MISC WORDS Flashcards

Question

RESTRICTIVE COVENANTS (PG 27)

Answer 1

Glossary | A clause in a deed that limits the way the real estate ownership may be used.

Answer 2

DENSITY ZONING ordinances RESTRICT THE AVERAGE MAXIMUM NUMBER of HOUSES PER ACRE that maybe build with any particular subdivision. GROSS DENSITY refers to the AVERAGE NUMBER OF UNITS in the development remains AT R BELOW the maximum density the average is called the gross density

Answer 3

The US CONGRESS created the Interstate Land Sales Full Disclosure Act to prevent fraudulent marketing schemes that may arise when land is sold without being seen by the purchaser. The act is regulated by THE SECRETARY OF HUD through the office of interstate land sales regulations. -Sellers are required to file statements of record with HUD before they can offer unimproved lots in interstate commerce by telephone or through the mail. -The states of record must contain numerous disclosures about the property.

Answer 4

``` - TYPE OF TITLE being transferred to the buyer - number of homes currently occupied on the site - availability of RECREATION FACILITIES - distance to NEARBY COMMUNITIES - UTILITY SERVICES and charges - soil conditions (swamp land) - foundation or construction problems ``` If the purchaser or leesee does not receive a copy of the report BEFORE signing the purchase contract or lease the consumer may have grounds to void the contract

Answer 5

EXEMPTIONS INCLUDE -subdivisions consisting of fewer than 25 LOTS or in lots of 20 ACRES or more. - lots offer for sale solely to developers are also exempt - lots on which buildings exist - where the seller is obligated to construct a building within two years. Any contract to purchase a lot covered by this act may be revoked at the purchasers option until MIDNIGHT of the 7 DAY following the signing of the contract If a contract is signed for the purchase of a lot covered by the act and a property report IS NOT given to the purchaser, the purchaser may bring an action to revoke the contract within 2 YEARS. If the seller misrepresents the property and any sales promotion, a buyer is entitled to sue the seller for CIVIL DAMAGES. Failure to comply with the law may also subject a seller to CRIMINAL PENALTIES and or FINES and IMPRISONMENT

Answer 6

PRIVATE CONTROLS are created by an owner or a private entity, such as in subdivisions - Cannot violate local, state or federal law. - General rule is that more restrictive of the two takes precedence - Restrictions that control and maintain the desirable quality and character of a property or subdivision may be created by PRIVATE ENTITIES, including OWNERS THEMSELVES PUBLIY CONTROLS are exercised by the government

Answer 7

DEED RESTRICTIONS & RESTRICTIVE COVENANTS DEED RESTRICTIONS: -LIMITATIONS to the use of the property by a PAST OR CURRENT OWNER - binding on future grantees. Examples: - a restriction specifying the kind of structure that may be erected on the land - requirement that a property be used for a specific purpose - a prohibition of specific use - Often NO time limitations RESTRICTIVE COVENANTS commonly known as covenants conditions and restrictions CC&R’S are - They are a DECLARATION OF CONDITIONS & RESTRICTIONS that affect the use of all parcels of land within a SPECIFIE DEVELOPMENT OR SUBDIVISION PLAT. -CC& R’S are typically found in a separate recorded instrument. - The deed to EACH AFFECTED PROPERTY references the plat or declaration of restrictions. -CC& R’S typically governed the type, height, and size of buildings that individual owners can erect, as well as land, architectural style, construction methods, setbacks, and square footage. - CC& R’S are enforced by homeowners associations - CC& R’S OFTEN HAVE time limitations For example they may be effective for 25 years.

Answer 8

GENERAL WARRANTY DEED provides the greatest protection of any kind of deed by binding the grantor to certain covenants and warrantees SPECIAL WARRANTY DEED contains two basic warranties, - that the grantor received title and - that the grantor did not encumber the estate except as stated in the deed BARGAIN & SALE DEED Carries with it no warranties but implies that the grantor holds title to the property QUITCLAIM DEED Carries with it no warranties whatsoever and conveys only the interest, if any, that the grantor possesses in the property

Answer 9

1) provides the greatest protection to the buyer - Grantor is legally bound by certain covenant’s promises or warranties. Warrantees are implied by the use of certain words specified by statue of the grantors warrantees & expressly written into the deed itself. State laws should be examined, some of the specific wording include “convey in warrant” or “warrant generally” 5 COVENANTS OF A GENERAL WARRANTY DEED - covenant of SEISIN which means possession. - “ “ against encumbrances - “ “ of quiet enjoyment (Guarantees title is good against third parties who might bring a court action to establish superior title to the property. If title is found to be inferior the grantor is liable for damages - “ “ of further assurance meaning the grantor will fix anything if it needs to be fixed - covenant of warranty forever The covenants extend all the way back, they are not limited to the time only the grantor owned the property.

