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Hawaii Real Estate Test > Hawaii Test > Flashcards

Hawaii Test Flashcards

(114 cards)

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1
Q

What is UCC

A

Uniform Commercial Code used to file lien on personal property (not fixtures) for a loan - used by commercial lease (fridge) through bill of sale

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2
Q

What is Right of Election

A

allows surviving spouse to claim 3-50% of estate based on time married for homestead property and deceased exclusively owned property. Must is completed in a time period and not transferable (replaced dower and curtesy.

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3
Q

Who are Reciprocal Beneficiaries

A

Tenancy by Entirety for husband and wife Equal, undivided interest as though the were one owner. Spouse gets through right of survivorship. Fractional ownership cannot be conveyed to 3rd parties unless agreed by both parties
Foreclosure only on joint debt
Terminated by death, party agreement, divorce or court order sale

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4
Q

Tenancy in Partnership

A

Ownership held by business partners (general partners) under the Uniform Partnership Act where partners are granted equal rights but the property must be used in connection with the business and individual rights are not assignable. Limited partners not liable.

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5
Q

Real Estate Partnerships

A

Real estate partnerships - under direct management of principal broker (general partner and holds broker license)

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6
Q

Real estate Corporations

A

Officer or employee must manage and have broker license

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7
Q

Land Trusts

A

Real estate is the only asset and Trustor is normally the beneficiary. The deed in trust grants the beneficiary right of possession and control over the trustee. The beneficiary is also not on record and their interest is personal property. Entrity in severalty.

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8
Q

Condominiums

A

Own fee simple in title to interior airspace of unit only and proportional % share of common elements with all other owners as Tenants in Common and can’t be separated (no charge for common elements). limited common elements (parking spot) are pertinent to specific units Developer provides declaration, final public report (Disclosure Statement) , rescission period 30 days.
New buyer may require approval of association

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9
Q

Condominium Development

A

Master Deed with Declaration of provisions

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10
Q

Resales of Condominiums

A

Resales remove the Public Report and require a standard sales purchase agreement and seller’s disclosures
0 days rescission
Associations provide RR105C disclosure statement

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11
Q

Condominium insurance

A

Liability insurance can be required by the association (HOA)

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12
Q

Condominium Disclosure Form

A

RR105C
Supplied by the association

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13
Q

Cooperatives

A

Shares in non profit corporation with Proprietary lease (owner has share in company and pays no rent) as personal property with control by association who owned property. Ratio of leased interest as percentage of overall company value = unit value. Plus pays prorated expenses for running coop.

Foreclosure would be over whole property and if occurs terminates the proprietary lease

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14
Q

Timeshare

A

Time share lease - rented on scheduled basis over agreed time and period (10 years)
Time share freehold - tenants in common with undivided interest in property with prorated expenses. Right to partition is removed

7 day rescission, mutual right to rescind. Unlicensed acquisition agent promotes attendance to sales presentation for a gift for attending. Gift given at any time.

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15
Q

Who administers Timeshares

A

Time Share administrator appointed by DCCA (department of commerce and consumer affairs)

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16
Q

DCCA

A

Department of Commerce and Consumer Affairs. Administers, registers and enforces Hawaii laws relating to corporations, partnerships, securities, franchises, and the registration of trade names and trademarks and service marks.

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17
Q

Prescriptive easement

A

20 years and must be:
Not secret (open, notorious and visible)
No permission given (hostile and adverse to owners interest)
Exclusive to the party making the claim
Continuous and uninterrupted. Does not change boundaries or give title.

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18
Q

Tax liens

A

Lien until tax is paid and 1st in payment. If delinquent 3 years state can foreclose with public auction (expenses paid 1st). Statutory redemption within 1 year

Superior liens include
Real estate tax liens
Special assessment liens
Federal estate tax liens
State inheritance tax liens

Junior liens
Federal and state income tax liens
Judgment liens
Mortgages
Vendor and mechanic’s liens

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19
Q

Mechanic’s and Materialman’s lien

A

Mechanics Lien is a specific involuntary lien filed when contracted work has not been paid for. Priority is commencement of work
Person filing must have furnished material, labor specifically for the job where lien attached
Lien must be filed within 45 days after date of completion of improvement (notice of improvement)
Liens for wages are prioritized up to $300

Specific Lien attached to specific property

Vendor’s/seller’s lien secures a purchase money mortgage for a buyer of the property

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20
Q

Judgment liens

A

Statutory lien in an involuntary order by law
Equitable lien is a involuntary lien by court judgment

Ordered by the court and within statutory 10 years. Recorded at bureau of conveyances/land court. Once satisfied, debtor can file satisfaction of judgment to remove embumberance.

