Chapter 7 Flashcards
(89 cards)
1
Q
Will FHA insure a mortgage on a property that is subject to an encroachment?
A
Yes
2
Q
An easement that has both dominant and servient tenement is a?
A
Easement Appurtenant
3
Q
Is a fee simple estate limited by government powers of taxation, eminent domain, police power and escheat?
A
Yes
4
Q
Who does not have the right of survivorship?
A
Tenancy in comon
5
Q
Tenancy by the entirety is a form of ownership reserved for who?
A
Spouses
6
Q
A corporation or trust that functions like a mutual fund for real estate by combining the capital of many investors to acquire real estate?
A
Real estate investment trust
7
Q
How many owners does a property owned as tenancy in severality have?
A
One owner
Severality=severed
Severality /= several
8
Q
A study of the number of property units that can be sold or rented in the marketplace during a curtain period of time.
A
Absorption analysis
9
Q
Tangible or intanible aspects of a property.
A
Amenities
10
Q
Properties available in the marketplace that a buyer would accept as ready substitutes, since they share the same features and utility as the subject.
A
Competitive supply
11
Q
a group of people living in one unit of housing
A
household
12
Q
the study of economic conditions in an area
A
Market analysis
13
Q
a place where goods are exchanged, often between buyers and sellers.
A
Market
14
Q
a process that involves separating different users and different uses for property in the real estate market, focusing on real estate products on the supply side of the market.
A
Market Disaggregation
15
Q
a process that involves identifying and categorizing the various sub-markets that exsist within larger market, focusing on participants in the demand side of the market.
A
Market segmentation
16
Q
a means of determining the current position of the property in relation to the marketplace.
A
Productivity analysis
17
Q
a subject of the larger real estate market. appraiser defines to narrow and focus of market analysis; gather datea and anylized will produce accurate reflection. ( investers of single fam rentals, 2-4 units, high rise, apart buildings)
A
Submarkets
18
Q
driven by anticipation of future benifits; profit, pleasure. creates demand restrained by principle of substitution. residential is purchased emotionally; then justified logically.
A
segmentation
19
Q
driven by utility; property use, type, features. limitted by priciple of constribution. property is not worth more for enenimies if it’s not disired.
A
Dissagregation
20
Q
Study for certain market area is mostly performed using data sources (newspapers, planning commision reports) performed once for each area and updated pariodically.
A
Market Study
21
Q
A right or interest in property.
A
Estate
22
Q
Absolute ownership unencumbered by any other interest or estate. The fullest and most complete type of estate.
A
Fee Simple Estate
23
Q
3 Characteristics of a fee simple estate
A
Inheritable
Transferable
Perpetual
24
Q
The most common form of ownership encountered in real property appraisals
A
Fee Simple
25
Divided or undivided rights in real estate that represent less than the whole, i.e., a fractional interest such as a tenancy in common, easement, or life interest
Partial Interest
26
3 types of partial interests
Life estates, leased fee estates, and leasehold estates
27
Rights of use, occupancy, and control, limited to the lifetime of a designated party, sometimes referred to as the life tenant.
Life Interest
28
Example: an elderly person transfers ownership of a property to another party (often a relative) but retains the right to live in the property for the rest of his or her life. Upon the elderly person's death, the property transfers to the person who was named when the life interest was created.
What is this person called, and what is this an example of?
Person is the Remainderman
Example of Life interest/Life Estate
29
Is an adjustment to the value of a life interest property involving some sort of discounting of the value based upon mortality tables and the expected remaining life of the person holding the life interest permissible?
Yes. Uncommon, but can be done.
30
The ownership interest held by the lessor, which includes the right to receive the contract rent specified in the lease plus the reversionary right when the lease expires.
Leased Fee Interest`
31
The right held by the lessee to use and occupy real estate for a stated term and under the conditions specified in the lease.
Leasehold Interest
32
When a property is leased, it creates two separate estates or interests. Who do they belong to?
One belongs to the owner, other belongs to the tenant.
33
the value of the leasehold may be calculated separately from the leased fee ownership of the property itself if the property is...
Leased at the time of the sale
34
A leasehold interest is considered a
non-freehold estate
35
The right to use another’s land for a stated purpose.