Answer 10

(Unlike the General warranty deed, where that is guaranteed all the way back, the special warranty deed, the grantor only defend the title against themselves) SPECIAL WARRANTY DEED contains two basic warranty’s: -1) the grantor received the title. -2) the property was not encumbered during the time the grantor held the title, except as noted in the deed - The grantor defends the title against themselves. - Granting clause generally words “grantor revises, releases, alienates, and conveys“. - Grantor may include additional warranties, which must be specifically stated in the deed. - the purchase of title insurance is viewed as providing adequate protection to the grantee -May be used by fiduciaries such as trustees, executors, and corporations. -Appropriate for fiduciaries because they lack the authority to warrant against acts of predecessors in title (former owners). A fiduciary might hold the title for a limited time without having a personal interest in the proceeds. Sometimes a special warranty deed is used by a grantor who is acquired title at a tax sale.

Answer 11

BARGAN & SALE DEED contains NO EXPRESS warranties against encumbrances. - It DOES IMPLY that the grantor holds title and possession of the property. - Granting clause usually states a person‘s name or the name of the entity - words used “grants and releases or grants, bargains, and sells. - Since warranty is not specifically stated, the GRANTEE HAS LITTLE legal recourse if the title defects appear later in some areas this deed is used in foreclosures and tax sales. - Buyer should purchase, or the seller provide, title insurance for protection.

Answer 12

QUITCLAIM DEED renouncing claim to land. - One of the most common uses is a simple transfer of property from one family member to another - provides the least protection of any deeds. - no covenants or warrantees - generally conveys only whatever interest the grantor may have when the deed is delivered. - If the grantor has no interest the grantee will acquire nothing or will the grantee acquire any right of warranty claim against the grantor. - can convey title as effectively as a warranty deed if the grantor has good title when the deed is delivered, BUT it provides none of the guarantees of a warranty deed. The grantor only remises, releases, and quitclaims the grantors interest in property if any. - Usually IS THE ONLY type of deed that may be used to convey less than a fee simple estate. This is because it conveys only the grantors right, title, or interest. Often used to cure a defect, or a cloud on the title. For example if the name misspelled on a warranty deed filed in the public record, a quit claim deed with the correct spelling may be executed to the grantee to perfect the title. Also used when a grantor allegedly inherited property but is not certain that the descendants title was valid. A warranty deed in such an instance could carry with it obligations of warranty while they quit claim deed would convey only the grantors interest, whatever it may be.

Answer 13

WHAT ARE CHARACTERISTICS OF A LEASE HOLD ESTATE? -Tenants use real estate for a TERM of the lease (less than freehold) -Is generally considered personal property

Answer 14

LIFE ESTATE: (while they are alive,during their lifetime) A freehold estate that is limited in duration to the life of the owner or to the life of some other designated person or persons. - IS NOT INHERITABLE. - It passes to future owners ACCORDING TO THE PROVISIONS of the life estate. CONVENTIONAL LIFE ESTATE - Created by the intentional act of the owner. - Established either by DEED, OWNERSHIP TRANSFERENCE during the owners life or by a WILL after owners death. The estate is conveyed to an individual known as a “life tenet”, who has full enjoyment of the ownership until the death of the person. UPON OWNERS DEATH the life tenants rights CEASES and the ownership passes as a fee simple estate to another designated individual or returns to the previous owners or heirs. Until the life’s tenets right ceases, the right to the fee simple estate is known as “inchoate”, meaning that the right is incomplete or the rights exist but is not fully exercised until sometime in the future. - A Life tenant is not a renter. - They ARE entitled to rights of ownership and can benefit from both possession and ordinary use, and profits arising from ownership, just as though the individual or a fee simple owner. - The life tenets ownership may be sold, mortgaged, or leased, but is always subject to the LIMITATIONS of the life estate. PUR AUTRE VIE FRENCH FOR LIFE OF ANOTHER Allows a person to remain (often handicapped) until the duration of THEIR life) -A life estate may also be based on the LIFETIME of a person (handicapped person) other than the life tenant. Although a LIFE ESTATE IS NOT CONSIDERED AN ESTATE OF INHERITANCE, a life estate PUR AUTRE VIE, “for the life of another”, provides for inheritance by the life tenant heirs only until the death of the third-party. (HEIRS GET IT AfTER 3RD PARTY DIES) -A life estate PUR AUTRE VIE is often created for people who are physically or mentally incapacitated and the hope of providing incentive for someone to care for them. LEGAL LIFE ESTATE (STATUTORY) -is NOT created voluntarily by an owner. - It IS a form of life estate ESTABLISHED by state law. - Automatically becomes effective when certain events current occur. - DOWER(woman) CURTESY (man) & homestead are the legal life estate currently used in some states.

