Course 1 Flashcards

Question

The right to live or work on a property

Answer 1

possession Ex. When Sally signed the lease on space for her new candy shop, she immediately took possession.

Answer 2

frontage Ex. The houses along Elm street received a special assessment for street improvements based on the frontage measurement of their lots.

Answer 3

mistake Ex. One of the ways in which a contract can be legally discharged is if it is entered into by mistake of the parties.

Answer 4

subordinate financing Ex. When Amity took out a home equity line of credit, her lender charged her a premium interest rate because it was subordinate financing, and in the even of a foreclosure, the home equity loan would be paid after her first mortgage.

Answer 5

prepaid items Ex. Bob had already purchased a winter's worth of heating oil when he decided to sell his house. The buyer, Jill, will reimburse him for the portion of the oil she'll use after she buys his house.

Answer 6

market price Ex. Market price is influenced by buyer demand and seller supply.

Answer 7

loft lease Ex. For his floral design business, Yves signed a loft lease on one of the new renovated warehouses downtown.

Answer 8

custodial maintenance Ex. As part of her duties, Layla had to arrange and monitor custodial maintenance for the properties she managed.

Answer 9

act of waste Ex. When Minerva inherited the historic mansion and turned it into an illegal video gaming parlor, this was an act of waste that caused her to lose title to the property.

Answer 10

government loan Ex. Both VA and FHA are types of government loans. They're not made directly to consumers, but are instead guaranteed (VA) or insured (FHA) by an agency of the federal government.

Answer 11

revitalization Ex. The neighborhood gains a renewed appeal for some reason, such as access to jobs or amenities, and the affordable prices allow people to purchase and renovate the homes.

Answer 12

assumption Ex. Nicole assumed Matt's loan payments when she bought his house.

Answer 13

exclusive right to sell Ex. To protect her commission, Amy always asked for an exclusive right to sell agreement when working with sellers.

Answer 14

stigmatized property Ex. Each state has its own laws regarding what stigmas licensees are required to disclose, and which they can keep mum about.

Answer 15

clear title Ex. Because the seller was unable to provide the buyer with a clear title, the buyer backed out of the sale, and received his earnest money back.

Answer 16

material defect Ex. The fact that the carpeting in the living room was an ugly lime green wasn't considered a material defect, but the leaky roof was.

Answer 17

escalation clause Ex. Jerome's escalation clause stated, "The buyer is willing to increase his offer to $1,000 over the highest offer received, with the purchase price limited to $245,000."

Answer 18

mortgagee Ex. ABC Bank was John’s mortgagee; they held the mortgage on his property.

Answer 19

principal Ex. Anita's principal payment was $200 per month. Her interest payment was $800 per month. As she paid on her mortgage loan over time, the amount that applied toward principal increased.

Answer 20

gross rent multiplier Ex. The GRM = Price divided by gross rent.

Answer 21

escrow disbursement Ex. Michelle's lender made an escrow disbursement of $547 to pay her annual hazard insurance.

Answer 22

studs Ex. When hanging heavy objects on a wall, it’s wise to nail the hanger for the object into the stud for security.

Answer 23

Clean Water Act Ex. Real estate transactions are impacted by this act when the property includes water features protected by the CWA (e.g., a buyer wants to build a guest cottage, but wetlands on the site prevent the plan from being implemented).

Answer 24

Insurance score Ex. The buyers' insurance score helped them choose the best homeowners policy for their new condo.

Answer 25

ministerial acts Ex. Keira helped a buyer fill in some of the blanks in their contract offer for her seller's house, but did not advocate for or advise them in any way.

Answer 26

blueprint Ex. Bradley looked up from the blueprint of his proposed house and told his architect, “I can’t visualize it in 2-D. Can you build me a model in 3-D?”

Answer 27

consumer Ex. A consumer may receive client-level service or customer-level service depending on the nature of their relationship with the licensee and to the transaction.

Answer 28

chain of title Ex. Karen’s chain of title showed no gaps in ownership since the time it was built.

Answer 29

reverse exchange Ex. Margo couldn't pass up on the amazinf deal she found on a condo downtown, so she closed on it quickly and then sold another property she owned in the suburbs so she could do a reverse exchange.

Answer 30

truss Ex. The truss system has for the most part replaced the rafter system in current construction, in part because its installation can usually be done in a day compared to a week for a rafter-type system.

Answer 31

enforceable contract Ex. Because the Smiths' contract to purchase a beach house had all of the typical nuts and bolts of a valid contract, it was considered enforceable in court.

Answer 32

chlorofluorocarbons (CFCs) Ex. Jane was surprised to learn that Styrofoam was a CFC product, and also that CFC is used in most car air conditioners.

Answer 33

non-judicial foreclosure Ex. Peach Orchard Bank was able to initiate a non-judicial foreclosure on a property when the buyer stopped making payments, which helped them avoid the extra time and expense of going through court proceedings.

Answer 34

floodplain Ex. Sam made sure to buy flood insurance for his new home, since it was located in a floodplain.

Answer 35

assemblage Ex. Through the princple of assemblage, by purchasing several adjoining parcels, the combined parcel was worth far more.

Answer 36

principal (loans) Ex. When paying off a home loan, the payment is applied toward interest on the loan and the principal, or amount borrowed.

Answer 37

asbestosis Ex. Asbestosis makes breathing difficult and can lead to death.

Answer 38

Small Business Liability Relief and Brownfields Revitalization Act Ex. The Brownfields Law protects buyers, lenders, and insurers from liability from clean-up costs of contaminated properties provided they were unaware of the issues, performed a Phase I environmental assessment prior to the purchase, and met other conditions.

Answer 39

Secure and Fair Enforcement Act (SAFE) Ex. The purpose of the SAFE Act is to provide additional protection for customers and provide anti-fraud measures.

Answer 40

liability insurance Ex. Keri’s liability insurance covered her when an open house visitor tripped and fell down the stairs, breaking his arm. The liability insurance paid for the visitor’s medical expenses.

Answer 41

point of beginning Ex. Sometimes, in a metes and bounds description, the point of beginning will be a humorous identifier such as ""Beginning where Standfield's donkey and goat always stand at the crest of the southmost knoll …""

Answer 42

supply and demand Ex. When supply is low, demand is high and price is high. When supply is high, demand is low and price is low.

Answer 43

group home Ex. The disabilities may be physical, developmental, or behavioral, and support services may or may not be provided to the individuals.

Answer 44

credit score Ex. A credit score is calculated from information in the borrower’s credit file, and is used by lenders to assess borrowers’ credit risk at a given moment in time.

Answer 45

reasonable skill and care Ex. Jason showed reasonable skill and care when he recommended to his client that he have an HVAC specialist inspect the furnace; it looked old and in need of repair.

Answer 46

operation of law Ex. Even though the recently deceased David bequeathed his home to his brother in his will, the operation of law mandated that the home would pass to David's wife, since the two of them owned the home in tenancy by the entirety.

Answer 47

subsurface rights Ex. In order for someone to extract oil from your property, you would have to lease or sell your subsurface rights.

Answer 48

probate Ex. To avoid probate, many people put all of their property in a trust.

Answer 49

equity Ex. After one year, Cameron's property had increased in value by 20%, and his equity went from $10,000 (his down payment) to $40,000 (the value after his loan balance).

Answer 50

condominium Ex. In a condominium ownership, the ownership is of the airspace the unit occupies plus an undivided interest in common elements.

Answer 51

partnership Ex. Common law regards a partnership as a group of individuals rather than a single entity.

Answer 52

water table Ex. Sheri found that her water table was actually 200 feet below the surface, making drilling for a well quite expensive.

Answer 53

common areas Ex. Homeowners pay dues to maintain the common areas of the association.

Answer 54

assessed value Ex. Although the appraised value of Myra’s bed and breakfast was $600,000, her tax assessed value was only $475,000.

Answer 55

emblements Ex. The Swansons grew wine grapes on their property, and when it was time to sell their vineyard, their latest plantings were considered emblements and were not part of the property price; these were sold separately to the buyer.

Answer 56

improvement Ex. Vacant land increases in value when improvements are added.

Answer 57

qualifying ratio Ex. Maurice applied for a home loan. He had to qualify both under the front-end and back-end ratios. He qualified on the front-end ratio, but his car payment put him over the limit for the back-end ratio.

Answer 58

aesthetic zoning Ex. Zoning required that all homes in Ocean City be either Victorian or Tudor in design, and no taller than three stories.

Answer 59

replacement reserve fund Ex. Because the homeowners association hadn't collected enough dues for the replacement reserve fund from the owners, when the roofs of the buildings needed to be replaced, each owner was assessed $1,800 to cover the costs.

Answer 60

reference to a plat Ex. The legal description of Hank’s new property was included on his deed by reference to a plat.

Answer 61

bankruptcy Ex. Individuals most commonly file Chapter 7 or Chapter 13 bankruptcy.

Answer 62

warranty Ex. The deed to Paul's new home included a warranty that there were no outstanding liens on the property.

Answer 63

preventive maintenance Ex. “A stitch in time saves nine” could be the slogan for preventative maintenance.

Answer 64

estate Ex. Rights of ownership in land are determined primarily on the type of estate held. A leasehold estate, merely gives the right of possession, where a freehold estate involves ownership.

Answer 65

title Ex. When the transaction between Karen and Vince is closed, Vince will have title to Karen’s property.

Answer 66

voluntary alienation Ex. When Craig sold his property to Yvette, this was an example of voluntary alienation.

Answer 67

building code Ex. The building code specified plumbing, electrical and structural specifications for builders.

Answer 68

adjustment Ex. Whether the adjustment is made for a “good” or a “bad” feature, it is made to the comparable, not to the subject.

Answer 69

wholesaling Ex. Now that Brent had been investing in real estate for a few years, he discovered his real knack was in wholesaling.

Answer 70

primary mortgage market Ex. Most home loans originated in the primary mortgage market end up as part of package of mortgages that are sold on the secondary mortgage market.

Answer 71

adjusted basis Ex. When Mark computed the adjusted basis in his property, he had to subtract $10,000 in depreciation he had taken over the years.

Answer 72

recorder Ex. The registrar of deeds is the recorder of real property transfers.

Answer 73

sphere of influence Ex. Beth knew that, to succeed in real estate, she should concentrate most of her marketing efforts on her sphere of influence.

Answer 74

online rental scam Ex. Keira created a Google Alert for the address of her new listing, so she'd be sure to see any fraudulent rental ads for it on the internet.

Answer 75

Sherman Act An 1890 act to protect the public from antitrust practices, such as monopolies or combinations that restrain trade Ex. The Sherman Act covers trade and commerce with foreign countries and between states (interstate) commerce.

Answer 76

drainfield Ex. It's important that drainfields are kept clear of trees or shrubs so that their roots don’t impede the filtered water from draining out of the septic tank.

Answer 77

Fair Housing Amendments Act of 1988 Ex. Families and persons with disabilities are now protected classes thanks to the Fair Housing Amendments Act of 1988

Answer 78

carbon monoxide (CO) Ex. Homes with gas appliances and gas heat should be equipped with carbon monoxide detectors which can warn the occupants to get out before escaping fumes result in serious health issues or death.

Answer 79

planned unit development (PUD) Ex. Shari lived in a condo in a PUD. She loved having shopping—and a hair salon—within steps of her front door.

Answer 80

collateral Ex. When Lance purchased a home using financing, he pledged his property as collateral. If he defaults on his loan, his lender can collect what it's owed by forcing a foreclosure sale on his home.

Answer 81

Uniform Residential Appraisal Report (URAR) Ex. The URAR includes sections to report all data collected for the appraisal, and the method used to arrive at a final opinion of value. Lenders require the URAR any time a property is bought or refinanced.

Answer 82

equitable title Ex. When a buyer purchases through a land sales contract, the seller holds the real title until the final payment is made. In the meantime, the buyer has equitable title.

Answer 83

building permit Ex. Builder Barry was issued a building permit to build a home on the empty lot next to his mother’s house.

Answer 84

reciprocity Ex. Due to reciprocity, Cindy, who was a broker in Connecticut, was able to perform real estate activities in New York.

Answer 85

license Ex. Gabby got a temporary license to install a political billboard on a farmer’s property.

Answer 86

framing Ex. Once the framing was in place, Martina could actually walk through her new house-to-be and get a good feel for what the finished product would be like.

Answer 87

R-factor Ex. The larger the R-factor, the greater the degree of insulation.

Answer 88

policies and procedures manual Ex. A good policies and procedures manual will also reinforce and define local, state, or federal laws and regulations applicable to daily real estate practice.

Answer 89

multi-family Ex. Multi-family homes with five or more dwellings are considered commercial residential properties.

Answer 90

active fraud Ex. "Sure, the foundation is perfectly safe!" Lisa said, even though she knew full well that there was a crack the size of Toledo in it.

Answer 91

lien Ex. When Marcus did not pay his contractor, the contractor put a mechanic's lien on Marcus's property.

Answer 92

condominium hotel, condotel, condo hotel Ex. Marissa investigated a condo at the Maui Banyan condotel. She liked the idea of having a registration desk, but found that financing was more difficult than with a traditional condo.

Answer 93

accounting Ex. Cameron accepted an earnest money deposit from his buyer. His duty of accounting means that he must safeguard the funds and handle them according to the agreement with his client and the policies of his firm.

Answer 94

eminent domain Ex. The new highway was going to cut right through a neighborhood; the government took the property for the highway, compensating the property owners at fair market value.

Answer 95

certificate of title Ex. The certificate of title is issued after a review of public records.

Answer 96

tenancy in common Ex. Bailey and her brother Bill inherited their uncle’s house. The will did not specify how they were to take title, so they were automatically made tenants in common.

Answer 97

REALTOR(R) Ex. Although often used generically, REALTOR(R) is a registered trademark of the National Association of REALTORS(R) and the term may not be used by non-members.

Answer 98

testate Ex. Because Rachel died testate, her last wishes were known by all.

Answer 99

pre-payment penalty Ex. Pre-payment penalties are all but eliminated under new lending rules.

Answer 100

biweekly mortgage Ex. Charlene made biweekly payments on her mortgage .She avoided the often expensive independent companies who offer to set up such payment plans for borrowers, and did it herself. She was able to pay off her 30-year mortgage several years early.

Answer 101

trustee's deed Ex. A trustee's deed is often by a trustee in bankruptcy to sell real property of the debtor.

Answer 102

closing agent Ex. Sandra was glad to learn that the closing agent for her sellers' closing was going to be Anders Hayes. He always had everything in order for a smooth closing, just as it should be.

Answer 103

offeror/offeree Ex. Sam, the offeror, offered Delilah, the offeree, $1 million for her oceanfront estate.

Answer 104

indirect cost Ex. Legal fees are indirect costs of construction.

Answer 105

agency law Ex. Agency law defines the rules of conduct of an agent to a client.

Answer 106

easement Ex. Easement is a non-possessory right to use another’s property. It does not involve ownership.

Answer 107

steep slope Ex. When building on steep slopes, flooding is often a consideration.

Answer 108

initial cap Ex. A loan has a margin of 2% and is based on an index, which is at 3%. The loan’s initial interest rate is 5%. The loan’s cap structure is 2/2/5. At the first adjustment, the index is at 4%, so the new interest rate is 6%. This is a 1% adjustment, below the initial cap of 2%.