Easement
36
An easement that benefits a legal person or entity (individual, corporation, partnership, LLC, government entity, etc.) and not a particular tract of land; an easement having a servient estate but no dominant estate."
Easement in gross
37
The right to perform a specific act on a property owned by another
Affirmative Easement
38
An easement preventing a property owner from certain, otherwise permitted, uses of his or her land, e.g., agreeing not to do something such as building a wall or fence blocking an adjoining property’s view.
Negative Easement
39
Negative easements can be punitive in nature and create losses in value. Examples of negative easements would include:
```
Conservation easements
Drainage easements
Historic preservation easements
Subsurface rights
Air rights
```
40
“An interest in real property restricting future land use to preservation, conservation, wildlife habitat, or some combination of those uses. A conservation easement may permit farming, timber harvesting, or other uses of a rural nature as well as some types of conservation-oriented development to continue, subject to the easement.”
Conservation Easement
41
The right to drain surface water from one owner's land over the land of one or more adjacent owners.
A drainage easement, or drainage right of way
42
A type of easement in gross that protects historically or architecturally significant properties by prohibiting or requiring review of future alterations or additions to protected features. When only some or all of the exterior surfaces and not the interior are protected, such an easement is often called a façade easement. The Internal Revenue Code allows a charitable gift deduction for the voluntary grant of qualifying historic preservation easements on some types of historic buildings.
Historic Preservation Easement
43
For real property, a personal, unassignable, and typically revocable privilege or permit to perform some activity on the land of another without obtaining an interest in the property.
License
44
Trespassing on the domain of another.
Encroachment
45
Who will insure a loan on a property that is subject to an encroachment if a perpetual encroachment easement is filed?
FHA
46
True or False? Fee simple estate is not limited by the governmental powers of taxation, eminent domain, police power, and escheat.
False
47
When appraising a property that is subject to a life interest, an appraiser is MOST likely to use
- a discount based on a mortality table
- comparable properties that are subject to conservation easements
- a discount based on the property's location
- comparable sales that are new construction, never occupied
a discount based on a mortality table
48
True or False? FHA will not insure a mortgage on a property that is subject to an encroachment.
False
49
When a property is leased, two separate estates are created.
True
50
```
A property has a market value of $300,000. The owner has a first mortgage of $200,000 and a second mortgage of $40,000. What is the market value of the fee simple estate?
$60,000
$100,000
$300,000
$540,000
```
$300,000
51
Mary Jones has a property with no road frontage. She has an access right of way across the property of her neighbor Bob Smith for ingress, egress, and regress. Who has the dominant tenement in this situation?
Mary Jones
52
Transferring real property of a person who has died without kin to the state
escheat
53
The holding of property by any form of title
Tenancy
54
3 types of concurrent ownership
Tenancy in common
Joint tenancy
Tenancy by the entirety
55
An estate held by two or more persons, each of whom has an undivided interest.
Tenancy in Common
56
Right to survivorship with tenancy in common?
no
57
Joint ownership by two or more persons with the right of survivorship.
Joint tenancy.
58
An estate held by a husband and wife in which neither has a disposable interest in the property during the lifetime of the other, except through joint action.
Tenancy by the entirety
59
A legal vehicle for partial ownership interests in real estate in which independently owned properties are conveyed to a trustee; may be used to effect a profitable assemblage or in some cases to facilitate the assigning of property as collateral for a loan.
Land Trust
60
A business arrangement in which two or more persons jointly own a business and share in its profits and losses
Partnership
61
An ownership arrangement in which all partners share in investment gains and losses and each has personal and unlimited responsibility for all liabilities
General Partnership
62
An ownership arrangement consisting of general and limited partners. General partners manage the business and assume full liability for partnership debt, while limited partners are passive and liable only to the extent of their own capital contributions.
Limited Partnerships
63
In law, an organization that acts as a single legal entity in performing certain activities, usually business for profit; also includes charitable, educational, and religious organizations
Corporations
64
A private or public partnership that pools funds for the acquisition and development of real estate projects or other business ventures.
Syndications
65
A corporation or trust that combines the capital of many investors to acquire or provide financing for all forms of real property.