Answer 15

PUR AUTRE VIE FRENCH FOR LIFE OF ANOTHER Allows a person to remain (often handicapped) until the duration of THEIR life) -A life estate may also be based on the LIFETIME of a person (handicapped person) other than the life tenant. Although a LIFE ESTATE IS NOT CONSIDERED AN ESTATE OF INHERITANCE, a life estate PUR AUTRE VIE, “for the life of another”, provides for inheritance by the life tenant heirs only until the death of the third-party. (HEIRS GET IT AfTER 3RD PARTY DIES) -A life estate PUR AUTRE VIE is often created for people who are physically or mentally incapacitated and the hope of providing incentive for someone to care for them.

Answer 16

The fee simple owner who creates a life estate must plan for its future ownership. When the life estate ends, it is replaced by a fee simple estate. The future owner of the fee estate maybe designate it in one of two ways. - REVISIONARY INTEREST / NO REMAINDER MAN NAMED - In this case, ownership is said to revert to the original owner upon the end of the life estate. - REMAINDER INTEREST / THE REMAINDER MAN HAS BEEN DETERMINED The creator of the Life estate may name a remainderman as a person to whom the property will pass when the life estate ends.

Answer 17

Pennsylvania Probate, Estates, and Fiduciary code CREATES A LEGAL LIFE ESTATE for the SURVIVING SPOUSE of a deceased owner. -The surviving spouse is permitted to 1/3 of the value of the deceased spouses estates at the time of death. - The surviving spouse has the option of taking the specified percentage of the estate in lieu of the amount that is directed by the deceased will...... (Continued see book)

Answer 18

DOWER is the woman, and CURTESY is the man - PROVIDES THE NON OWNING spouse with a means of support after the death of the owning spouse. DOWER is the life estate that a WIFE has in the Real Estate of her deceased husband. CURTESY is an identical interest that the husband has in the real estate of his deceased wife.