Answer 109

security instrument Ex. A mortgage and a deed of trust are the two primary security instruments used when financing a home.

Answer 110

amortization Ex. A 30-year fixed rate loan provides amortization for the debt—in 30 years it is fully paid off.

Answer 111

step-up/graduated rent Ex. When Pat rented office space in the Peach Tree Office Park, he signed a 5-year lease, with the increases in rent each year laid out in the lease document.

Answer 112

lienor/lienee Ex. ABC Bank was the lienor who placed a lien on Jamie's property. Jamie was the lienee.

Answer 113

judicial foreclosure Ex. Georgia is not a judicial foreclosure state; the security deed, which is the most commonly used security instrument, provides for a non-judicial foreclosure in the event of buyer default.

Answer 114

individual development account (IDA) programs Ex. Part of Claire's job at the housing agency was to research and identify the best IDAs for their clients.

Answer 115

friable Ex. Asbestos that has aged often becomes friable; touching it at all may release dangerous fibers into the air.

Answer 116

floor area ratio (FAR) Ex. The floor area ratio can be used in zoning to limit the amount of construction in a certain area. For example, if construction must adhere to a 0.10 FAR, then the total area of all floors in all buildings constructed on the parcel must be no more than one-tenth the area of the parcel itself.

Answer 117

surface rights Ex. Ownership of surface rights do not include air rights or mineral rights; however, most homeownership rights include all three.

Answer 118

cease-and-desist order (advertising) Ex. Future actions after issuance of a cease-and-desist order may result in fines of up to $16,000 per ad per day.

Answer 119

municipal fees Ex. The municipal fees for the development cost the developer an extra $8,500.

Answer 120

commingling Mixing trust funds with business or personal funds Ex. Jack, a real estate broker, is in a hurry. He includes his client’s earnest money check into a deposit into his general business fund. This is commingling, and is illegal.

Answer 121

undivided loyalty Ex. Chip is Angelina's agent. She is about to make a terrible purchasing decision. Chip's duty of undivided loyalty means that he must put Angelina's interests ahead of his own, and tell her about the potential problems, even if it means losing a commission.

Answer 122

pitch Ex. The pitch of a Tudor style home is quite steep, and means reroofing can cost quite a bit more than a flatter roof.

Answer 123

subrogation (insurance) Ex. When the title company is forced to pay a claim against the policy, the covered parties give the title company permission to pursue the party who caused the loss. The covered parties are said to “subrogate” their rights to the title company.

Answer 124

return on investment (ROI) Ex. Corinne's commercial clients were strongly interested in their potential ROIs.

Answer 125

accessory use Ex. Andy’s military bunker in his back yard constituted an accessory use of the property.

Answer 126

mortgage-backed security (MBS) Ex. MBSs are considered more appealing on the secondary market if they conform to Fannie Mae/Freddie Mac guidelines.

Answer 127

passive fraud Ex. When seller Jose failed to disclose the crack in the foundation of the house he was selling, he was sued for passive fraud.

Answer 128

property management Ex. Ross performs property management services for his clients, like Marion Forks, and takes worries such as maintenance and tenant relations off her hands.

Answer 129

reconciliation (closing) Ex. A property prepared closing statement results in a reconciliation with equal balances on both side of the debit/credit columns.

Answer 130

pur autre vie Ex. Emma granted possession of her home to her nephew for the term of his mother's life, after which it would pass to her favorite charity, Cats and Canaries.

Answer 131

tax-deferred exchange Ex. If Jerome doesn’t identify a property with which to do a tax-deferred exchange, he will have to pay capital gains on the sale of his triplex.

Answer 132

joint tenancy Ex. Nell became nervous when three of the joint tenants in the commercial building she owned with Victor died under suspicious circumstances. She and Victor now shared ownership. Was she next?

Answer 133

triple net lease Ex. Charlene entered into a triple net lease with her landlord, so she'd pay the rent and any associated taxes, insurance, and maintenance costs for renting out the space for her nail salon.

Answer 134

gross domestic product (GDP) Ex. Business in Pottersville was booming, thanks to the upswing in the GDP.

Answer 135

addendum Ex. Steve decided to ask for the washer and dryer after all, so he asked his broker to write up an addendum to the sales contract.

Answer 136

title insurance Ex. Because title defects sometimes are not public record, and are not found in a title search, Vince purchased title insurance to protect his interests.

Answer 137

VOCs Ex. Concentrations of many VOCs are consistently higher indoors (up to 10 times higher) than outdoors.

Answer 138

insurable title Ex. A key concern is that sellers who offer insurable title instead of marketable title may not have to clear up title problems that come up before closing.

Answer 139

unity of person Ex. This form of ownership gives each spouse an equal, undivided interest in the property.

Answer 140

riparian rights Ex. Keri’s property bordered Tickle Creek. Keri fishes and wades in Tickle Creek, fully enjoying her riparian rights.

Answer 141

Treasury index Ex. Phil's adjustable rate mortgage was indexed by the Treasury bill yield. If the yield went up, his rates would rise at the next rate adjustment period.

Answer 142

condemnation Ex. When land is condemned through eminent domain, owners must be paid just compensation and provided with notice and an opportunity to defend their rights.

Answer 143

moratorium Ex. The city of Zippyville decided to put a moratorium on all future building until they could beef up their infrastructure to support a larger population.

Answer 144

payee Ex. When Rita wrote a check to her sister, her sister was the payee.

Answer 145

PITI (principal, interest, taxes, and insurance) Ex. To determine affordability, borrowers should figure out if the PITI payment each month is within their means.

Answer 146

net income Ex. Barry’s gross income was $50,000, but once he deducted for expenses, his net income was only $28,750.

Answer 147

percentage lease Ex. Angelina's Pizzeria gave a percentage of their profit to their landlord as a part of their percentage lease.

Answer 148

statutory redemption period Ex. If the borrowers pay the amount the property sold for, plus any accrued interest or costs, within the statutory redemption period, they can retain ownership of the property.

Answer 149

fraud Ex. Fraud can involve concealment or omission of material facts in order to induce a party to do or not do something.

Answer 150

errors and omissions (E&O) insurance Ex. E&O can be purchased from a commercial insurance provider for a relatively small annual fee, and may be used to cover legal costs in the event of a lawsuit.

Answer 151

appraised value Ex. Barbara refinanced her property two years ago. At that time, the appraised value was $450,000. If she puts it on the market today, she can't use the appraised value as list price, because it's no longer valid.

Answer 152

income-producing property Ex. Commercial, industrial, or residential properties leased to tenants create income for the property owner.

Answer 153

sales comparison approach Ex. Both licensees and appraisers use a sales comparison approach when arriving at an estimate of value.

Answer 154

tax shelter Ex. Because of his depreciation, which reduced his taxes, Scott was able to shelter some of his investment income and use that to make additional investments.

Answer 155

assumable mortgage Ex. When interest rates rise, buyers often prefer assumable mortgages at more favorable rates.

Answer 156

earnest money deposit Ex. Candace cautioned her sellers not to accept an offer that did not come with earnest money. “If the buyers are sincere,” she told her clients, “they will provide an earnest money deposit to demonstrate that sincerity.”

Answer 157

proprietary lease Ex. When Mary Lou applied became a member of Greener Grass Cooperative, instead of a deed to her unit, she received a proprietary lease to occupy the unit.

Answer 158

good consideration Ex. A parent can give a child a house without any payment from the child; although there is no exchange of ""consideration of value"" this is still considered good consideration by the courts.

Answer 159

no-cost loan Ex. Ruby found that her no-cost loan actually involves several thousand dollars in closing costs!

Answer 160

redlining Ex. Redlining is illegal under the Fair Housing Act; lenders must make loans based on the creditworthiness of the individual, and not the characteristics of property owners in a given geographical area.

Answer 161

BTU (British Thermal Unit) Ex. It takes 40 BTUs to cool one cubic foot of space.

Answer 162

special agent Ex. Real estate agents usually act as special agents to their clients; they assist with the sale but cannot sign contracts for the client or make decisions regarding the property independent of the client.

Answer 163

sky lease Ex. Instead of leasing, Donald Trump purchased outright the air rights above the historic Tiffany & Co. store on Fifth Avenue in New York City so he could build his famous Trump Tower next door.

Answer 164

mortgage REIT Ex. Alistair invested in both mortgage REITs and equity REITs.

Answer 165

personal property law Ex. Personal property law is addressed in the Uniform Commercial Code and covers items such as trade goods, minerals and timber.

Answer 166

collection Ex. Because Jewel didn't pay her credit card bill, the credit card company sent her bill to collections. Jewel now receives almost daily calls from the collection agency asking for payment.

Answer 167

statutory laws Ex. Posted speed limits are examples of statutory law.

Answer 168

Americans with Disabilities Act of 1990 Ex. The Americans with Disabilities Act requires landlords of properties covered under the Act to allow disabled tenants to make reasonable accommodations at their expense.

Answer 169

cost approach Ex. Appraisers often use the cost approach for new construction or for unique properties that do not have recent comparables.

Answer 170

comparables Ex. Shelly was careful in selecting the comparables for her CMA; she wanted them to be as similar as possible to the subject property.

Answer 171

long-term capital gain Ex. When Frankie and Dave sold their investment condo, they asked the buyer to postpone closing for two weeks, which would put them over the one-year mark, and allow them to pay long-term gains, rather than short-term gains, on the profits.

Answer 172

air lot Ex. Just as with land, the air above the land can be divided into air lots.

Answer 173

Homeowner and Equity Protection Act (HOEPA) Ex. HOEPA's high-cost tests require mortgage loans that fall into that category provide special disclosures and adhere to loan term restrictions.

Answer 174

loan servicing Ex. Although ABC Bank originated loans, it didn't service loans, and instead turned that responsibility over to City Lender.

Answer 175

owner participation Ex. Lenders want to see owner participation because it means the developer has some ""skin in the game.""

Answer 176

exclusive listing Ex. Jack had an exclusive listing with Mark to sell his apartment building. When Janice brought Mark a buyer, and the transaction closed, Jack earned the listing commission.

Answer 177

Mortgage Disclosure Improvement Act (MDIA) Ex. MDIA also stipulates that the only advance fee that a creditor can charge a borrower (before disclosing the terms of the loan) is a credit report fee.

Answer 178

balloon mortgage Ex. Jeb agreed to a balloon mortgage because he knew that in 5 years, when the balloon payment was due, he would have money available from his trust fund to pay it off.

Answer 179

option period Ex. When Zara and Clyde signed an option contract for Zara to purchase Clyde's vacant lot, they set the option period at six months.

Answer 180

dedication by deed Ex. Developer Dan formalized the green space transfer. His dedication by deed was appreciated by the city.

Answer 181

townhome (townhouse) Ex. Maurice loved his townhome. He had a small back yard and, fortunately, the neighbor who shared one wall with him was rarely home.

Answer 182

principal (agency) Ex. Mary is selling her house and is using Kamal as her listing agent. Mary is the principal in the transaction.

Answer 183

British Thermal Unit (BTU) Ex. It takes 40 BTUs to cool one cubic foot of space.

Answer 184

co-borrower Ex. Alice and Jimmy bought a house together. The applied for the loan as co-borrowers, and took title in both of their names.

Answer 185

mixed-use developments Ex. Tina lived in a mixed-use development. Below her apartment was a deli. She smelled salami all day long.

Answer 186

HUD-1 Ex. The HUD-1 form has been replaced by the Closing Disclosure for most residential transactions.

Answer 187

mutual mistake Ex. Elizabeth and Joe, the seller and buyer of a property, didn't realize that the home Elizabeth was selling was subject to ground rent.

Answer 188

plottage Ex. Plottage frequently results in an increase in value over what the individual parcels could sell for on their own.

Answer 189

monetary damages Ex. The court awarded Steve monetary damages when Becky intentionally ran over his golf clubs.

Answer 190

amendment Ex. Bill decided not to include the washer and dryer since the buyers were asking for the moon in the inspection. He wrote up an amendment to their original agreement, which they reluctantly signed.

Answer 191

building specifications Ex. While his wife pored over the blueprints for their new house, Bill preferred reading the building specifications, since they included his plans for an antique rose garden.

Answer 192

Coastal Zone Management Act Ex. The act encourages coastal states to develop and implement coastal zone management plans. This encompasses the 95,331 miles of the nation’s ocean and Great Lakes coastlines.

Answer 193

recording/recordation Ex. Ownership cannot be established until the deed is recorded.

Answer 194

liquid asset Ex. Lender's will look at a borrower's liquid assets to determine the borrower's ability to pay their mortgage in the event of a temporary loss of employment.

Answer 195

partial performance Ex. Although he met all other terms of the contract, Jeffrey failed to meet his contractual deadline; the other party could rescind the contract based on his partial performance.

Answer 196

zoning ordinances Ex. Zoning ordinances regulate things like lot size, building height, and permitted uses within each zoning classification on a zoning map.

Answer 197

open listing Ex. Dwight entered into open listing agreements with five brokers, knowing he'd only pay commission to the one who brought him a buyer.

Answer 198

savings and loan association (S&L) Ex. In 1955, Dr. Bennett took out a loan from his local S&L to buy a home for himself and his wife, Betty.

Answer 199

buyer's agent Ex. Because Sam was a buyer's agent, he owed undivided loyalty to the buyer.

Answer 200

highest and best use Ex. When Shane bought the farm property he knew its highest and best use would be realized by partitioning it; that, however was not his dream.

Answer 201

encumbrance Ex. Cathy was happy to see from the title report that the only encumbrance on the property she was buying was a power company’s easement in gross.

Answer 202

operating expenses Ex. Jan's operating expenses included maintenance and utilities for her fourplex.

Answer 203

plasterboard (aka wallboard) Ex. One of the messier jobs in construction is the installation of plasterboard, especially when a lot of cutting is involved—the plaster dust goes everywhere.

Answer 204

equity buildup Ex. After one year, Cameron's property had increased in value by 20%, and his equity went from $10,000 (his down payment) to $40,000 (the value after his loan balance). His equity buildup was $30,000.

Answer 205

Civil Rights Act of 1866 Ex. Although the Civil Rights Act of 1866 was enacted more than a century ago, it still has relevance and impacts discrimination laws today.

Answer 206

rate lock Ex. Jerome was concerned when closing was delayed. His rate lock was only good for another two weeks. What if rates rose? He might not be able to qualify for the loan!

Answer 207

base line Ex. Beginning at the initial point and the number 1 on a rectangular system grid, each township is designated as being a number of six-mile units (""Townships"") north or south of the baseline, and so many six-mile units (""Ranges"") east or west of the meridian.

Answer 208

real property law Ex. Real property law pertains to the purchase, sale, transfer, possession of an interest in real estate and all accompanying rights.

Answer 209

general lien Ex. When Fred sued his contractor, he won a judgment for a general lien against him.

Answer 210

voltage Ex. Power surges, which increase the voltage in your electricity lines, can be caused by lightning striking nearby, increasing the electric pressure by millions of volts (even a surge protector won't be able to save your computer in this case)

Answer 211

bylaws Ex. The Greener Grass Cooperative included in its bylaws the process for resolving shareholder disputes.