Real Estate Investment Trust
66
You merely acquire ownership of shares of a corporation that owns the real estate. You do not receive a fee simple interest.
Co-op
| Cooperative
67
A form of ownership in which each owner of stock in a cooperative apartment building or housing corporation receives a proprietary lease on a specific apartment and is obligated to pay a monthly maintenance charge that represents the proportionate share of operating expenses and debt service on the underlying mortgage, which is paid by the corporation.
Co-op
| Cooperative
68
Martha wants to purchase a property with her three sons. She wants a 70% ownership interest, and her sons will each have a 10% interest. What form of ownership will best suit her needs?
Tenancy in common
69
The minimum characteristics of a PUD include:
A homeowner association that holds title to the common area
• Mandatory membership of all unit owners
• The right of unit owners to vote in the operation of the association
• Lien supported assessment of the members
70
"A limited interest in real property in which the purchaser receives only those rights specifically granted by the developer, usually the right to use a timeshare unit and the related premises; does not impart legal title to the property."
Nonfee timesharing
71
A multiunit structure, or a unit within such a structure, with a condominium form of ownership."
Condominium
72
A form of fee ownership of separate units or portions of multiunit buildings that provides for formal filing and recording of a divided interest in real estate.
Condominium Ownership
73
A type of building development designed as a grouping of complementary land uses, such as housing, schools, recreation, retail, office, and industrial parks, contained within a single master development; usually includes common area and common area maintenance obligations in the form of owners association dues.
PUD Planned Unit Development
74
Minimum characteristics of a PUD
A homeowner association that holds title to the common area
Mandatory membership of all unit owners
The right of unit owners to vote in the operation of the association
Lien supported assessment of the members
75
Joint tenancy has the right of survivorship. What does this mean?
- when a joint tenant dies, his/her share goes to his heirs
- when a joint tenant dies, his/her share goes to the surviving joint tenants.
- if all the joint tenants die at the same time, title to the property goes to the state
- when one joint tenant dies, the remaining joint tenants have smaller ownership shares as a result
When a joint tenant dies, his/her share goes to his heirs
76
What is a corporation or trust that functions like a mutual fund for real estate, by combining the capital of many investors to acquire real estate?
general partnership
land trust
syndication
REIT
REIT. Real Estate Investment Trust
77
What form of concurrent ownership allows a person to sell off their interest without the approval or knowledge of the other owners?
tenants by entirety
tenants in common
joint tenants
all of these
Tenants in common
78
A corporation or trust that combines the capital of many investors to acquire or provide financing for all forms of real property.
Real Estate Investment Trust
| REIT
79
What type of property ownership is characterized by the purchase of shares of stock in a corporation, which provides a proprietary lease to occupy an apartment unit?
PUD
condominium
cooperative
REIT
Cooperative
80
A leasehold interest belongs to the
mortgagor
mortgagee
tenant
landlord
Tenant
81
A remainderman is found in which type of estate?
fee simple
life interest
leased fee estate
leasehold estate
Life Interest
82
Which type of ownership can only be held by a married couple?
joint tenancy
tenancy in common
tenancy in severalty
tenancy by the entirety
Tenancy by the Entirety
83
Which is NOT a partial estate?
life interest
leased fee estate
fee simple estate
leasehold estate
Fee Simple Estate
84
Which ownership includes a right of survivorship?
joint tenancy only
tenancy in common only
tenancy in common and joint tenancy
joint tenancy and tenancy by the entirety
Joint Tenancy and tenancy b the entirety
85
“Type of building development designed as a grouping of complementary land uses, such as housing, schools, recreation, retail, office, and industrial parks, contained within a single master development; usually includes common area and common area maintenance obligations in the form of owners association dues” is the definition of
PUD
86
A leasehold interest may have value when
the contract rent is less than market rent
the contract rent is more than cash flow
there is a positive cash flow
the owner of record has equity in the property
The contract rent is less than market rent
87
```
A facade easement is a type of________________
easement
drainage
historic preservation
conservation
affirmative
```
historic preservation
88
A fee simple estate is NOT
inheritable
reserved for married couples only
transferable
perpetual
Reserved for married couples only
89
The most desirable form of timesharing is called ___________ timesharing.
nonfee
fee
title
warranty
Fee