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21
Q

Subordination agreement

A

Changes priority of Liens

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22
Q

Mineral rights

A

Reserved to state

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23
Q

PASH

A

Public Access shoreline Hawaii - can go on property for traditional rights. Title companies (ESCROW) can exempt themselves from claims

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24
Q

Shoreline property boundaries

A

High water wash of waves is seaward boundary. Setback 20-40’

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25
Homeowners Tax Exemptions
Mortgage interest payments in 1st and 2nd homes, Real estate taxes, Loan origination fees, Loan discount points, Loan repayment penalties. Capital gains tax for profits on sale of principal residence 500,000 married couple, $250,000 single person for 2 years out of last 5 years
26
SMA
Special Management Area by coastline where development needs more hearings and permits to prevent harm to beaches, oceans and creatures. Know flood hazard, shoreline setbacks or tsunami zones
27
Easements
Create written agreement between parties with; Dominant tenement benefits Servient tenement benefits Easement by Necessity Easement by Prescription Easement by Necessity not permitted in HI No adverse possession if land court or over 5 acres
28
Appurtenance
Something that is considered a part of the property, is sold with the property, and it is passed on to the new owners
29
CC&R
Covenants Conditions and restrictions (deed restrictions) run with the land and cannot be removed
30
De Minimis
Resolves conflicts (encroachment agreement) between old and new surveys Commercial, Industry, multi unit residential 3” Residential 6” Agricultural and Rural 9” Conservation 18” Not encroachment for any zoning violations or adverse possession claims (trespassing)
31
Independent Contractor Licensee
Commission only (no withholding for tax or social security) Freedom to set hours Broker has liability for their work Must comply with IRS requirements for qualified real estate agent 50-100% commission plan only paid by employing broker. Can be regulated by Real Estate Commission and broker to protect the public
32
Employed licensee
Salary not commission Benefits such as health cover etc Broker withholds tax and social security Broker sets hours and duties Broker has liability for their work
33
REC
Real Estate Commission 9 members what are US citizens and 3 years state resident 4 must be real estate people with 3 years in business 4 from Oahu, 1 from Maui, Hawaii and Kauai and 2 public = 9 4 year term and no pay
34
Broker rules
Must retain records for 3 years including Client Trust Account Records
35
License renewals
All licensees must inform REC if they change name, address, firm (10 days) on change form Broker files all name, address, branch office, officers and director If broker license is not active then all licensees are inactive in brokerage
36
FSBO
For Sale By Owner - Not allowed if licensed real estate person
37
License Revoked
Intentional misrepresentation of the facts/property description etc Negligent misrepresentation if the agent should have reasonable know and declared the facts Misrepresentation of Expertise where the agent provides opinion outside of their field of duty undisclosed dual agency, accepting payment from person other than own broker. Up to 5 years for revoke or suspension
38
RICO
Racketeer Influenced and Corrupt Organizations Act. The watchdog for service providers in industries and occupations that are regulated by a professional or vocational licensing board within the Department of Commerce and Consumer Affair
39
Agency disclosure
Disclosure of all material facts that agent should know (opinion of property condition, buyer’s motivations and financial status, open disclosure of relationship with other buyers, title defects, environmental hazards and defects) Must be made at each of (3 times) 1-obtain listing, 2-prepare contract, 3-present contract
40
Broker license application
Experience as licensed salesperson for 3 of 5 years immediately prior to licensing exam.
41
Outside Public Contact (OPC)
Acquisition agent for a timeshare developer. Unlicensed but works for developer and cannot sell timeshares.
42
Listing and Sales Contracts
All parties should sign and all terms are negotiable. Pre sales contract to seller licensee must disclose listing broker, If For Sale by Home Owner who the selling brokerage represents. Agency disclosure must be confirmed a separate title paragraph in no less than 10 point bold Disclose buyer agency to seller or listing brokerage before negotiations start
43
Agreement of Sale???
Buyer gets equitable title until second closing, then gets legal title with conveyancing tax
44
Plain language act