Answer 212

effective age Ex. Because the owner of the Babson Village building performed regular maintenance, the appraiser determined its effective age to be 10 years younger than its actual age.

Answer 213

Federal Reserve System Ex. Because Amazing Loan Company was not part of the Federal Reserve System, it did not have to adhere to its reserve or interest rate requirements. Borrowers beware--this lender might charge usury rates!

Answer 214

appraiser Ex. Vladimir the appraiser is certified to provide real estate appraisals for his clients.

Answer 215

material fact Ex. A material fact could impact the value of the property if the truth was known, or it could cause a seller not to accept a buyer’s offer (e.g., the buyer is actually not financially qualified to complete the transaction).

Answer 216

legally competent party Ex. The judge decided that Sylvia, who suffered from dementia, was not a legally competent party and therefore could not enter into a contract to sell her house.

Answer 217

certificate of deposit Ex. Georgio had some extra money in savings and decided to buy a five-year CD. Interest rates were higher than he could get in his savings account, and he had no use for the money for at least five years.

Answer 218

accrued items Ex. At closing, accrued items must be accounted for on the settlement statement. If the seller has accrued expenses not yet payable, the amount accrued will be a seller debit and buyer credit.

Answer 219

property manager Ex. Not all property managers deal with tenants on a daily basis. Some simply manage the profitability and safeguard the value of the building.

Answer 220

undivided interest Ex. Tenants in common have an undivided interest in the property. Although one person may own one-half, and another a third, and another a fourth, etc., each shares in the property as a whole.

Answer 221

growing equity mortgage Ex. A growing equity mortgage shortens the life of a loan and increases interest savings for the buyer.

Answer 222

Privity of Estate Ex. Both a landlord and a tenant have an interest in the same property since the landlord owns it, and the tenant lives in it.

Answer 223

sublease Ex. Randy is going on a European tour and decides to sublease his apartment, with his landlord’s approval. He subleases to Lisa, who pays Randy; Randy remains responsible for paying rent to the landlord.

Answer 224

footing Ex. The footing supports the foundation wall, and therefore the entire structure of the building.

Answer 225

Freon Ex. Freon is a non-toxic, extremely stable chemical substance used in most home air conditioning units.

Answer 226

mediation Ex. Brenda agreed to mediation, but when the mediator told her she should give the bicycle to Harry, Brenda refused.

Answer 227

littoral rights Ex. Cal’s property was next to a small lake, and he built a dock where he tied up a canoe in order to take advantage of his littoral rights.

Answer 228

reasonable time Ex. Parties may interpret this time differently, which can create issues and a possible claim of breach of contract. In this case, a court may determine a “reasonable time,” or it may consider the contract to be invalid because a specific time or date wasn’t provided.

Answer 229

periodic estate Ex. Kathy is leasing a house from Wes. It’s a six-month lease that will automatically renew for another six months unless either Kathy or Wes terminate prior to the automatic renewal.

Answer 230

closing Ex. At closing, buyer and seller reconcile expenses, prepaids and prorations; buyer provides seller with sales price and seller transfers ownership to buyer.

Answer 231

external depreciation Ex. Lance’s investment property diminished in value when a factory belching fumes 24x7 was built nearby. Because external obsolescence cannot be cured, this resulted in a significant loss on his investment.

Answer 232

Megan's Law Ex. Due to Megan's law, it was easy for a licensee to point concerned clients to appropriate resources to determine whether registered sex offenders lived nearby.

Answer 233

fee simple Ex. When Yvette was investigating condos in Hawaii, her friends told her, “Be sure to look for a fee simple. You don’t want a leasehold—you can’t pass that on, and it’s not worth as much.”

Answer 234

section Ex. A section is a square with mile-long sides and an area of one square mile (640 acres).

Answer 235

tax sale Ex. Licensee Kara helped her investor clients by searching tax sale properties that were going up for auction.

Answer 236

Farmer Mac Ex. Farmer Mac is not a direct lender,b ut instead works with lenders to increase availability of long-term credit at stable interest rates to rural America.

Answer 237

monument Ex. Jill read the metes-and-bounds description of her property, which included the location of an oak tree as a point of reference. This monument had been there for 150 years.

Answer 238

innocent misrepresentation Ex. Charlie told Randy that the house was in tax abatement area; this turned out to be wrong, but because Charlie had based that information on a reliable source, this was a case of innocent misrepresentation.

Answer 239

equitable distribution Ex. The court presumes that both spouses substantially contributed to the couple’s assets (e.g., income, property) while they were married. If either spouse is a homemaker, the court considers how that contributes to marital property. The court doesn’t consider marital indiscretions or misconduct when distributing property.

Answer 240

watershed Ex. Coastal areas that have heavy clay soil, shallow bedrock, and steep changes in incline are particularly sensitive to changes caused by development or landscape shifts.

Answer 241

designated agent Ex. Because she was a designated agent, Michelle represented only the seller in the transaction; her colleague, Tim, represented only the buyer in the same transaction, as the buyer's designated agent. Their broker Jill is a dual agent.

Answer 242

broker's price opinion (BPO) Ex. Chico's broker's price opinion (BPO) was prepared for XYZ Lending company on a potential foreclosure property.

Answer 243

community property Ex. Under the community property law, each spouse owns equal interest in shared property.

Answer 244

certificate of reasonable value (CRV) Ex. Because his certificate of reasonable value came in above the sales price, the VA was willing to guarantee the full sales price of George's home.

Answer 245

retaliatory eviction Ex. When Mark complained to the health department about the roaches his landlord wouldn't get rid of, the landlord threatened to evict him.

Answer 246

assignment (mortgages) Ex. Sima must not have been paying attention to her disclosures because she was surprised with EZ Well Bank assigned her mortgage to another lender.

Answer 247

duress Ex. Because Baba signed the contract under duress, it was voidable by her.

Answer 248

undisclosed dual agency Ex. Several states allow dual agency (representing more than one party in a transaction), but undisclosed dual agency is illegal in all 50 states.

Answer 249

family Ex. A family as defined by the courts, does not necessarily have to be related by blood.

Answer 250

conditions, covenants, and restrictions (CC&Rs) Ex. Robby made sure to check the CC&Rs before purchasing his condo. He wanted to make sure his pet iguana, Elvis, would be welcome.

Answer 251

estate for years Ex. Carmine agreed to rent Bill’s apartment for 11 days, after which their lease terminated. This is an estate for years, even though it is only for 11 days.

Answer 252

infrastructure Ex. Because of inadequate infrastructure, a two-year moratorium on new developments was enacted by the planning board.

Answer 253

residential office Ex. Because Tiffany lived and worked in a residential office building, she never had to worry about getting caught in the rain on the way to work; her office was just a short elevator ride from her apartment on the 7th floor.

Answer 254

title commitment Ex. A title commitment is issued after a detailed title search uncovers any outstanding liens, mortgages, or other title defects that would prevent the title from transferring clearly.

Answer 255

interest (financing) Ex. Annual interest on a loan can be determined by multiplying the rate of interest by the principal balance.

Answer 256

marital status Ex. Marital status is a protected class in some localities.

Answer 257

limited agent Ex. An escrow officer is a limited agent to the parties in a transaction.

Answer 258

real property tax rate Ex. Multiply assessed value by tax rate to compute annual property taxes.

Answer 259

eviction Ex. Mona hasn't paid her rent in months, so her landlord, Ewan, took her to court and won the eviction rights.

Answer 260

provenance Ex. The guitar's provenance as once belonging to Chuck Berry drove up its price substantially at the charity auction.

Answer 261

fascia Ex. The fascia is a board, either 1”x6” or 1”x8” that is perpendicular to the soffit. Gutters are attached to the fascia.

Answer 262

trigger term Ex. Trigger terms require disclosure of all terms to include: the cash price of the home, the amount of the down payment required or that none is required, whatever is applicable, the number of payments necessary to repay the loan, the amount of the payments, due dates or period of payments scheduled to repay the debt, the APR of the finance charge.

Answer 263

possessory Ex. All homeowners have possessory rights to their property.

Answer 264

replacement cost/replacement cost new Ex. Jason, whose mid-century Modern home was destroyed by fire, wished his insurance covered replacement cost. Unfortunately it only paid out the actual cash value, which wasn’t enough for him to rebuild a similar structure.

Answer 265

bargain and sale deed Ex. Clancy purchased a property from his aunt that had been unused for a long period of time. Because his aunt knew nothing about the property, the deed he received was a bargain and sale deed.

Answer 266

fee simple absolute Ex. When Yvette was investigating condos in Hawaii, her friends told her, “Be sure to look for a fee simple. You don’t want a leasehold—you can’t pass that on, and it’s not worth as much.”

Answer 267

Foreign Investment in Real Property Tax Act of 1980 (FIRPTA) Ex. Because the seller was from Canada, FIRPTA applied, and the buyer of the property was required to withhold a percentage of the sales price to ensure payment of taxes owed.

Answer 268

reliction Ex. Thanks to the receding of the lake, Sammy was now the proud owner of another three feet of mud.

Answer 269

progression Ex. David's neighbor put in new siding, new windows and a new walkway. Although David didn’t like the noise from the construction project, he loved the increase in his value. ""Progression is a beautiful thing,"" he told his spouse.

Answer 270

pro forma Ex. Ray wanted to see the effects of different financing options for a new investment. His accountant prepared a pro forma statement with projected balance sheets, income statements, and statements of cash flows.

Answer 271

ethics Ex. With certain exceptions, there is no external punishment for an ethical breach, as there is for breaking a law.

Answer 272

Housing for Older Persons Act of 1995 Ex. ""55+"" communities are exempt from familial status discrimination as long as at least 80% of their occupied units have at least one person aged 55 or older residing in them.

Answer 273

cost of funds index (COFI) Ex. , and advances of financial cost of funds index (COFI) represents the weighted average cost of savings, borrowings of certain financial institutions.

Answer 274

adverse material fact Ex. When Chet learned that a railway was being built behind the property, he withdrew his offerr. That was an adverse material fact he couldn’t live with.

Answer 275

depreciation Ex. After factoring in the depreciation of the building, the appraised value was lower.

Answer 276

referee's/sheriff's deed Ex. Jan was a real estate investor who frequently purchased foreclosures. Due to the uncertain ownership chain, she often received referee’s deeds, without warranties or covenants.

Answer 277

voluntary lien Ex. Scott’s mortgage was a voluntary lien against his property.

Answer 278

reproduction cost Ex. When evaluating insurance, be sure to check if you're covered for replacement cost or reproduction cost, particularly if the property is of historic value.

Answer 279

legatee Ex. When great-uncle Mauritius finally died, his legatees gathered in great anticipation to hear the reading of the will.

Answer 280

right of first refusal Ex. Clarisse loves the Victorian house owned by her elderly neighbor, Grace. She knows that at some point, Grace will need to go into assisted living. Clarisse asks Grace for the right of first refusal, and Grace agrees. When it’s time for Grace to sell, if Clarisse cannot buy her property, Grace may offer it to other purchasers.

Answer 281

cloud on title Ex. Erica was in the process of buying a foreclosure property, when an unknown lien cropped up, creating a cloud on the title. The lien had to be removed before Erica could buy the property.

Answer 282

conversion Ex. Joanne engaged in conversion when she borrowed money from her brokerage's escrow account to pay her rent.

Answer 283

soffit Ex. The soffit can be the underside of any construction element, although it is commonly used to mean the area under the roof extension.

Answer 284

multiple listing service (MLS) Ex. Chad has a new listing for a property in his town. One way he markets this listing is through the multiple listing service (MLS). By promoting the property on the MLS, Chad is exposing the property to all MLS members, the general public (such as unlicensed assistants who have permission to access MLS, and any sites that pull from the MLS “feed.”

Answer 285

piggyback (split) loan Ex. Evan has saved $30,000 for a down payment, which isn't quite enough to avoid paying PMI on the loan for his new $200,000 condo. So he gets a piggyback loan to make up the difference.

Answer 286

chattel Ex. You might confuse your buyers if you asked them, “Was there any chattel of the sellers you wanted to write into the sales contract?” It’s better to use the term “personal property.”

Answer 287

disability or handicap Ex. Because of her disability, Megan was allowed to have an assistance animal in her apartment.

Answer 288

accession Ex. Jonathan’s property borders a bay. The bay receded, and Jonathan gained an extra 10 feet of property to his land through accession.

Answer 289

periodic cap Ex. At Sylvia's next loan adjustment, the index is at 8%, which would put her new rate at 10%. This is more than the periodic cap of 2%, so the adjustment is set at the capped rate of 2% more than the previous rate, making it 8%.

Answer 290

nondisturbance clause Ex. When Elena received a foreclosure notice on the door of the house she was renting, she called her attorney to see if the mortgage in question contained a nondisturbance clause, meaning her lease would be honored.

Answer 291

due-on-sale clause Ex. Mortgages with due on sale clauses are not assumable.

Answer 292

incurable depreciation Ex. The Bakers had to live with the incurable depreciation of their split level designed home. Even though the design was no longer popular, it was an incurable depreciation they had to face. Fixing it would cost more than they could recoup at sales time.

Answer 293

non-possessory Ex. Because Sheena had an easement to cross Barb’s property, but no right to occupy the property, she had a nonpossessory right.

Answer 294

primary market Ex. Most home loans originated in the primary market end up as part of package of mortgages that are sold on the secondary market.

Answer 295

Consumer Price Index (CPI) Ex. The CPI showed that gas prices had risen 10 cents per gallon in the month leading up to Memorial Day.

Answer 296

straight-line loan Ex. With a straight-line loan, the amount of each payment changes, and the borrower makes higher installment payments at the beginning of the loan when the loan balance is higher and more interest is due. Over time, the amount of each installment payment lowers the outstanding balance.

Answer 297

estate at sufferance Ex. Bradley’s lease was terminated lawfully but Bradley refused to leave. He is not a trespasser, even though he is not there legally; he has an estate at sufferance.

Answer 298

International Codes® (I-Codes®) Ex. As a custom home builder, Janice made certain she always complied with not only I-Codes®, but also her state and local building codes.

Answer 299

cash-out refinance Ex. Interest rates had dropped, and Avril decided to refinance his home, which had a loan balance of $200,000 but an appraised value of $260,000, at $240,000. He used the $40,000 to pay off his car and credit cards, and ended up saving several hundred dollars each month. However, his new loan balance was now higher, and his payback term reset at 30 years.

Answer 300

navigable water Ex. Private homeowner use of navigable water is necessarily limited as compared to non-navigable water.

Answer 301

depreciable basis Ex. The depreciable basis of an investment property excludes the value of the land it sits on

Answer 302

walk-through Ex. Evelyn was very eager to do the final walk-through of her new townhome before she bought it; a fireplace was on her list of ""must-haves"" and it wasn't working at the home inspection. She was eager to see if the required repair had been made.

Answer 303

tenancy by the entirety Ex. Often, the default estate when a married couple purchase a property is tenancy by the entirety.

Answer 304

assessment Ex. Before a condominium owner can close on a sale of the condo, the owner must bring all assessments up to date so the buyer is not left paying for assessments owed from the time the seller was in possession.

Answer 305

Home Mortgage Disclosure Act (HMDA) Ex. Congress believed that blighted areas were caused in part because financial institutions failed to provide adequate home financing to qualified applicants at reasonable terms and conditions. HMDA requires financial institutions to provide the public with information that demonstrates its actions in serving the housing credit needs of their communities.