Answer 19

2 General classifications of encumbrances LEINS & ENCUMBRANCES - LEINS usually a mortgage charges. - A charge against a property that provide security for a debt or obligation of the owner. -If not satisfied the lienholder could be entitled to a court ordered or for sale. -Real estate taxes, mortgages and TRUST DEEDS, judgments and mechanics liens all represent possible LEINS - ENCUMBRANCES / A claim, charge, or liability that attaches to real estate such as RESTRICTIONS, EASEMENTS & ENCROACHMENTS that affect the physical condition of the property. - May decrease the value or obstruct the use of property. - An encumbrance is the right one interest held by someone other than the property owner that affects title to the real estate but does not necessarily prevent a transfer of title. PHYSICAL ENCUMBRANCES: (PG 85) RESTRICTIONS / EASEMENTS/ LICENSES DEED RESTRICTIONS -private restrictions that affect the use of land -once in place they “run with the land” limiting the use of property and binding to our grantees. -CCC& R’s are private agreement that affect the land-use. -Typically imposed by a developer or subdivider EASEMENT - the right to use the land of another party for a particular purpose. - It may exist in any portion of the real estate, such as airspace above or right of way across the land. -APPURTENANT EASEMENT use of someone else’s land - Two different parcels of land owned by two different people - SERVIENT TENEMENT is the parcel over which the easement runs. - DOMINANT TENEMENT is who is actually using (dominating ) the land. EASEMENT IN GROSS (Think: BIG) A railroad right-of-way is an easement in gross, as the rights of ways of utility easements - an individual or company interest in right to use someone else’s land. -Commercial easement in gross may be assigned, conveyed, and inherited. -Personal easement in gross are usually not assignable. Generally personal easement in gross terminates on the death of an easement owner EASEMENT BY NECESSITY / necessary to enter or exit a piece of land - necessary to create, is court ordered for entering INGRESS or exiting EGRESS a piece of land. - An owner sells a parcel of land that has no access to a street or public way except over the sellers remaining land. - This is a form of easement by necessity, not so much for convenience. ``` EASEMENT BY PRESCRIPTION If the claimant has made use of another’s land for a certain period of time as defined by state law it is an easement by prescription or a prescriptive easement may be acquired. In Pennsylvania this easement runs for 21 years and then it becomes the property of the person who we used it. CANOE: CONTINUOUS ADVERSE NOTORIOUS OPEN EXCLUSIVE ``` PA LAW: And easement by prescription must be for at least 21 years, fall under “CANOE” It is awarded if the claimant meets all the requirements and provides sufficient proof in court. TACKING - Successive periods of continuous occupation by different parties combined to reach the required number of years necessary to establish a claim for prescriptive easement. LICENSE (informal) - personal privilege to enter the land of someone else for a specific purpose - differs from an easement because it can be terminated or canceled - If the right to use someone else’s property is given ORALLY OR INFORMALLY generally considered to be a LICENSE rather than a personal easement. - ends on the death of either party or the sale of the land. Examples include permission to park in the neighbors driveway and the privileges that a ticket to a theater or sporting event conveys

Answer 20

TERMINATING AN EASEMENT - need NO LONGER exists -when the owner of either the dominant over servient tenant becomes the owner of both and the properties are merged under one legal description known as “TERMINATION BY MERGER”. - RELEASE OF THE RIGHT of easement to owner of the serving at tournament - ABANDONMENT of the easement (the intention of the parties is the determining factor) - by NON USE of a prescriptive easement - ADVERSE POSSESSION by the owner of the servient tenement - DESTRUCTION of the servient tenement, (for instants the demolition of a party wall) -LAWSUIT or an action to quiet title against someone claiming an easement, by exclusive use as won a residential uses converted to commercial purposes Easements me not automatically terminate for these reasons. Certain legal steps may be required.

Answer 21

RIPARIAN RIGHTS Refers to rivers streams and similar waterway - Common-law rights given to owners of land laying along the course of a river stream or similar body of water. -Governed by laws that vary from state to state, they generally include unrestricted right to the water. - owner cannot in interrupt or alter the flow of water or contaminate it in anyway. -And owner of land that borders a non-navigable waterway, (a body of water on unsuitable for commercial boat traffic) owns the land under the water to the exact center of the waterway. - Land of adjoining commercially NAVIGABLE WATERWAYS is owned to the WATERS EDGE, with the state holding title to a submerged land. - Navigable waters are considered public highways on which the public has an easement or right to travel LITTORAL RIGHTS Closely related to riparian rights are littoral rights land borders commercially navigable lakes,seas, and oceans. - Owners with LITTORAL RIGHTS enjoy unrestricted use of available waters but own the land ADJACENT to the waters only up to the mean (average) high watermark - land below this point is owned by the government - A former owner cannot retain the right after the land is sold. DOCTRINE OF PRIOR APPROPRIATION (DEALS WITH WATER RIGHTS / OWNERSHIP OF WATER) Typically applies to states where water is scarce or they have to pay for it such as California. - Ownership and use of water often determined by a doctrine of prior appropriation. - It is the RIGHT TO USE ANY WATER with the exception of limited DOMESTIC USE - controlled by STATE rather than buy the land owner adjacent to the water.