Property under $25,000 for personal, family or household purpose or lease less than 5 years written in clear common language
45
Mandatory Sellers Disclosures
Responsibility of seller only. Buyer can rescind if not given or continue with sale. (a) signed and dated by the seller within six (6) months before or ten (10) calendar days after the acceptance of a Hawaii real estate purchase
46
Megan's Law
Sex Offender Registration Megan’s Law - state version requires sex offenders to register attorney general’s office Government will not publicly release info Seller or agent makes representations whether or not public has access to information
47
Fixtures
Inclusions in Purchase Contract are binding regardless of what listing says.
48
Statute of limitations
libel, nondisclosures 2 years Fraud-4 years Recovery of debt- 6 years Judgment liens-10 years Adverse possession, prescriptive easement-20 years
49
Time is of the essence
Timely performance, failure to perform in a timely manner amounts to a material breach of contract giving rise to the other party's right to exercise its remedies for breach (time limitations such as 1031 exchange)
50
Walk throughs
J3 - Done before closing to confirm property condition, agreed repairs etc. Walkthrough can be waiver
51
Condominium Public Report
Discloses all material facts. Providing purchasers 30 days rescission right. Report non-expiring until the last unit sold. Annual report to update Public Report of any material changes until all units sold. Resales replace Public Report for standard sales purchase agreement and seller’s disclosures 0 days rescission (Associations provide RR105C disclosure statement)
52
RR105C
Property Information Form includes; property description, managing agent information, general and legal, insurance information, financial information and property condition
53
Subdivision Public Offering Statement
Describes properties of the subdivided land with material circumstances or features Registered by the DCCA Purchasers have 7 days to rescind Any amendments to POS require further 7 days to rescind Subdivider must file annual report every 12 months showing any material changes since registration Can’t distribute money to subdivider until registration is complete Exemptions: Sold by purchaser for own account Fewer than 20 lots offered in 12 months or bonded Building on the land or requirement to build within 2 years Persons in construction building for resale Court order By government agency As cemetery lots Established as condo (has own rules under 514) Foreclosure of mortgage
54
Contract Termination
Void - Can't perform valid services Under duress/disability Breach Completion Rejection Revocation Time lapse Death/insanity Contingencies
55
Novation
Replacement/substitution of old contract
56
Option to buy contracts
Allows a potential seller (optionor) grants a potential buyer (optionee) the opportunity to buy the property by a certain time and an agreed cost and terms. If the buyer goes ahead the option payment is deducted from the earnest money. This is a unilateral agreement that becomes a bilateral agreement once the option is exercised. No obligations on the optionee (buyer) but the seller must perform if the option is triggered. Deposit is lost if buyer does not go ahead. Can be used in commercial transactions also to allow buyer to investigate zoning, permits etc (equitable interest).
57
Contingencies
Appraisal, mortgage, title and home inspection contingencies. Many home buyers also include a sale of prior home contingency
58
Recording
Recordings are in county of real estate location and gives constructive notice and the priority of any liens Torrens system in the land Court must be entered on certificate of title
59
Bureau of Conveyances
Regular system - Deeds are recorded with lot and block number. Land court (Torres system) - Lot number, map number and TCT (Transfer Certificate of Title) to be legal, description must allow surveyor to locate and identify property properly
60
DLNR
Department of Land and Natural Resources
61
Land court title search
Title search or lien (letter) search where tile is for property only and lien is for all liens and financial encumbrances. A property may be registered in Land court and recorded in Regular system (double system).
62
Conveyancing Tax
Paid by seller and must be paid at 1st closing. Amount depends on (1) sales price, (2) whether BUYER is owner occupant
63
Plat and Parcel System
Plat books = legal description/maps of subdivided land Divided into blocks lots and parcels Recorded a the Bureau of Conveyances Street addresses and TMK numbers are not sufficient as they are subject to change
64
TMK
Tax Map Key Not legal description (Division then Z-A) Division (Oahu 1, Maui 2, Hawaii 3, Kauai 4) Zone Section 640 acres (acre = 43560 sq f) Plat Parcel CPR (Condominium Property Regime) TMK books kept at each county Real Property Tax Office