Answer 306

government-sponsored enterprises (GSEs) Ex. GSEs are not government entities, but are backed by the U.S. government.

Answer 307

valuation Ex. Appraisers arrive at a valuation by applying a specified set of criteria.

Answer 308

Freddie Mac Ex. Because Fannie Mae and Freddie Mac guarantee payments int he event of buyer default (for a fee), investors don't have to worry about credit risk. However, participating lenders must adhere to FNMA and FMAC financing guidelines.

Answer 309

bond market Ex. ABC Lending watched the bond market. When yields rose, it knew interest rates would soon do the same.

Answer 310

sub-agent (or subagent) Ex. Carol was a sub-agent of Jennifer, the seller, although Jim was Jennifer's listing agent. Carol helped try to find a buyer for Jennifer's property.

Answer 311

setback Ex. Cameron was happy that the setback requirement was 12 feet in his neighborhood, especially when he saw the horrible color his neighbor painted his house.

Answer 312

sales price Ex. While the market value of Sylvia’s property was $265,000, because of some structural issues discovered during the home inspection, the sales price ended up being a bit less.

Answer 313

lease Ex. Jefferson is leasing an apartment from Lila for one year. He signs a one year lease, which is a contract that allows him to possess the apartment for that time, but does not transfer ownership.

Answer 314

corporation Ex. IBM Corporation has more than 400,000 employees.

Answer 315

promissory note Ex. Unlike a mortgage or deed of trust, a promissory note is not recorded; the lender holds the note while the loan is being paid off. When it is fully paid off, the note is returned to the borrower, marked as paid in full.

Answer 316

heir Ex. Eldred died without leaving a will, and the search began for any heirs to inherit his estate.

Answer 317

quitclaim deed Ex. When Bill and Martha divorced, Martha signed over her interest in their property to Bill through a quitclaim deed.

Answer 318

straight-line depreciation Ex. Residential properties have a 26.5-year straight-line depreciation schedule; commercial properties are on a 39-year straight-line depreciation schedule.

Answer 319

involuntary lien Ex. Becky forgot to pay her taxes, and a lien was placed on her property. This was an involuntary lien.

Answer 320

defeasible fee estate Ex. Jackie was granted a deed to her grandmother's house, provided that she didn't marry. If Jackie got married, she'd have to forfeit ownership of the home.

Answer 321

reasonably foreseeable Ex. When Saffron broke her contract with Bob on the sale of her house, he'd already paid for reasonably foreseeable costs, such as the inspection, the appraisal, and the survey. So she had to reimburse him for these costs.

Answer 322

levy Ex. The municipality’s tax levy created a $2,000 lien on individual property owners.

Answer 323

wallboard (aka plasterboard) Ex. One of the messier jobs in construction is the installation of wallboard, especially when a lot of cutting is involved—the plaster dust goes everywhere.

Answer 324

situs Ex. Often the situs of a parcel will determine its value.

Answer 325

Rivers and Harbors Act Ex. The Rivers and Harbors Act is the oldest federal environmental law in the U.S.

Answer 326

acre Ex. The Jones farmhouse was on 10 acres. Their parcel had 435,600 square feet.

Answer 327

police power Ex. Exercise of police power must be in the public’s best interests, such as when a city imposes zoning restrictions, building codes, or a curfew.

Answer 328

conservation easement Ex. When owners create a conservation easement, they lose some rights to the property, because the easement constrains use of the land.

Answer 329

list back Ex. Marvin worked with developers to help them find properties. He took a reduced fee as a buyer agent in return for a list back agreement. When the properties were developed and put up for sale, Marvin was the listing agent.

Answer 330

doctrine of laches Ex. Although the covenants of the Happy Camper Mobile Home Park prohibited pets, this restriction was not enforced, and eventually disappeared through the doctrine of laches.

Answer 331

default Ex. In recent years, many buyers strategically defaulted on their home loans when it became clear that the home was a bad investment.

Answer 332

principle of anticipation Ex. The principle of anticipation says that the value of a property is determined in part by the current anticipation of future benefits.

Answer 333

homeowner's insurance Ex. When Jill's property was vandalized and several items stolen, her homeowner's insurance policy paid her claim promptly, and she was able to fix the damage and replace the stolen items.

Answer 334

jumbo loan Ex. Because her loan was considered a jumbo loan, Anita didn't qualify for the most favorable interest rates, and had to pay a 1/4% premium.

Answer 335

mortgage Ex. Scott’s mortgage enabled him to have a house, so he didn’t mind this voluntary lien on his property.

Answer 336

assignor/assignee Ex. Max acted as assignor when he assigned his lease to Heather, the assignee, so that Max could move out and pursue his dream of becoming a pilot.

Answer 337

volatile organic compounds Ex. Concerned for her family's health, Heather made sure to purchase low-VOC paints and solvents when she repainted the family home.

Answer 338

right of survivorship Ex. The three amigos owned a triplex in a joint ownership, each owning one-third of the property. Amigo #1 died, so Amigos 2 and 3 now each own half of the property because of their right of survivorship.

Answer 339

Fair Credit Reporting Act Ex. The Fair Credit Reporting Act passed in 1970 with the mission of ensuring fairness, accuracy and privacy of the personal information contained in the files of the credit reporting agencies.

Answer 340

originate, sell, and service release Ex. Big Time Bank routinely originated loans, then immediately dumped them into the secondary market, letting someone else worry about collecting payments every month.

Answer 341

dual-licensed dual agency Ex. Broker Pat called on Jake to act as designated agent for the seller, so when licensee Karen brought in a buyer, she could act as designated agent for the buyer.

Answer 342

Interstate Land Sales Full Disclosure Act Ex. The Interstate Land Sales Full Disclosure Act of passed in 1968 to help regulate interstate land sales and protect consumers from fraud and abuse in the sale or lease of land. Among other provisions, the Act requires land developers to register subdivisions of 100 or more non-exempt lots or condominium units.

Answer 343

net listing Ex. Jerome is listing Kim’s house. She tells him she needs to get “at least $225,000,” but that any amount above that amount he can keep. If Jerome and Kim sign a listing agreement under these terms, it is an illegal net listing.

Answer 344

mechanic’s lien Ex. Harry’s carpenter put a mechanic’s lien on his property for nonpayment of his work.

Answer 345

appraisal Ex. The appraisal on Myra’s property was for its use as a bed-and-breakfast today.

Answer 346

budget mortgage Ex. Gabrielle hated paying bills, so she was glad her lender had set her up with a budget mortgage where her PITI was handled in one payment each month.

Answer 347

balloon payment Ex. Trinity's loan had low monthly payments, but a large balloon payment at the end of the loan term.

Answer 348

sale-and-leaseback/sale-leaseback Ex. XYZ Corporation needed capital for research and development. It entered into a sale and lease back agreement with a private investor, giving XYZ the funds it needed without necessitating a move from its headquarters.

Answer 349

dower Ex. Millie’s husband died without a will, and penniless, but at least she had a dower’s interest in the property they owned.

Answer 350

Privity of Contract Ex. According to the privity of contract, if a lessee abandons a rental, the lessor cannot attempt to gather damages from the lessee's family.

Answer 351

kickback Ex. Fred gives Ginger a 20 percent referral fee from his commission. The trouble is, Ginger is his neighbor, and not a real estate licensee. This kickback is illegal.

Answer 352

customer Ex. Even though customers are not clients, agents owe to customers the duties of fair and honest dealing, and disclosure of who the agent represents, and disclosure of any material facts.

Answer 353

Truth in Lending Act (TILA) Ex. Due to the Truth in Lending Act, it's illegal for a lender to state ""0% financing!"" in a financing ad if the remaining terms aren't disclosed.

Answer 354

advance consent to dual agency Ex. Because some states allow advance consent to dual agency, agents don't have to scramble to obtain this form in the heat of the moment when faced with a potential dual agency situation.

Answer 355

limited partnership Ex. If John had been a limited partner rather than a general partner, he wouldn't have had to declare bankruptcy.

Answer 356

gross income Ex. When Cari computed her gross income it looked fantastic! But by the time she deducted her expenses and found her net income, she thought, “Now that’s gross!”

Answer 357

debt-to-income ratio Ex. Because Janice's debt-to-income ratio was too high, she didn't qualify for a mortgage.

Answer 358

tacking Ex. Although Andy had only been using Jacques' property for 5 years, when his daughter, Amy, inherited the property, she continued the adverse use and eventually met the statutory requirement by tacking her time on to her dad's.

Answer 359

remainder interests Ex. Chad left his family home to his second wife for her lifetime with the provision that it pass, at her death, to the son of his first marriage.

Answer 360

deed of trust Ex. Some states use deeds of trust; others use mortgages. Often ""mortgage"" is used even when a person means deed of trust.

Answer 361

sill plates Ex. Think of the sill as the base, or support for the vertical members that will be attached to it.

Answer 362

severalty Ex. When a single person purchases a home, it is common for the ownership to be in severalty—an exclusive interest in the property.

Answer 363

incentive zoning Ex. In exchange for being granted the right to construct a building with more stories than customarily allowed, the developer promised to build a community park next door.

Answer 364

lease fee Ex. Janice signed a lease with Carolyn, to rent her house. As Carolyn’s tenant, Janice now has a lease fee right on Carolyn’s house. She has the right to possess, but she does have ownership.

Answer 365

down payment assistance programs Ex. One of the most satisfying aspects of Bob's career was helping moderate-income families attain their goal of homeownership.

Answer 366

mold Ex. It is estimated that 70 percent of households have mold in their walls.

Answer 367

special assessment lien Ex. Owners can pay a special assessment in total, but paying in installments with interest is quite common. If an owner defaults on special assessment payments, the county treasurer has authority to sell the owner’s property to pay the assessment

Answer 368

legal capacity Ex. A person who is not mentally competent or who has not yet reached the age of majority is not of legal capacity.

Answer 369

appurtenances Ex. Jason loved being a property owner. He decided not to sell off any of his appurtenances to others. He kept all of his bundle of sticks together.

Answer 370

first mortgage Ex. Nan obtained a first mortgage when she purchased her house, and a second mortgage several years later. When she was foreclosed on, the first mortgage was paid off first from the proceeds of the foreclosure sale.

Answer 371

steering Ex. When Jillian told her Asian buyers that they wouldn’t be happy in the Irvington neighborhood because of its nearly all-white population, she was illegally steering them away from the neighborhood.

Answer 372

air rights Ex. In Burlesque, “Ali” saved the day when she told the club’s owner (played by Cher) that she could sell her air rights to the luxury condominium developer across the street.

Answer 373

operating budget Ex. Ross felt that an operating budget was in many ways a work of fiction, due to the amount of projections that had to be made—but it was necessary for planning purposes, and helped him stay on track for his clients.

Answer 374

obedience Ex. Because of his duty of obedience to his client, Sarah, Bill could not show her property on the weekend.

Answer 375

easement by necessity Ex. Burt’s property had no access to the main road. To get there, he had to cross his neighbor’s property. Luckily his property had an easement by necessity to do so.

Answer 376

tie-in arrangement Ex. Fred told his client: ""If you want me, you've got to use my mortgage broker, Barry. He's the best in the business and makes problems go away. I won't work with anyone who doesn't use him."" This is an illegal tie-in arrangement, and Fred is violating antitrust law.

Answer 377

protection clause Ex. If the term of the agreement ended on January 31, and the buyer contacted a seller whom their broker had previously identified and then signed a purchase contract on February 1, the broker would still be owed a commission under the protection clause.

Answer 378

lessor Ex. Lila, a landlord, is a lessor.

Answer 379

good funds Ex. The closing company required the buyer to pay with good funds to prevent delays due to funding. The buyer could use a cashier's check, certified check, or wire transfer.

Answer 380

familial status Ex. When the landlord posted a sign that read: “One heartbeat per bedroom” the result could be discrimination based on familial status as families with children who share bedrooms would be prohibited from tenancy.

Answer 381

radon Ex. Unhealthy levels of radon in a home may be lowered through the installation of a filtration system.

Answer 382

rate of return (ROR) Ex. The rate of return, when expressed as a gain of an investment sold, is defined as income received plus capital gains realized on the sale of the investment.

Answer 383

disabled licensee Ex. Although required to attend an in-person class, Mavis, a disabled licensee, was allowed to take her course online.

Answer 384

real estate appraiser Ex. In most real estate transactions, the buyer will hire an appraiser to provide a professional opinion of value. Often lenders will require an appraisal before lending money on a property, to protect the lender’s interests by making sure the value is there.

Answer 385

commission Ex. Janice’s commission was 5%. But she had to give 2.5% of that to the buyer’s agent, which left her with 2.5%. Then she had to give 50% of that to her broker, which left her with 1.25%.

Answer 386

alluvion Ex. When water flowing from a creek bordering Jillian's property created a sandbar, she was able to use the alluvion—the new land mass that formed—as her own property.

Answer 387

grantor/grantee Ex. When Carol bought Todd’s property, she was given a deed by Todd. Todd was the grantor, and Carol was the grantee.

Answer 388

parcel Ex. Shana pored over the developer’s blue print and pointed to a large lot near the lake. “I’d like to have my home on this parcel here,” she said.

Answer 389

escrow analysis Ex. After Julianne's lender performed an escrow analysis, it determined she was short $249, and invoiced her, giving her the option to pay it in one lump sum, or by increasing her monthly mortgage payment.

Answer 390

lien theory Ex. Because Engelbert lived in a lien theory state, he held title to his property even though he financed it. His mortgage created a lien on the property.

Answer 391

specifications Ex. Building specifications often include the materials used, design features, and an explanation of systems used.

Answer 392

wood-destroying insects Ex. Termites are often referred to as “silent destroyers” because they can munch their way through the cellulose found in anything made of wood—flooring, wallpaper, etc.—without the homeowner noticing.

Answer 393

homestead Ex. In some states, owners can protect a specific dollar value of their homes from creditor claims if the home is a family home. Categories of homestead properties include condominiums and vacant land not exceeding 10 acres zoned for one-, two- or three-family residential properties, and farm dwellings.

Answer 394

loyalty Ex. Because of his duty of loyalty to his client, Brent showed him a For Sale By Owner property that met his needs, even though the commission rate was very low.

Answer 395

quadrangle Ex. James pointed to the quadrangle on a survey map. ""This section of townships will most benefit the new railroad.""

Answer 396

township Ex. A complete legal description using the rectangular survey system consists of four segments: the tract description, the section number, the township number and direction, and a range number and direction.

Answer 397

due diligence Ex. Before his clients purchased a parcel of land that was formerly used for industrial purposes, Jerry recommended they perform a due diligence environmental assessment.

Answer 398

metes and bounds Ex. Darla laughed when she saw the metes and bound description. Although it was a legal description, it contained terms like “west of the widow Fiona Smith’s stone wall.”

Answer 399

intentional misrepresentation Essentially the same as fraud; misrepresentation that occurs when the person knows better and intentionally remains silent or misstates the facts Ex. Debra was convicted of intentional misrepresentation for failing to disclose the snake infestation she knew to exist at her listing.

Answer 400

originate, sell, and service Ex. Even though Joe's mortgage loan was sold to an investor on the secondary market, he still sent his payments to his original lender every month.