Answer 22

-DEED IN TRUST - when a TRUSTOR conveys real estate TO A TRUSTEE for the benefit of a beneficiary. - The real estate is HELD BY THE TRUSTEE to fulfill the purpose of the trust TRUSTEE’S DEED - A deed EXECUTED BY A TRUSTEE - when a TRUSTEE conveys real estate held in the trust to anyone OTHER THAN the TRUSTOR. - The trustees deed MUST STATE that the trustee is executing the instrument in accordance with the powers and authority granted by the trust instrument. DEEDS EXECUTED PURSUANT TO COURT ORDER - Executors and administrators deeds, masters deeds, sheriffs deed, and many other types are all deeds executed pursuant to a court order - Established by state statue - used to convey title to property that is transferred by court order or by will. - must conform to the law of the STATE in which the property is located. - common characteristic is that the full consideration is usually stated in the deed because the deed is done before a court order, because the court has authorized the sale of the property for a given amount of consideration, this amount must be exactly stated in the document.

Answer 23

- Required by most states on conveyances of real estate. - Maybe paid by either the seller or the buyer or split between them. - Tax rate varies and may be imposed at the state, c county, or city level. - Usually payable when the deed is recorded. - Some states the taxpayer purchases stamps from the recorder of the county where the deed is recorded. The stamps must affix to deeds & conveyances BEFORE the document can be recorded. - Other states the tax payer pays the clerk of court or county recorder the appropriate transfer tax amount in accordance with the state and local law.

Answer 24

- Currently a state transfer tax is 1%. - Is imposed on the full consideration paid for the real estate. - State law also permits local taxing districts such as cities boroughs, townships, & school districts to impose a transfer tax. - they are local they are generally 1% of the consideration, municipalities with the home rule charter government or permitted to charge more. DEEDS THAT ARE EXEMPT FROM THE TRANSFER TAX ARE - transfers between parent and child or between siblings - deeds not made in connection with the sale such as changing joint tenants - conveyances two, from, or between governmental bodies - deeds between charitable, religious, or educational institutions comp. - deeds securing debts or releasing property as security for debt - petitions - tax deeds - deeds pursuant to merges of corporations - deeds from subsidiary to parent corporation‘s for cancellations of stock. Transfer of property by ground lease is accomplished by a lease agreement. Transfer taxes are charged on leases in EXCESS OF 30 YEARS

Answer 25

DEEDS THAT ARE EXEMPT FROM THE TRANSFER TAX - transfers between parent and child or between siblings - deeds not made in connection with the sale such as changing joint tenants - conveyances two, from, or between governmental bodies - deeds between charitable, religious, or educational institutions comp. - deeds securing debts or releasing property as security for debt - petitions - tax deeds - deeds pursuant to merges of corporations - deeds from subsidiary to parent corporation‘s for cancellations of stock. Transfer of property by ground lease is accomplished by a lease agreement. Transfer taxes are charged on leases in EXCESS OF 30 YEARS

Answer 26

APPURTENANCE (parking space, easement, water rights) Real property is often coupled with the term appurtenance. Appurtenance “run / go with the land”. The right or privilege that is associated with it, a parking space/ easements/ water rights Usually transferable to new owner. APPURTENANT EASEMENT - and easement that is attached to the ownership of one parcel and allows the owner the use of the neighbors land. - Involves two adjacent parcels of land must be by owned two different parties -if the dominant tenement is conveyed to another party the easement transfers with the title -known as “run with the land“ - ENCUMBRANCES / A claim, charge, or liability that attaches to real estate such as RESTRICTIONS, EASEMENTS & ENCROACHMENTS that affect the physical condition of the property. - May decrease the value or obstruct the use of property. - An encumbrance is the right one interest held by someone other than the property owner that affects title to the real estate but does not necessarily prevent a transfer of title.

Answer 27

ADVERSE POSSESSION - The actual, visible, hostile, notorious, exclusive and continuous possession of another’s land under a claim of title. -possession for a statutory period ay be a means of acquiring title. (law dictionary). Personal Property may also be acquired by adverse possession. Adverse possession is similar to prescription, another way to acquire title to real property by occupying it for a period of time. Prescription is not the same, however, because title acquired under it is presumed to have resulted from a lost grant, as opposed to the expiration of the statutory time limit in adverse possession.