65
ALTA policy
Extended title coverage policy for mortgagee. Covers off record risks like those discoverable by physical inspection (encroachments) or arising after date of insurance (mechanics liens). Requires survey. Coverage declines as property is paid off.
66
Metes and Bounds
Used in HI, starts at a POB (point of beginning) Metes provides distance and direction and Bounds provides fixed reference points such as natural or manmade landmarks), it then ends at the POB. Uses Datum’s to show height reference points
67
Adverse Possession
20 years, hostile, open, notorious exclusive, continuous, claim under right. Changes boundaries and gives ownership to the land
68
Cloud Title
Get clear title by filing a civil lawsuit in a court of law to seek Quiet Title resolving the cloud on the title.
69
Quiet Title
Lawsuit to confirm ownership, fix a title error, or settle an ownership dispute. The end result is a court order clarifying or confirming who owns the subject property. In other words, a quiet title fixes the chain of title
70
Foreclosure
No statutory right of redemption unless tax foreclosure. Expenses of sale paid first before anything, even taxes. Judicial foreclosure used on mortgages where they do not contain power of sale and file for court hearing. Acceleration to pay off immediately Lis Pendens - Public notice of pending judgment suit Writ of execution authorized official such as sheriff seize and sell property
71
Usury
Laws limiting interest rate on excessive loans, penalized to lose all interest of the entire loan HI Usury applies only to second financing/mortgages and loans between private parties and is set at 12% maximum. Not applied to loans carried back by a seller to help a buyer finance their loan (seller has interest in property being sold)
72
FHA
Federal Housing Administration
73
FHA Loan
Government-backed mortgage insured by the FHA (paid by mortgagor). Used on approved condos
74
VA Loans
Veterans Administration loans to help Veterans, Servicemembers, and eligible surviving spouses, don't require mortgage insurance. Used on approved condos
75
Hula Mae Loans
Hawaii Housing Finance and Development Corporation (HHFDC) individual Mortgage Loan Program and assistance toward making the down payment. must be owner occupied property (house or condo) and resident of Hawaii, US citizen, 18 years or older, not have previously had a Hula Mae loan, not owned principal residence for 3 years prior to applying for loan, income limitations.
76
ERS
Employment Retirement System loan for borrowers that are employee of state or county
77
Reverse Annuity Mortgage
Receive monthly income based on loan. Must pay off when person dies.
78
MRFPA
Mortgage Rescue Fraud Prevention Act -prevents agent from buying listing for 1 year after listing agreement.
79
Loan contingency
Buyer does not get the loan (not qualify) buyer may cancel and get earnest money back. H2 contingency
80
HARPTA
Hawaii Real Estate Act - If not a HI resident, 7.25% withheld by buyer and sent to state tax department. Resident Certification (form N-289)
81
FIRPTA
Foreign Investment in Real Estate Act - If not a citizen, 15% withheld by buyer and sent to IRS
82
Good Funds Act
All funds are good-checks cleared and on deposit to close transaction. (wired funds or cashier’s check 10 days before)
83
Real Property Taxes
Calculated on ad valorem amount. Assessed value rate divided by 1000 x rate Homeowners eligible exemption on personal residence (owner occupied). Have exemption and different rate.
84
Property tax exemptions
Filed for owner occupant status by December 31 of year preceding effective date expected.
85
State Zoning
Urban - Residential, apartments, resorts, industry, commercial, preservation Rural - ½ acre min lot size, low density residential development under LUC and county Agricultural - under LUC and county restricted to farms, ranches etc Conservation - administered by DLNR (Department Land and Natural Resources), forests, water reserves - Can still build one dwelling (see land agent) No Sewered areas minimum lot size 10,000 sq f, no new cesspools, all septic tank systems now required.
86
LUC
Land Use Commission oversees state wide zoning
87
Ohana Dwelling
Must meet zoning requirements whether attached or detached Not allowed in single family zoning May be a permitted structure but may not have permitted use Nonconforming may be forced to tear down
88
Family Child Care Homes
3-6 children unrelated to caregiver
89
Planned Housing Developments/PUD
Special zoning to maximize space where common elements are not owned but maintenance is paid. Community Association fees and rules apply Other - Mixed use, converted, manufactured and factory built houses
90
ULSPA
Hawaiian Uniform Land Sales Practices Act Protects buyers of undeveloped lots (subdivisions) form unscrupulous practices
91
Fair Housing Act