Answer 401

foundation walls Ex. Foundation walls also form the sides of the basement area, and inspectors will usually investigate for significant cracking here.

Answer 402

net lease Ex. The Peach Tree Office Park issued net leases to their tenants, so they would share in the cost of property taxes and utilities. The landlord didn't want to have to do all of that herself!

Answer 403

principal balance Ex. The remaining balance on her loan was $22,100, but Juanita also needed to factor in other charges for her total payoff, not simply her principal balance.

Answer 404

life cap Ex. Although the index to which her adjustable rate mortgage was tied rose 3%, which would have made her interest rate 8%, the life cap on her ARM was 7%, so that became her new interest rate.

Answer 405

equilibrium Ex. A neighborhood will likely stay in this stage for several years until time begins to take a toll on homes, and the inevitable deterioration becomes evident.

Answer 406

subject to clause Ex. Tammy bought Sam's house subject to his loan. If Tammy stops making payments, though, Sam will still be ultimately responsible for them.

Answer 407

down payment Ex. The Kimballs’ loan requires them to put at least 20% down. This down payment will go toward the purchase price, and they will obtain financing for the other 80 percent. When they make their offer, the Kimballs include earnest money--a down payment of 10% to the seller’s attorney. At closing, this amount will be deducted from the cash they need to bring to fund the purchase.

Answer 408

sole proprietorship Ex. Pat liked to work alone, so he could be sure to control all the decisions and interests of his business, so he created a sole proprietorship.

Answer 409

mortgage broker Ex. Mike Jiminez is a mortgage broker working for Lendwell Brokerage. Mike matches borrower needs with lender products for a fee.

Answer 410

Truth in Lending Act Ex. Due to the Truth in Lending Act, it's illegal for a lender to state ""0% financing!"" in a financing ad if the remaining terms aren't disclosed.

Answer 411

lead Ex. Lead was banned in paint in the 1970s due to its harmful effects on household inhabitants, particularly children.

Answer 412

bill of sale Ex. When Ginger sold her golf cart to Mary Anne, they used a bill of sale to complete the transaction.

Answer 413

Federal Trade Commission (FTC) Ex. The FTC has the authority to enforce compliance with the Sherman Act and sections of the Clayton Act, which supplements the Sherman Act.

Answer 414

erosion Ex. Kalmut decided to landscaping to help prevent erosion of the soil on the sloped property.

Answer 415

secured loan Ex. he opposite of a secured debt is an unsecured loan, one not connected to a piece of property. Instead of foreclosing and claiming the collateral, the lender may only pursue a judgment against the borrower.

Answer 416

servient tenement Ex. Because Daniel had the right to cross his property, Ben’s property had the servient tenement.

Answer 417

escrow account Ex. One of Barb's duties was to manage the escrow account for her firm's transactions.

Answer 418

maturity Ex. Alvin purchased a five-year certificate of deposit. Five years later, upon the CD's maturity, Alvin could either reinvest in a new certificate of deposit, or obtain his money and interest earned.

Answer 419

home inspector Ex. Ralph, a home inspector, charges $500 to inspect a single-family home. It takes in three to four hours, plus the time to write up a report, and travel time.

Answer 420

unimproved land Ex. The vacant property had no structures, no water, and no utilities. It was unimproved.

Answer 421

purchase agreement Ex. Herb, a buyer, and Manny, a seller, entered into a purchase agreement for Manny to sell his townhome to Herb. The purchase agreement specified the price and terms, including contingencies that must be met.

Answer 422

Housing and Community Development Act of 1974 Ex. Thanks to the Housing and Community Development Act of 1974, gender is now a protected class.

Answer 423

timeshare Ex. Helen bought a time share on the Oregon coast that allowed her to have her own place when she visited her daughters for two weeks a year.

Answer 424

planning board/commission Ex. An early step for Mary was gaining initial planning board buy off for a zoning variance or special use permit for the farmhouse.

Answer 425

timeshare estate Ex. Max planned on using his timeshare estate in Hawaii for a number of years, then selling it once the property appreciated enough for him to make a decent profit.

Answer 426

delivery and acceptance Ex. After the buyer and seller closed on the transaction, the deed was delivered to the title company, who provided an acknowledged copy to the buyer. The recording of the deed presumed buyer’s acceptance.

Answer 427

acceleration clause Ex. When Wendy stopped making home loan payments, her lender told her she must pay off her entire balance or risk foreclosure.

Answer 428

full covenant and warranty deed Ex. Nellie was nervous about accepting a deed that was not a full covenant and warranty deed. She was worried that her title might be impacted by another’s claim or an unknown encumbrance.

Answer 429

originate, hold, and service Ex. Margaret appreciate that the lender she initially borrowed with was the same lender that she sent her payments to every month and eventually released the title to her once the loan was paid off.

Answer 430

seller agency Ex. Keira made sure to have Ben sign a seller agency agreement when he hired her to list his home.

Answer 431

nonhomogeneity Ex. Even if two houses were identical, because no two parcels of land are interchangeable, real estate is said to have the characteristic of nonhomogeneity.

Answer 432

valuable consideration Ex. When Biff promised to give Calli his jet ski in return for her horse trailer, the trailer and jet ski were valuable considerations in their agreement.

Answer 433

latent defect Ex. Barbara was able to get out of her contract to buy a rancher when the home was discovered to have a latent defect - the foundation was unsafely graded.

Answer 434

Uniform Residential Landlord Tenant Act of 1972 (URLTA) Ex. Even though few states have adopted this act exactly as it's written, most states have adopted some version of it.

Answer 435

Community Reinvestment Act (CRA) Ex. CRA has been revised multiple times since its initial passage.

Answer 436

slab-on-grade construction Ex. With a slab-on-grade-construction, the concrete is poured directly onto the ground, eliminating either a crawl space or basement.

Answer 437

urea-formaldehyde foam insulation (UFFI) Ex. While contractors have stopped using UFFI, the material is still in use in many homes. However, most of its toxins are released in the first two to three years making older insulation relatively benign.

Answer 438

take-out loan Ex. Once the Millers received their certificate of occupancy on their new vacation (and one day retirement) home, they converted their construction loan to a take-out loan, a more traditional 30-year mortgage.

Answer 439

legal purpose Ex. Because Mario was intending to buy Marisa's home in order to serve as a meth lab, the contract was unenforceable.

Answer 440

fixture Ex. The bookshelves in the dining room were built-in; they were a fixture and could not be removed by the seller.

Answer 441

listing agreement Ex. Gina is a real estate salesperson who contracts with her aunt, Ruby, to sell her property. Gina and Ruby sign a listing agreement that includes the terms of their arrangement and contractually obligates both parties to those terms.

Answer 442

quiet enjoyment Ex. Leigh discovered that her landlord had been entering her apartment while she was at work. This is a violation of her right to quiet enjoyment.

Answer 443

inspection contingency Ex. If a repair issue arises that’s more than the buyer is willing to take on, the inspection contingency will allow the buyer to negotiate repairs, a sales price reduction, or terminate, receiving a refund of the earnest money. This must be accomplished during the inspection period.

Answer 444

credit report Ex. Ann's credit report showed that she had a history of missing her payments. Because of the report, her lender denied her loan.

Answer 445

Environmental Protection Agency (EPA) Ex. The EPA aims to, among other things, Ensure that all Americans are protected from significant health risks and environmental issues at their homes, schools, and workplaces; and decrease national environmental risks based on the best scientific information available.

Answer 446

informed consent Ex. Until a consumer understands the particulars of each agency agreement available, it is impossible to provide informed consent.

Answer 447

flashing Ex. Improper installation of flashing can allow water to seep into a house or under roof tiles, damaging the roof.

Answer 448

underground storage tanks Ex. Because the underground storage tank holding the heating oil for his home was more than 20 years old, Chuck worried about it possibly leaking and contaminating the soil.

Answer 449

market allocation Ex. When the two competing real estate firms agreed to divvy up the market into east and west regions, and stay out of one another's area, this was an antitrust violation called market allocation.

Answer 450

taking Ex. The state government planned to take several properties in order to build the new state highway, but the Takings Clause in the Fifth Amendment required it to give compensation to the owners in exchange for the title.

Answer 451

assignment (rentals) Ex. Daniel is moving out of state, and assigns his lease to Benjamin. Benjamin becomes responsible for the lease.

Answer 452

homeowners association (HOA) fee Ex. Brenda pays $1,200 on her mortgage, and another $235 each month in homeowners association fees. When she applied for her loan, her total household debt used to calculate her household debt ratio was the combination of her mortgage payment and her HOA dues.

Answer 453

special assessment Ex. Due to the new city park, all property owners were subject to a special assessment.

Answer 454

triggering term Ex. When creating the advertising pieces for the new subdivision, Astrid intentionally omitted triggering terms such as "only 3% down."

Answer 455

real estate Ex. When you are a practicing licensee, we hope you sell a lot of real estate!

Answer 456

Home Mortgage Disclosure Act Ex. Congress believed that blighted areas were caused in part because financial institutions failed to provide adequate home financing to qualified applicants at reasonable terms and conditions. HMDA requires financial institutions to provide the public with information that demonstrates its actions in serving the housing credit needs of their communities.

Answer 457

appraisal contingency Ex. If the appraised value is close to the sales price, often the parties can reach agreement. If not, and an appraisal contingency is in place, the buyer can use the fact that the property didn’t appraise to terminate and receive a refund of earnest money deposited.

Answer 458

equitable redemption period Ex. The length of this period is at the lender’s discretion, but must be at least 60 days to allow for proper notice/ advertisement.

Answer 459

Internet Data Exchange (IDX) Ex. Patel used an IDX plug-in on his website to import listings in from the state's MLS.

Answer 460

annexation Ex. When Mrs. Goldman planted the rosebushes in her yard, the resultant annexation meant that the rosebushes were now made part of the property.

Answer 461

proration Ex. Karen had prepaid some expenses and had not yet paid her property tax. These items were prorated between the parties in the closing statement so both paid their fair share.

Answer 462

lally columns Ex. Lally columns are often used in basements or crawl spaces to support sagging floor joists. In some applications they are tantamount to a temporary “jack” but are often used for permanent support.

Answer 463

non-conforming loan Ex. Harry's loan was a non-conforming loan; therefore he paid a higher rate as the lender assumed a higher risk.

Answer 464

CAN-SPAM Act Ex. Thanks to the CAN-SPAM Act, Cecily's email inbox was fairly uncluttered (except from all those jokes her brother-in-law sent her).

Answer 465

ratification Ex. Even though the seller was supposed to leave behind the washer and dryer, they took them when they moved out. The buyer ratified their decision by moving in and getting a set of their own without making a fuss about it.

Answer 466

DUST Ex. Vladimir the appraiser explained how the demand, utility, scarcity and transferability of the property each determined value.

Answer 467

single-family home Ex. Julia loved living in a condo. She missed her single-family home because of its yard, and privacy, but she didn't miss the upkeep at all!

Answer 468

cooperative Ex. Jackson found himself drawn to the idea of residing in a cooperative that focused on sustainable living.

Answer 469

revocation Ex. Ernie violated license law, and his license was revoked. He may not apply for a new license for at least one year.

Answer 470

intestate Ex. When a person dies intestate, the laws of inheritance apply.

Answer 471

installment sale Ex. When Ben bought Rachel's property, she used an installment sales contract to lend him some of the money for it, which Ben paid directly back to Rachel.

Answer 472

procuring cause Ex. Because Liza originally showed Dewey the property, she was owed a commission through the concept of procuring cause, even though it was Billy who wrote the offer.

Answer 473

pre-approval Ex. Although the Millers received a prequalification letter from the buyer for their home, they were relieved a few days later when they received a preapproval letter. They knew that the preapproval carried more weight, although it was still not a guarantee.

Answer 474

reversionary interest Ex. Carmen may give her investment home to her great aunt with the provision that at her great aunt’s death the ownership returns to Carmen. During her great aunt’s life, Carmen has a reversionary interest.

Answer 475

lis pendens Ex. Deena was glad she saw the lis pendens notice on the property she was considering making an offer on. She didn’t need to get halfway through a transaction and find out there was a judgment against the property!

Answer 476

acknowledgment Ex. Gary purchased a duplex. The grantor signed the deed; a notary public acknowledged his signature.

Answer 477

amperage Ex. The pulses were of high voltage but low amperage, which makes them, like static electricity, safe but an unpleasant experience.

Answer 478

fiduciary duties Ex. Fiduciary duties can best remembered by the acronym, OLD CAR.

Answer 479

tax lien Ex. Tax liens include estate and inheritance tax liens, income tax liens, property tax liens, corporation franchise tax liens. Only the real property tax lien is specific; the others are general and may cause a lien against all property of the individual.

Answer 480

TRID/TILA-RESPA Integrated Disclosures Ex. Lenders and brokers alike need to play by the rules of TRID, especially concerning the three day window for consumer review of the documents; any changes means that three day timeframe starts over again.

Answer 481

revolving debt Ex. Marcus had a home equity line of credit for $20,000. However, he only borrowed $3,000, so he only had to pay interest on the $3,000 borrowed.

Answer 482

corporate bonds Ex. Similar to municipal bonds, the bonds are issued at face value and earn interest over the holding period, after which the investor receives the face value of the bond.

Answer 483

credit history Ex. Due to his abysmal credit history (Derek never met a bill he couldn't avoid), he didn't qualify for a home loan.

Answer 484

Homebuyers Armed With Knowledge (HAWK) Ex. After completing the HAWK program, Sinead's upfront MIP was reduced by 0.5%, and her annual MIP decreased 0.1%.

Answer 485

escrow Ex. Jillian, a sponsoring broker, deposits all client earnest money funds into a neutral escrow account until the transaction is completed or terminated, at which time she instructs the funds be disbursed according to the contracted terms.

Answer 486

homeowners association Ex. The Brighton Wood homeowners association (HOA) scheduled maintenance of the pool and gardens for the enjoyment of the homeowners, who paid quarterly dues for that privilege.

Answer 487

lot lease provision Ex. Mike Grant sold three lots in Grant Meadows. This triggered a lot lease provision, which required him to pay back a portion of his loan.

Answer 488

blockbusting Ex. Sharon lost her license when it was discovered that she had told homeowners in the Birdseye neighborhood that they should sell because the neighborhood was “turning Asian.” This is blockbusting and it is illegal.

Answer 489

lock in Ex. Jerome was concerned when closing was delayed. His rate lock in was only good for another two weeks. What if rates rose? He might not be able to qualify for the loan!

Answer 490

industrial property Ex. Examples are warehouses and factories.

Answer 491

lifting clause Ex. Without this clause, a borrower with a second mortgage could never get a lender to agree to a refinance of the first mortgage because the second lienholder would immediately advance to first position as soon as the first mortgage was paid off as part of the refinance.

Answer 492

unilateral rescission Ex. When Dave breached his contract with Joe, Joe had the power to unilaterally rescind their agreement.

Answer 493

notice of default Ex. When Don forgot to pay his mortgage for two months, he received a notice of default. If he doesn't bring his past-due amount due (plus interest and late charges), he could face foreclosure..

Answer 494

option clause Ex. Bartholomew's lease included an option clause, so he extended the term of his lease so he didn't have to move. He loved this place!

