visual inspection. Errors & Omissions insurance can protect a broker if the seller misrepresents
property condition, the broker is unaware of the misrepresentation, and could not have
detected it by visual inspection

National Exam (8 decks)

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