Civil Rights Acts of 1968 Fair Housing Act created to protect classes race color religion national origin updated in 1988 with more protected classes enforced by State Civil Rights Commission. When Federal and HI anti-discrimination laws differ, the stricter prevails.
92
Exemptions to Fair Housing Act
Owner occupant with four less units Single-family housing sold or rented without broker Housing offered by private club that limits occupancy to members with no discrimination becoming a member Single family home owned by person who doesn't owe more than three Homes at a time Discriminatory advertising cannot be used. ‘Steps from the beach’ is discriminatory Broker cannot be used
93
Service animals
Are allowed even though there is a no pets rule in condo.
94
Residential leases
Lease is a contract between owner (lessor) and tenant (lessee). Transfers rights to exclusive possession for specific period of time Retains reversionary right to possession after term All leases for one year plus must be writing (Statute of Frauds) Leasehold estate tenants rights to possess real estate for term of lease Hawaii leasehold condos lessee has duties of ownership Lease survives a sale
95
Residential leasehold disclosure statement
Provided to all purchasers of leasehold property as well as lease, and summary and glossary of terms all within 10 days of acceptance. No Rent Control in Hawaii
96
Leasehold Ads
Must state “leasehold”, not just LH.
97
Leasehold Taxes
Taxes- Landlords pay 4% (plus county surcharge) General Exercise Tax for rent received. Can be added on to rent received but must be stated in rental agreement
98
TAT
Transient Accommodation Tax (10.25%) if transient rental (less than 180 days) must be paid by landlord (can be passed on)
99
GET
General Exercise Tax
100
Retaliatory eviction
Punishing tenant for complaining to Health Department
101
Lease Contract
Lease survives the sale If over a year must be in writing. Oral agreement creates a month to month. Security deposit cannot be more than 1 month rent 14 days to return or say why after tenant vacates or tenant gets security deposit back
102
Comingling
All money that belongs to others must be deposited in client trust account. Anyone can put money in but just broker out
103
Agency disclosure
Listing brokers must disclose If 1. seller authorizes listing firm to appoint subagents 2. seller authorizes listing firm to share commissions with subagents, selling and buying agents 3. Must be in writing and signed by seller and listing broker firm Prior to presenting sales contract to seller licensee must disclose 1. Who listing broker represents 2. If For Sale by Home Owner who the selling brokerage represents 3. Agency disclosure must be confirmed a separate title paragraph in no less than 10 point bold 4. Disclose buyer agency to seller or listing brokerage before negotiations start 5. Compensation not determined by agency
104
Seller’s Real Property Disclosures
HRS 508D Specific (4) –flood hazard zone, noise of public airport, military airport, tsunami zone. Property Information Disclosure (Form RR105c) for condos filled out by property mgr. Electricity Cost disclosure Planned Community Association Disclosure Release or waiver of construction defect disclosure
105
Leasehold Property Disclosure
Statement plus copy of lease agreement. Prepared by attorney and includes a plain english terms of lease, renegotiation dates and process, expiry date and surrender clause
106
Hawaii Association of Realtor forms
Listing (exclusive right to sell) Purchase contract Seller’s Real Property Disclosure Statement Receipt of Disclosure Statement Buyers Representation Contract Cooperating Brokers Agreement Agreement of Sale Purchase Money Mortgage Plain Language Act
107
Distressed Property
Foreclosures in non judicial mortgages through power of sale which gave no time for loan modification or short sale relief. Converting to judicial foreclosure allowed time to resolve short sale. Mortgage Rescue Fraud Protection Act regulates this
108
Short Sale
Liens and costs on property exceed sales price. Seller will ask for lien release to complete sale and pay off debts
109
HRS 436B
Uniform Professional and Vocational Licensing Act for all regulated licenses grounds for loss of license
110
HRS 467
Real estate licensing law
111
Property Valuations
A licensee may give an opinion of value of a property and may charge for this opinion.
112
What 4 things must be in a real estate ad?
Name of firm, status of agent, whether property is leasehold, licensees license name if given
113
If property is advertised on different island than registered brokerage what must be disclosed in the ad?
Address of the registered brokerage)
114
Sales Offers
Must be transmitted immediately to seller by listing broker when they get it

Hawaii Real Estate Test (2 decks)

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