Answer 495

delinquency Ex. Due to frequent delinquencies on her automobile loan, Ruby's credit score declined, and she was unable to qualify for a home loan.

Answer 496

full seller disclosure state Ex. Since they were in a full seller disclosure state, Sharon made sure to have her seller client fill out the property disclosure form and list any additional matieral defects he knew about.

Answer 497

title examination Ex. ABC Title performed a title examination on Karen’s property and it turned up no known defects.

Answer 498

FICO score Ex. FICO scores range from 300850. The higher the score, the lower the credit risk.

Answer 499

staging Ex. Monica always recommended that her clients hire a professional stager. She had seen what staging a property could do for quick sales, not to mention sales price, and recommended the service highly.

Answer 500

general partnership Ex. Because John was a general partner, when the investment lost money, he went bankrupt.

Answer 501

contractual ability Ex. Because Chip was only three years old, he had no contractual ability.

Answer 502

negative amortization Ex. Shelby’s negative amortization loan allowed him to make smaller payments, but in three years, he actually owed more than when he started.

Answer 503

prequalification Ex. Most sellers will not accept an offer that requires financing if the prospective buyer has not at least included a letter of prequalification from their lender.

Answer 504

land contract Ex. When Ben bought Rachel's property, she used a land contract to lend him some of the money for it, which Ben paid directly back to Rachel.

Answer 505

agency Ex. Due to their agency relationship, Kim was put in a position of trust for David.

Answer 506

convertible ARM Ex. Calli wasn't sure what her finance situation would be. She preferred a fixed-rate mortgage, but liked the lower interest rate of an adjustable rate mortgage. She opted for a convertible ARM to give her the flexibility to convert to a fixed rate mortgage at a later date.

Answer 507

prohibition of waste Ex. Max, the life tenant in his son's property, made sure to keep the home in good repair and pay the property taxes on time during his possession, so as to prevent waste of the property.

Answer 508

trust Ex. Lyle put all of his property into trust so that in the event of his demise, his assets could pass to his heirs outside of probate.

Answer 509

interest (property) Ex. As a beneficiary to her grandmother's will, Susie has an interest in both the farm house and and the mountain chalet.

Answer 510

asset Ex. Liquid assets include checking and savings accounts. Other assets include real property, automobiles, and accounts receivable.

Answer 511

Administrative Procedure Act Ex. The Administrative Procedure Act was partially enacted in response to FDR's New Deal, in an effort to prevent the federal government from having too much power.

Answer 512

conventional life estate Ex. Emma wrote her will out to include possession of her home to her nephew for the term of his life, after which it would pass to her favorite charity, Cats and Canaries.

Answer 513

trustee Ex. Lisa was the trustee for her parents’ estate, and acted on behalf of herself and her siblings, as beneficiaries.

Answer 514

index lease Ex. When Samantha saw the rising gas prices, she knew her rent would go up, too. Inflation meant an inflated rent payment!

Answer 515

natural person Ex. The deed stipulated that further conveyances of the property may only be between natural persons.

Answer 516

spot zoning Ex. Arty had friends on the zoning board of appeals and was able to muscle in a spot zoning change to commercial for his property so he could run a restaurant in his neighborhood.

Answer 517

servient estate Ex. Because Daniel had the right to cross his property, Ben’s property had the servient estate.

Answer 518

basement Ex. Basements are an area that home inspectors tend to spend a lot of time in due to the mechanical and electrical and drainage issues often found there.

Answer 519

plaintiff Ex. Connie sued Darius for divorce. Connie is the plaintiff and Darius is the defendent.

Answer 520

security Ex. Real estate investments are securities if they require an investment of money, are a group enterprise, and are intended to make a profit, if that profit is solely derived from the management effort of others.

Answer 521

encryption Ex. Security measures that Elite Realty uses includes encryption of all of its sensitive online data.

Answer 522

group boycotting Ex. The group boycott of the limited services firm was an antitrust violation.

Answer 523

misrepresentation Ex. When Jerome told Kirby that the roof repairs wouldn't cost more than a few hundred dollars, and Kirby purchased the property and then learned it would need a complete tear-off, this was misrepresentation.

Answer 524

Uniform Electronic Transaction Act (UETA) Ex. As Flavia securely emailed her clients several documents needing their signatures and then received them back all signed within one hour, she thanked her lucky stars and UETA for making her job so much easier.

Answer 525

buyer presentation Ex. Chet always prepared for buyer presentations as carefully as he would have prepared for a job interview--because that's exactly what the buyer presentation is.

Answer 526

passive income Ex. When Bill’s book “How to Make a Boatload of Bucks in Real Estate” started paying royalties, he enjoyed the passive income he received.

Answer 527

agency disclosure form Ex. When conducting real estate activities, licensees should present the agency disclosure form at the first substantive contact with a consumer.

Answer 528

directional growth Ex. Directional growth is considered by appraisers because it plays a part in determining various principles of value, such as supply and demand and highest and best use. So a property located within an “up and coming” neighborhood might be valued higher than a similar home in a neighborhood that seems to be in decline.

Answer 529

full-service lease Ex. Don’t confuse this with a NNN lease, where the tenant pays these charges separately. By including charges for these in the base rent, the base rent remains stable over time.

Answer 530

Federal Housing Administration (FHA) Ex. Rita obtained an FHA loan, allowing her to put just 3.5% down, and she also appreciated that her loan's credit score requirements weren't as strict as for conventional loans.

Answer 531

tax assessor Ex. Once Mary’s property is sold, the sales price and permit status will be reviewed by the tax assessor, who will likely update the tax value at the next assessment period.

Answer 532

actual notice Ex. Karen told her neighbors she would be moving; this was actual notice.

Answer 533

bridge loan Ex. The Clausens’ sale of their current home would not go through until after the closing date on their dream home. They used a bridge loan to close the gap in financing.

Answer 534

margin Ex. The lender’s margin is constant; the interest rate changes when the index to which the margin is added varies.

Answer 535

topography Ex. Mike Grant included topography in the site plan he submitted to the planning board for approval. It showed trees, boulders, and the location of wetlands and streams.

Answer 536

Equal Credit Opportunity Act (ECOA) Ex. Due to ECOA, minorities of all types now equal access to credit at fair terms.

Answer 537

title search Ex. ABC Title performed a title search on Karen’s property and it turned up no known defects.

Answer 538

Safe Drinking Water Act Ex. The state department of health makes sure that the commonwealth is in compliance with the regulations set forth in the Safe Drinking Water Act.

Answer 539

habendum clause Ex. The habendum clause provisions must agree with the provisions stated in the granting clause.

Answer 540

severance Ex. When Mrs. Goldman dug up her rose bushes, this was an act of severance. They were no longer part of the land, and were now personal property.

Answer 541

income approach Ex. Appraisers will use the income approach to value for commercial buildings and multifamily residential. It is seldom used for owner-occupied, single-family residential.

Answer 542

lease with option to buy Ex. Sam's happy he has a lease with option to buy on his house because he definitely plans to buy it when his lease is up.

Answer 543

auction Ex. After the Millers' house was foreclosed on, the lender auctioned it off.

Answer 544

development cost Ex. Jerry's dad always considered development costs (acquiring the land and constructing the buildings) as part of his due diligence.

Answer 545

profit (land) Ex. Profit in land can actually be more valuable than owning the land itself. The right to drill for oil, for instance, could easily outvalue the land.

Answer 546

Superfund Amendments and Reauthorization Act (SARA) ed in 1986, this expanded the definition of individuals liable for environmental cleanup costs. However an amendment was made to CERCLA at the same time for an “innocent landowner” defense.

Answer 547

front foot Ex. Seamus’s property had 200 feet of river frontage, which made it more valuable than his neighbor’s property, which only had 40 feet of river frontage.

Answer 548

wetlands Ex. Many states have laws and policies in place to protect ecosystems such as wetlands.

Answer 549

scope of work Ex. Jamie included high-end kitchen appliance in his new build's scope of work.

Answer 550

seller net sheet Ex. Mike's clients were considering accepting an offer on their home, but wanted to know how much money they'd be taking away, once their mortgage was paid off, the title company fees were paid, etc - so he prepared a seller net sheet for them.

Answer 551

lease agreement Ex. Charlie entered into a lease agreement with his new landlord. He'd pay $1,500 a month for the two-bedroom villa by the seaside.

Answer 552

variable expenses Ex. Water usage was a variable expense in the Pythian Apartments. The more tenants, the higher the bill.

Answer 553

prime rate Ex. Renaldo had worked on his credit for years and when he applied for a home loan, he qualified for his lender's prime rate. His friend, Susan, who had a less stellar credit, also applied with his lender, and was offered the prime rate plus another .75%.

Answer 554

Uniform Standards of Professional Appraisal Practice (USPAP) Ex. Because Momo was appraising a property for which a federal loan was involved she had to follow USPAP standards.

Answer 555

home warranty Ex. Barb asked her sellers to consider including a home warranty for the buyers.

Answer 556

curtesy Ex. When his wife died, Abe gained a curtesy estate in their home.

Answer 557

mortgage banker Ex. Wells Fargo Mortgage is among the several large lenders who are mortgage bankers.

Answer 558

growth Ex. This stage is usually evident until most of the building sites in the area are developed, at which point it will enter the equilibrium stage.

Answer 559

home equity line of credit (HELOC) Ex. Dusty and Susan used funds from their HELOC in order to install a gourmet kitchen, complete with granite counters and two wall ovens.

Answer 560

formaldehyde Ex. Because the formaldehyde-containing insulation in his home had been installed nearly 20 years ago, Jason was not overly concerned about any off-gassing effects.

Answer 561

leasehold estate Ex. Janice signed a lease with Carolyn, to rent her house. As Carolyn’s tenant, Janice now has a leasehold estate on Carolyn’s house. She has the right to possess, but she does have ownership.

Answer 562

groundwater Ex. When oil tanks leak, their chemicals can contaminate groundwater.

Answer 563

market value Ex. When real estate professionals prepare a CMA, they are most interested in determining an appropriate market value.

Answer 564

water rights Ex. Water rights are an important consideration if the landowner intends to farm.

Answer 565

outlot Ex. The outlots in the new subdivision were used for a convenience store and lending library

Answer 566

torts Ex. A tort is a wrongful act, and may be intentional or unintentional.

Answer 567

executor's deed Ex. An executor can only convey an executor's deed if the will or court of law grants the executor the authority to do so.

Answer 568

vacancy rate Ex. Vacancy rate = number of vacant units ÷ total units

Answer 569

secondary mortgage market Ex. MegaBillions Bank was a member of the primary mortgage market. It packaged its loans and sold them to the secondary mortgage market. ABC Bank is part of the secondary mortgage market. It buys loans from MegaBillions and services them for the consumer.

Answer 570

right of inheritance Ex. If there’s a right of survivorship, the co-owner doesn’t have the right to will interest in the property to an heir.

Answer 571

rafter Ex. The roof rafters constitute the framework for the roof.

Answer 572

security deposit Ex. Chip’s landlord charged him a full month’s rent as a security deposit. When Chip leaves, provided his rent is paid up and he leaves the apartment in reasonable condition, his landlord will refund this money to him.

Answer 573

variance Ex. Brandy had to obtain a variance for her property as she had to build three feet closer to the road than was permitted in the zoning ordinance.

Answer 574

platform construction Ex. Also called a western frame, platform framing is a building frame having studs only one story high, regardless of the number of stories built. Each story has a box sill, or platform.

Answer 575

qualified mortgage Ex. Qualified mortgages can’t have risky, often confusing features or any surprises for consumers.

Answer 576

reconciliation (appraisals) Ex. Because the fourplex was a rental property, Vladimir weighed the number derived from the income approach to value heaviest when he completed the reconciliation for the appraisal.

Answer 577

Fannie Mae Ex. FNMA creates the secondary mortgage market by purchasing and guaranteeing mortgages that meet its funding criteria.

Answer 578

easement by condemnation Ex. The road Karen lived on was being widened; she and all of her neighbors were subject to an easement by condemnation of the front four feet of their property. They were compensated, however, and Karen went to Maui.

Answer 579

completion bond Ex. When Mike Grant developed Grant Meadows, he provided the city with a completion bond, naming the City as beneficiary. The bond guaranteed that he would install parking medians on the adjacent street.

Answer 580

Taxpayer Relief Act of 1997 Ex. Joanne didn't have to worry about paying an early withdrawal penalty when she took out $10,000 from her IRA as a down payment on her new home, since that use is exempt from the penalty.

Answer 581

umbrella policy Ex. Abe’s standard policy only covered $50,000 for medical expenses. When he was sued for $125,000 and lost in court, the additional $75,000 was picked up by his umbrella policy.

Answer 582

timeshare use Ex. Since Monica's timeshare interest was taken as ""timeshare use,"" she could enjoy the property as much as her contract allowed, but wouldn't be able to sell it herself eventually.

Answer 583

self-dealing Ex. Self-dealing is illegal; therefore, when Martin did not tell his seller that the buyer was his cousin, with whom he had an agreement to split all profits from a rehab, he was committing a crime.

Answer 584

principal meridian Ex. A Principal Meridian is one of the prime meridians used in the government rectangular survey method of land description to locate range lines. It serves as the reference meridian in a land survey.

Answer 585

plat map Ex. Subdivision developers often offer prospective buyers plat maps that show the location of a given lot within the subdivision, as well as surrounding properties.

Answer 586

single-licensed dual agency Ex. Since Jake represented both the buyer and seller in a transaction, he had to be especially careful not to disclose confidential informaiton that would benefit one party over another.

Answer 587

constructive notice Ex. Karen’s conveyance of her deed was publicly recorded; this was constructive notice to the world that she had sold her property and that Vince was the new owner.

Answer 588

timeshare interest Ex. Sam bought timeshare interest at a resort in Cancun so he could soak up some sun and avoid the cold for a couple of weeks every January.

Answer 589

mortgage commitment Ex. Tim and Tom breathed a sigh of relief when they received a mortgage commitment from their lender. Now, if the property would only appraise!

Answer 590

land Ex. Land may be improved (with buildings or other permanent structures) or unimproved (vacant).

Answer 591

settlement service provider Ex. Settlement service providers may not pay one another kickbacks. This would be a violation of RESPA.

Answer 592

Tax Relief Act of 1997 Ex. Buyers still have to pay taxes on the distribution, and the distribution must be used within 120 days or else the penalty will be charged.

Answer 593

employee Ex. An employer will withhold taxes on behalf of an employee from the employee’s paycheck.

Answer 594

mapping requirements Ex. Sunny Side Development made sure to meet the mapping requirements of the area they were planning on developing before submitting their development plan to the city.

Answer 595

reverse annuity mortgage Ex. Thelma wanted to remain in her home, but she was on a fixed income and needed more funds. She agreed to a reverse mortgage in which a bank made monthly payments to her in return for ownership of her home.

Answer 596

percolation rate Ex. Septic system designers use the results of a percolation test to properly construct septic systems. The uniform slowest rate of drop of the water level over a measured time interval is converted to minutes per inch ad used as a basis of design in determining the size of the septic system.

Answer 597

girder Ex. Although girder and beam are often used interchangeably, girder often means that it is made of steel; beam is used more often with wood.

Answer 598

hazard insurance Ex. When a tornado blew off the roof of her home, Ramona was able to replace it by filing a claim against her hazard insurance.

Answer 599

title theory Ex. Whether a state is a title theory state or a lien theory state (in which the lender is considered to have a lien but not ownership of the property while the loan is unpaid) impacts the foreclosure process.

Answer 600

option to renew Ex. Brenda owns a boutique and is signing a lease in a building for her shop. Because she knows it can take several years to create loyal followers in a given market, she asks for an option to renew in her lease so she is not forced to find a new location just when her business is taking off.

Answer 601

reversion Ex. Ahmed claimed the right of reversion when the lease was up on his rental house.

Answer 602

restrictive covenant Ex. The restrictive covenant placed on all lots in David’s subdivision made him happy: no vinyl or chain link fences.

Answer 603

real property Ex. Real property can be segmented into a bundle of rights, with each right sold separately, to different owners.

Answer 604

tenancy at sufferance Ex. When Ben's lease expired, he didn't feel like going to the trouble of finding a new place to live, and he knew his elderly landlord didn't check the paperwork very often, so he kept living there as a holdover tenant.

Answer 605

accretion Ex. Jillian’s property grew through accretion when the creek flow created a long sandbar.

Answer 606

independent contractor Ex. Most licensees work as independent contractors; although brokers are responsible for their supervision, they do not control the details of licensee’s work, hours, location or performance.

Answer 607

manufactured housing Ex. One hurdle that keeps many buyers from seeking manufactured housing is its classification as personal property, absent an affirmative action by the homeowner to change its designation.

Answer 608

mortgage credit certificates Ex. Amanda made certain her buyer clients took advantage of all the resources available to them to help them buy their home, like mortgage credit certificates.

Answer 609

capital improvements Ex. Capital improvements can be deducted from capital gains when a property is sold.

Answer 610

seller carryback Ex. Ann got an 80/10/10 loan, with her lender giving her an 80% loan, the seller carrying 10% of the purchase price, and Ann putting 10% down.

Answer 611

bracketing Ex. The appraiser attempts to include both superior and inferior units of comparison such as age and transaction price.

Answer 612

loan-to-value ratio (LTVR) Ex. If a loan to value ratio exceeds 80%, the borrower will likely have to purchase private mortgage insurance for the lender.

Answer 613

sweat equity Ex. Jeff and Eleanor are partners in investment properties. Eleanor puts up the funds and Jeff's contribution is in sweat equity. He rehabilitates the property and when it sells, they split the profits accordingly.

Answer 614

price Ex. If the list price for a property is set beyond what the market will bear, buyers will not buy.

Answer 615

common law Ex. Another name for common law is case law.

Answer 616

correlation process Ex. Through a correlation process, the most weight may be given to one or two of the sales that are presented, or equal weight may be given to all.

Answer 617

decline Ex. Homes in a declining neighborhood are more likely to be rented rather than owner-occupied, and the overall level of maintenance is lower.

Answer 618

index Ex. When the Consumer Price Index rose, all interest rates based on the CPI rose as well.

Answer 619

executor Ex. Don was named executor in his aunt’s will. Don is charged with the responsibility to ensure that her last wishes are carried out.

Answer 620

Ginnie Mae Ex. Ginnie Mae issues guarantee certificates, similar to a U.S. government bond and pays the certificate holder interest rates 1% to 1.5% higher than government bonds.

Answer 621

refinancing, refinance Ex. When Avery refinanced his home, he paid off a higher interest rate loan with a lower interest rate loan, saving him several hundred dollars a month. However, the refinance also reset his loan term to 30 years.

Answer 622

brownfield Ex. The former site of a petroleum company became a brownfield eyesore until it was rehabilitated and turned into a community garden.

Answer 623

non-agent Ex. May helped her neighbors swap houses by filling out the paperwork for them. Because she represented neither of them, she was a non-agent.

Answer 624

survey Ex. EZ Mortgage asked Vince to pay for a survey of Karen’s property to verify boundary lines and ensure there were no encroachments.

Answer 625

loan modification Ex. The lender will verify borrower's ability to meet any changes to the terms of the loan.

Answer 626

buydown Ex. Alec decided to buy down the interest rate on his loan to make his payments more affordable.

Answer 627

examination of title Ex. A preliminary examination of title turned up another owner with a claim to the property.

Answer 628

certificate of eligibility (COE) Ex. Renita had served in the Air Force and decided to apply for a VA loan to purchase a home once she got out. She applied for and received a certificate of eligibility for the loan.

Answer 629

bundle of rights Ex. A property may have many owners; the sticks in its bundle of rights may be sold individually. One may own air rights, another mineral, another water, etc.

Answer 630

beneficiary Ex. Mr. and Mrs. Thomas created a shared living trust. Each put co-owned and separately owned property into the trust. When Mr. Thomas dies, Mrs. Thomas takes over as trustee and distributes her husband’s trust property to the beneficiaries he named in the trust document. Her property stays in the living trust.

Answer 631

avulsion Ex. Brady was aghast when part of his property washed away in a tidal wave. This avulsion caused him to lose 15% of his property.

Answer 632

annual percentage rate (APR) Ex. An interest rate of 6% may sound better than one of 6.25%, but it's important to also compare annual percentage rate (APR) figures to see the true cost of financing.

Answer 633

will Ex. The last will and testament of Barnaby Collins stipulated the placement of his above-ground coffin away from sunlight.

Answer 634

appreciation Ex. Due to appreciation, Kerry’s investment property had doubled in value over the eight years she had held it.

Answer 635

National Flood Insurance Program (NFIP) Ex. Since the town of Misty Glen was located in a floodplain, the town council decided to participate in the NFIP to help ensure that the community would be able to minimize future flood risks

Answer 636

amortization schedule/chart Ex. If borrowers want to see how much of their payment is going toward principal, they can check their mortgage statement, or an amortization schedule.

Answer 637

violation Ex. A violation of real estate law may result in reprimand, fines, and license revocation or suspension.

Answer 638

property insurance Ex. Lenders require homeowners to obtain property insurance to obtain a mortgage. The insurance protects the lender’s collateral (the property) in the event of a loss.

Answer 639

exclusive agency Ex. Because James had signed an exclusive agency agreement with his broker, Jackie, James had the option of selling his house himself and not paying a commission.

Answer 640

assignment (contracts) Ex. Ty decided to take an African Safari in the middle of his transaction. His brother agreed to have the contract assigned to him. However, Ty remains responsible unless a new contract is drawn up, naming his brother as the contracted party.

Answer 641

certified general real estate appraiser Ex. Because the property was valued at over $1 million and was part of a federally related transaction, only a certified general real estate appraiser could be used to perform the appraisal.

Answer 642

rent roll Ex. Keira examined the rent roll for the properties she managed, so she could see where the rent was coming in from. The lease end dates helped her determine when she'd need to market units for re-lease.

Answer 643

deed in lieu of foreclosure Ex. An offer of a deed in lieu of foreclosure does not have to be accepted by the lender; the lender may choose to foreclose.

Answer 644

straight loan Ex. A straight term mortgage is a type of balloon mortgage in which the last payment (the balloon) pays off the balance.

Answer 645

right of way Ex. Daniel’s driveway across Ben’s property was a right of way that enabled Daniel to get to work every day.

Answer 646

collateralized mortgage obligation (CMO) Ex. CMOs are subdivided into tranches. Each tranche has specific rules for distributing income received from the collateral, and has differing balances, maturities, and risks.

Answer 647

vicarious liability Ex. Even though Stew did not ask his agent to lie for him, the fact that his agent did put Stew at risk of being vicariously liable for his agent's actions.

Answer 648

Residential Lead-Based Paint Hazard Reduction Act Ex. Houses built before 1978 most likely have lead in their paint, so certain safety precautions need to be taken by anyone doing work on the home, and the possibility of lead paint must be disclosed.

Answer 649

cul de sac Ex. James liked living on a cul de sac because he didn’t have to deal with traffic cutting through his street to the main road.

Answer 650

grantor/grantee index Ex. One list is an alphabetical list of all the grantees, and one is an alphabetical list of all the grantors. Together, these lists establish chain of title, beginning with the current owner

Answer 651

REO Ex. Ella loved the challenge of working with investors interested in REOs.

Answer 652

statute of frauds Ex. When Ted's customer, Fred, balked at the idea of signing a contract to buy some land, Ted explained the statute of frauds.

Answer 653

lender's policy Ex. The value of the policy decreases as the loan is paid down.

Answer 654

gross income multiplier Ex. The GIM represents the ratio between the sales price and effective gross income. GIM = sales price divided by effective gross income.

Answer 655

puffery Ex. Emil loved to make his listings sound as fantastic as he could, but his broker said he crossed the line into puffery.

Answer 656

breach of contract Ex. When Caleb failed to turn over the keys to his house to Susan after the transaction closed, she sued him for breach of contract.

Answer 657

covenant of seisin Ex. The covenant of seisin guaranteed that Mary was the rightful owner of the property and had the right to sell it to Sam.

Answer 658

life estate Ex. Emma wrote her will out to include possession of her home to her nephew for the term of his life, after which it would pass to her favorite charity, Cats and Canaries.

Answer 659

lot and block Ex. When April looked up her tax record it included the lot-and-block legal description of her property, which read in part: Lawndale, Block 4, Lot 6.""

Answer 660

underwriting Ex. Brent was excited when his loan went to underwriting. Although he was asked for more information and documentation, this meant that his loan was underway!

Answer 661

broker of record Ex. XYZ Corporation provides real estate services, among other services. XYZ is required to have a broker of record to oversee its reale estate activities.

Answer 662

asbestos Ex. Many homes built before 1973 likely contain asbestos products. These might be in insulation, ceiling or floor tiles, or in exterior shingles.

Answer 663

Federal Fair Housing Act of 1968 Ex. The Federal Fair Housing Act of 1968 also created the Office of Fair Housing and Equal Opportunity.

Answer 664

functional obsolescence Ex. Because Seamus’s property was built using asbestos siding, ceiling tile and floor tile, it was functionally obsolete.

Answer 665

priority Ex. Because Debtor 36 had filed a lien before Debtors 1-35, he had lien priority, and was paid first from the proceeds of the foreclosure sale.

Answer 666

gross lease Ex. Matilda made sure her lease would be a gross lease; she wanted a fixed rent and didn't want any part in sharing the operating expenses of the home.

Answer 667

fuse Ex. Fuses are still in use in many older homes; the problem is, they give their “life” for the cause and must be replaced when they do their job correctly (because they melt).

Answer 668

1031 tax-deferred exchange Ex. Real estate investors can take advantage of the 1031 tax-deferred exchange to defer capital gains taxes when selling a property provided the money is rolled into another "like" purchase

Answer 669

principle of conformity Ex. The principle of conformity says that you don't want to build a modern home in a neighborhood of Victorians.

Answer 670

buyer's agency agreement Ex. Jerome was tired of working with disloyal buyers and decided that from now on, he would only work with buyers if they were willing to sign an exclusive buyer agency agreement with him. In that way, he could be assured of getting paid--provided he found the buyer a property!

Answer 671

devisor Ex. Marje, the devisor, willed her home to her favorite nephew after she passed.

Answer 672

Department of Veterans Affairs Ex. Scott obtained a loan guaranteed by the VA, which allowed him to get into his house for 0% down.

Answer 673

HUD median income Ex. Certain loan products are designed for those who live below the HUD median income of their area.

Answer 674

surface water Ex. Surface water is owned by the public.

Answer 675

impact fees Ex. The subdivision Cheri helped develop required her to pay impact fees to the city to help pay for the construction of offsite capital improvements.

Answer 676

sales contingency Ex. Sellers are often reluctant to accept contingent offers, and when they do, they usually reserve the right to continue to market and show the property to other buyers.

Answer 677

special warranty deed Ex. A special warranty deed often includes language such as ""by, through or under the grantor but not otherwise.""

Answer 678

encroachment Ex. Jimmy hadn’t realized that the 3-bay garage he built was an encroachment on his neighbor’s property of two feet. He would either have to move it or compensate his neighbors.

Answer 679

adjustment (loan) Ex. When the document preparation fees were more than anticipated, both sides received an adjustment at closing.

Answer 680

The Dodd-Frank Wall Street Reform and Consumer Protection Act Ex. Borrowers must receive the Loan Estimate and Closing Disclosure within their prescribed timeline prior to the real estate closing.

Answer 681

hammer price Ex. Glen was excited that the hammer price for his foreclosed property was enough to give him a little money after the lender and other costs were paid.

Answer 682

rectangular survey system Ex. Mort scratched his head at the legal description for his uncle's property, which used the rectangular survey system and read ""SW1/4 NW14 S13, T1SR20E,"" and referred to the southwest quarter of the northwest quarter of Section 13 of Township 1 South Range 20 East.

Answer 683

comparative market analysis (CMA) Ex. Gwen prepared a comparative market analysis for Jolene and told her, “Based on the sales prices of recent similar properties, I suggest a list price of between $235,000 and $250,000.”

Answer 684

mortgage fraud Ex. When Valerie misstated her income on her loan application, and her employer went along with the deceit, they were both guilty of mortgage fraud.

Answer 685

seller's agent Ex. Marissa was a seller's agent; she owed undivided loyalty to the seller.

Answer 686

improvement location certificate (ILC) Ex. Lenny Lending ordered an ILC to make sure the property they were issuing a loan for was where they thought it was.

Answer 687

millage rate Ex. Beverly’s tax rate is 150 mills and her property’s assessed value is $25,000. Her property tax calculation, then, is: $25,000 x .150 = $3,750.

Answer 688

undue influence Ex. As Nevin's guardian, Thomas was in a position to use undue influence over him in legal matters.

Answer 689

benchmark Ex. When the surveyor referenced the benchmark he noted that its numbers had worn off over time. Now he would have to use different criteria as a point of reference.

Answer 690

easement in gross Ex. The power company had an easement by gross on Sam’s street. It gave the power company the right to come on to Sam’s property, and that of his neighbors, to repair lines.

Answer 691

power of attorney Ex. Mike was going to be out of town, so he gave his brother power of attorney to sign real estate documents for him.

Answer 692

subdivision Ex. Grant Meadows was Mike Grant's subdivision. He was looking forward to not only developing but building out half of the lots.

Answer 693

sick building syndrome Ex. Some toxins, such as off-gassing of chemicals used in carpeting and other manufacturing materials, can be an issue in new construction or when remodeling. But toxins used in household cleaners can also be problematic.

Answer 694

housing ratio Ex. Because Leonard's housing ratio was too high, he had to shop in a lower price range, which would result in a lower priced mortgage.

Answer 695

risk management Ex. It is impossible to eliminate risk, but there are many ways risk management can be employed; one of these is through proper insurance.

Answer 696

insurance estimation Ex. To make sure she purchased the correct amount of insurance for her new condo, Darlene worked up an insurance estimation.

Answer 697

quiet title Ex. Because the records indicated there was an unpaid debt which created a lien against the title, even though the debt had been paid off, the Martins initiated a suit to quiet the title.

Answer 698

foreclosure Ex. The foreclosure process varies by state and can take as little as 60 days and as long as two years or more.

Answer 699

origination fee Ex. Janice paid a $3,000 loan origination fee, which was 3 points. Her neighbor got a loan from the same lender and negotiated to have the loan origination fee waived. Janice wished she'd know this was even possible.

Answer 700

right of ingress or egress The right to enter (ingress) or leave (egress) a property. Ex. Lila's easement on her neighbor's property gave her the rights of ingress and egress.

Answer 701

recession Ex. The recession was caused by high unemployment rates which reduced consumer spending.

Answer 702

pre-qualification Ex. Since it was such a hot market, Sally rejected offers that only came with pre-qualifications; she was looking for a more solid offer: One with a pre-approval.

Answer 703

zoning Ex. Due to zoning restrictions, Amelia was unable to develop a multifamily housing project on her land.

Answer 704

home inspection Ex. Becky and Jorge have made an offer on their first house. They hire a home inspector, who discovers that the foundation supports are rotting. They terminate their contract based on the inspection.

Answer 705

subdivision regulations Ex. Tiny Town’s subdivision regulations required that homes be built from 1,000 to 2,000 square feet—no more, no less.

Answer 706

limited liability company (LLC) Ex. Unlike shareholders in a corporation, the profits and losses are passed through the business to each member of the LLC. Members report profits and losses on their personal tax returns, just as business partners do.

Answer 707

interpleader action Ex. When the dispute over the escrow funds in a failed transaction rose to a head, broker Christine decided it would be best to turn the funds over the court and file an interpleader action to extricate the brokerage from the situation.

Answer 708

special use permit Ex. Although the 50-acre area was zoned for residential use, the demand for a new golf course was so great that the developer was able to obtain a special use permit to build it.

Answer 709

anchor store/anchor tenant Ex. Janice was excited to place her boutique in the same shopping center as Bloomingdales. Having such a great anchor store nearby was good for business.

Answer 710

regression Ex. Mark was pretty unhappy about the regression that occurred when his neighor left the property vacant for years. He finally called the city, ""Do something about it! My property is declining in value!"" he said.

Answer 711

testator Ex. ""Being of sound mind, I do bequeathe …"" began the testator Cheyenne Smyth, as her attorney began to take dictation.

Answer 712

construction loan/mortgage Ex. Builder Barry took out a construction loan to build out his subdivision.

Answer 713

sinkhole Ex. Sinkholes may be man-made or nature-made, and can cause damage to nearby improvements

Answer 714

party wall Ex. Tina and Louise shared a back garage wall. Tina was responsible for the upkeep of her half; Louise was responsible for the upkeep of her half. Neither could demolish the wall without the consent of the other.

Answer 715

express agency Ex. Although a verbal exchange between the parties can create express agency, it is vital that a real estate agent get an express agency agreement in writing. An oral agreement may not hold up in court if there is a dispute about whether the commission has been earned.

Answer 716

Junk Fax Prevention Act Ex. Ben violated the Junk Fax Prevention Act by spamming area fax machines with his listings, even though he had no prior business relationship with the recipients.

Answer 717

USDA Farm Service Agency (FSA) Ex. Darla's job as an underwriter with the FSA helped her approve loans for new farms and farming ventures.

Answer 718

title company Ex. XYZ Title Company examined the title for the property Bill was purchasing. When it was satisfied as to the condition of title, it agreed to insure the title, for which Bill paid the premium.

Answer 719

conveyance Ex. In feudal times, the conveyance of property was conducted on the property itself when the former landowner handed the future landowner a symbol of the transfer, such as a stone, twig or bit of soil.

Answer 720

confidentiality Ex. Sherman's client told him, confidentially, that he really had to move quickly, due to his relocation package ending soon. Because of the duty of confidentiality, Sherman cannot share this information with others.

Answer 721

legal description Ex. Although a street address may hold up in court, it's best to include an accurate legal description as best practice when conveying real property.

Answer 722

tax depreciation Ex. Due to his tax depreciation schedule, Scott was able to deduct $7,000 per year on his investment property.

Answer 723

Federal Housing Finance Agency (FHFA) Ex. In addition to its oversight and cleanup responsibilities, FHFA sets limits for conforming loans and percentage targets for loans made to low- and moderate-income borrowers.

Answer 724

investment value Ex. Investors often weigh potential investments to determine which will provide the best investment value.

Answer 725

menace Ex. Marsha's threat to cut down the seller's peach tree unless they agreed to trim it before settlement constituted menace, and invalidated the contract.

Answer 726

Gramm-Leach-Bliley Act Ex. The act limits when a financial institution can disclose a consumer’s non-public personal information to non-affiliated third parties. In addition, financial institutions are required to notify consumers about their information-sharing practices using a “clear and conspicuous” written privacy notice and must give consumers the right to opt out if they do not want their information shared with third parties.

Answer 727

joists Ex. Before her contractor gave her a bid for her second floor bathroom, he needed to see which way the flooring joists were running. “Good news,” he said, “Your joists run the right way, so I won’t have to cut through all of them to get the pipes in here.”

Answer 728

principle of contribution Ex. Just because the garage cost $75,000, David learned, didn't mean that it increased the property's value by $75,000. He learned the hard way about the principle of contribution.

Answer 729

standards for acceptable designs (SAD) Ex. The ADA periodically updates SAD, so builders and licensees working with new construction should check the ADA website for the latest guidelines.

Answer 730

Federal Trade Commission Act Ex. The FTC Act is the primary statute of the Federal Trade Commission.

Answer 731

lessee Ex. Jefferson, a tenant, is the lessee.

Answer 732

maintenance Ex. Cooperative shareholders pay a maintenance fee to pay for trash removal, landscaping and sidewalk cleaning.

Answer 733

estoppel Ex. Because Marion had given a television interview stating that her house was haunted, the legal concept of estoppel says that she cannot later state that her house is not haunted.

Answer 734

general agent Ex. A property manager is the general agent of the owner, and acts for the owner in most matters related to the property.

Answer 735

referral fee Ex. Jamie's brokerage paid a referral fee to Sue's brokerage when Sue referred Jamie a client. The fee was paid at closing.

Answer 736

unity of possession Ex. No joint tenant can have exclusive right to possess the property.

Answer 737

short-term capital gain Ex. Randy was in the 39% tax bracket. Therefore, his short-term capital gains from selling his investment property after only 10 months of ownership, were taxed at this higher rate.

Answer 738

purchase money mortgage Ex. Chet could not qualify for a loan, so he bought his uncle's land using a purchase money mortgage.

Answer 739

crowdfunding Ex. Delia made arrangements to look seriously at crowdfunding for her next development project in the city center.

Answer 740

use variance Ex. April was able to get a use variance for her property and build a duplex where the zoning ordinance had called for only single-family homes.

Answer 741

transfer tax Ex. Transfer tax may also be tax stamps applied to a deed and paid for by the buyer or seller in a real estate transaction.

Answer 742

earned increment Ex. Ina added a two-bedroom addition to her home, which resulted in a hefty increase in her property’s value.

Answer 743

post and beam construction Ex. Although rarely used in residential housing because of the expense, post and beam construction allows large expanses between supports, allowing larger window spaces and high vaulted ceilings.

Answer 744

orientation Ex. In hot climates, it may be most important to block the sun, while in cold climates, it may be best to take advantage of as much sunlight as possible.

Answer 745

Dual agency Ex. Dual agency may be either singular dual agency, where one agent represents both the buyer and seller in a transaction, or dual agency with designated agents where two agents from the same firm each represent a side of a transaction and their broker is the dual agent.

Answer 746

deed restriction Ex. Manny’s deed restriction prevented him from using his property to raise horses.

Answer 747

joint venture Ex. Before Bijou agreed to sell a real estate joint venture involving investors who expected to benefit without active participation, she looked up the definition of “syndicate” and decided to pass.

Answer 748

mutual rescission Ex. Because his funding fell through and she had another buyer, both Scott and Nina agreed to mutually rescind their contract.

Answer 749

loan origination Ex. Often, lenders will charge consumers a loan origination fee to cover the costs of making the loan.

Answer 750

point Ex. For a conventional, 30-year fixed rate loan, the interest rate may be 6% with a charge of 1 point, or 1% of the loan.

Answer 751

ground lease Ex. The property Marika was buying was subject to a ground lease; she had to pay the lessor annual payments for the land on which the home she was buying was situated.

Answer 752

partition Ex. When tenants in common don’t get along, sometimes they will ask the courts to help them partition the property: “You take your half; I’ll take mine,” is the idea.

Answer 753

municipal bonds Ex. Municipal bonds are considered a debt instrument, because when an investor purchases a bond, it’s essentially a loan to the authority that issued the bond, for which the authority promises to pay interest.

Answer 754

note Ex. Diego wants to buy Claire's Harley, but he doesn't have the cash to buy it outright. He signs a note promising to repay her in monthly installments until the bike's paid off.

Answer 755

Closing Disclosure Ex. Wendy's lender sent her a closing disclosure three days before she closed on her purchase of a delightfully renovated plantation manor.

Answer 756

thrift Ex. Freddie Mac concentrates its secondary mortgage purchases in this area, while Fannie Mae purchases mostly from larger commercial banks.

Answer 757

short sale Ex. Tallah did a short sale on her home; she owed $240,000 and it only brought $225,000. Her lender may pursue the difference in a deficiency judgment.

Answer 758

performance of a contract Ex. Without full performance of the contract, Bill's house wouldn't sell.

Answer 759

special lien Ex. When Demetria stopped paying her property taxes, the county placed a special lien on her property.

Answer 760

siding Ex. Brick is often used in place of siding in areas where it is more abundantly available.

Answer 761

freehold estate Ex. When Yvette was investigating condos in Hawaii, her friends told her, “Be sure to look for a freehold estate. You don’t want a leasehold—you can’t pass that on, and it’s not worth as much.”

Answer 762

sales contract Ex. What a busy but great week! New licensee Cade had helped his five buyer clients prepare sales contracts. Now it was time for negotiations--his favorite part.

Answer 763

easement appurtenant Ex. When Mutt agreed to allow Jeff access to his property to reach the bay, they created an easement appurtenant. Mutt’s estate became servient.

Answer 764

fair market value Ex. When a bidding war ensued, the fair market value of all properties in the city shot up.

Answer 765

reconveyance Ex. Once Albert had made his final loan payment, the lender reconveyed his deed back to him - Albert owed his home free and clear!

Answer 766

septic system Ex. Cally’s septic system backed up when untreated liquid water clogged the absorption field of the system.

Answer 767

client Ex. Nicole was selling her house and hired Krystal as her listing agent. Nicole is Crystal's client.

Answer 768

property management agreement Ex. Property manager Duke was stoked when his first-ever client, Offices R Us, signed a property management agreement with him for one of their office parks.

Answer 769

affidavit of title Ex. An affidavit of title is often a part of a bring down, a title search performed after closing and before any new documents are filed.

Answer 770

escheat Ex. When Rhonda passed away, she had no will, no heirs and no creditors. The state took possession of her mobile home and collection of Elvis paintings through the power of escheat.

Answer 771

ridge beam Ex. If Superman were stradding the top of a house, he's be sitting directly on the ridge beam.

Answer 772

universal agent Ex. As guardian for her nephew, Shawna acted as his universal agent in all matters.

Answer 773

general warranty deed Ex. Nellie was nervous about accepting a deed that was not a full covenant and warranty deed. She was worried that her title might be impacted by another’s claim or an unknown encumbrance.

Answer 774

agent Ex. An agent owes the principal (or client) certain fiduciary duties.

Answer 775

inverse condemnation Ex. After flooding damaged a county-maintained road, Dee's access to her property was blocked. The county failed to repair the road, so Dee made a claim for inverse condemnation, seeking restitution for the loss of her property rights.

Answer 776

discount points Ex. Xavier decided to purchase 2 discount points to reduce the interest rate on his mortgage from 6% to 5.5%.

Answer 777

power of sale Ex. The bank was able to foreclose on Monica's home without taking the matter to court because Monica gave them power of sale in her security deed.

Answer 778

adjustment date Ex. Karey made sure to refinance before her adjustment rate. Rates had dropped and she could get a better rate than the one she'd face once her ARM adjusted.

Answer 779

abutting Ex. Many neighbors find that fences make abutting properties more tolerable.

Answer 780

subordination agreement Ex. Lenders will sometimes agree to subordinate their mortgage lien to another mortgage if they are certain the property value will pay off both mortgages if foreclosure becomes necessary.

Answer 781

implied agency Ex. It is best to avoid implied agency; instead, get any agency agreements in writing so there is no confusion about representation.

Answer 782

Loan Estimate Ex. Carla received the Loan Estimate from her lender two days after applying. She liked how obvious things like the interest rate and approximate payment amount were on the sheet - she really hated having to rifle through her purse for her reading glasses.

Answer 783

HUD/Department of Housing and Urban Development Ex. Every HUD-assisted project must be examined to ensure that it does not negatively impact the surrounding environment and that the site itself will not have adverse effect on end users.

Answer 784

fiduciary Ex. A property manager is the fiduciary agent of the owner; as such the property manager must act in the owner’s best interest.

Answer 785

mortgagor Ex. John took out a mortgage with ABC Bank. ABC was the mortgagee; John was the mortgagor.

Answer 786

fixed-rate loan Ex. Fixed-rate loans were seen as a safer choice after adjustable-rate loans contributed to the mortgage crisis of the late 2000's.

Answer 787

net operating income (NOI) Ex. Larry checked his net operating income. After deducting for vacancy loss, uncollected debt and operating expenses, he would make 15% this year!

Answer 788

sheathing Ex. Mike Grant used wafer board for sheathing on his exterior framing. On top of that he put wood or stucco and stone.

Answer 789

price fixing Ex. An agreement to charge a ""standard"" brokerage fee is price fixing and is an violation of antitrust law.

Answer 790

market rent Ex. Since the market rents downtown had skyrocketed, Ansley decided to look for her new rental space in the suburbs.

Answer 791

personal property Ex. Mia was surprised to learn that the sellers took the freestanding fountain with them. She hadn’t realized that it was personal property.

Answer 792

subordination clause Ex. When Amanda opened a home equity line of credit, the document inscluded a subordination clause, making the HELOC secondary to her senior mortgage.

Answer 793

nonconforming use Ex. Jack had had a shoe shop on Kelly street for 10 years when the entire area was zoned residential. Luckily, his nonconforming use was still allowed, but if he sold his shop, the new owner would likely have to use the property as a residence.

Answer 794

compaction Ex. Compaction inhibits plants from growing on the property and impedes proper drainage, which can wreak havoc on foundations, flood basements, and make buildings unstable and unsafe.

Answer 795

marketable title Ex. Although Karen’s title had a small lien on it for her outstanding mortgage, she would be paying that off at closing, so she had a marketable title.

Answer 796

Real Estate Settlement Procedures Act (RESPA) Ex. RESPA requires borrowers to be provided with a good faith estimate within three business days of receiving a completed loan application.

Answer 797

real estate investment trust (REIT) Ex. Craig's favorite REIT invested in mortgages.

Answer 798

consideration Ex. Carly is a buyer and Wade is a seller. Carly gives Wade earnest money and a promise to purchase his property. This is her consideration. Wade’s consideration to Carly is his agreement to sell his property.

Answer 799

adjustable rate mortgage (ARM) Ex. Caleb had a 5/1 ARM. His loan had a fixed interest rate for the first five years, and after 5 years, it could change annually depending changes to the market index.