Answer 28

ESHEAT Is intended to prevent property from being ownerless. - if no heirs or will is left, it goes back to the state. - A process by which the STATE may acquire privately owned real or personal property. - State laws provide for ownership to transfer or esheat to the state when the owner dies leaving no heirs as defined by law and no will that directs how the property is to be distributed. IN PENNSYLVANIA - both real and personal unclaimed property must be TURNED OVER TO THE STATE - However, some states ( NOT PENNSYLVANIA) real property escheats to the county where the land is located

Answer 29

TESTATE has a will INTESTATE does not have a will

Answer 30

DEVISE -The gift of real property by will is a devise DEVISEE -The person who receives the property is the devisee BEQUEST -a gift of personal property LEGACY -is a gift of money

Answer 31

NET LEASE - is often a “ground lease” (Sheetz / see ground lease) - Is commercial/industrial - the lessee pays basic rent plus all or most property charges / operating expenses - the lessor may pay SOME property charges The monthly rental is net income for the landlord after operating costs have been paid.

Answer 32

GROSS LEASE (Think: the gross amount goes to the rent/ basic rent payment) - is residential - the lessee pays the basic rent - the lessor (landlord) pays property charges such as taxes, repair costs, insurance, and the like (AKA property charges or operating expenses)

Answer 33

PERCENTAGE LEASE -commercial/industrial - lessee pays the basic rent plus percent of gross sales (may be property costs) - the lessor may pay some or all property charges -Either a gross lease or a net lease may be a percentage lease. -This type of lease is generally used for retail business leases. -The rent is based on a minimum fixed rental fee plus a percentage of the gross or net income received by the tenant doing business on the lease property. -Percentage charged is negotiable and varies depending upon the nature of the business, the location of the property, and general economic conditions.

Answer 34

GROSS LEASE NET LEASE PERCENTAGE LEASE

Answer 35

VARIABLE LEASE Different types of leases that allow for increases in fixed rental charge during the lease. 2 TYPES ARE -GRADUATED LEASE provides for specific rent increases at set future dates - an INDEX LEASE , allows rent to be increased or decreased periodically based on changes in the consumer price index or some other index. GROUND LEASE Think of in class when we were talking about Sheetz. They lease the ground and Sheetz puts up the building, Sheetz pays for everything. The lease is usually for 10–20 years. – USUALLY a ground lease is GENERALLY net leases: the leasee pays rent on the ground as well as real estate taxes, insurance premiums, and upkeep and repair costs. -unimproved land that is leased to a tenant who agrees to erect a building on it, the lease is usually called a ground lease. -usually used in commercial and industrial property development -usually involves separate ownership of the land and building -the term often runs for 50–99 years OIL & GAS LEASE -when an oil company leases land to explore for oil and gas a special lease agreement must be negotiated – If no well is drilled was in the period of stated in the lease the lease expires – If oil or gas is found the landowner usually receives a percentage of the value as a royalty. LEASE PURCHASE -is used when a tenant wants to purchase the property but is unable to do so – the tenant may not be able to obtain favorable financing or clear title, or tax consequences of a current purchase would be unfavorable, (Note: the tenant not being able to purchase the land is not necessarily always due to a fault of their own) – in this agreement, the purchase agreement is the primary consideration and the lease is a secondary – Part of the periodic rent is applied towards the purchase price of the property until it is reduced to an amount for which the tenant can obtain financing. -SALE & LEASEBACK -The owner of the property sells the property and then leases it back for an agree period and rental -a sale and leaseback are often used when EXTRA CAPITAL is needed on a construction project – original owners pull out their EQUITY to use on other projects and reduce their taxable income when they pay rent to the new owner – the new owner now has a reliable source of rental income for an extended time

Answer 36

Rescind (go back to the beginning (of a contract) - returns the parties to their original position before the contract - any money exchanged must be returned - normally a contractual remedy for a breach - a contract may also be resend it by mutual agreement of the parties.

Answer 37

– new contract in place of an original contract – it a discharges old obligations –

Answer 38

– refers to a transfer of rights or duties under a contract – generally rights and obligations may be assigned to a third-party, called an assignee, unless the contract forbids it

Answer 39

– violation of any of the terms of conditions without a legal reason – a seller who fails to deliver title to the buyer breaches the contract – the breaching or defaulting party assume certain burns, and another faulting party has certain remedies – if the seller breaches a real estate agreement of sale, a buyer may sue for specific performance unless the contract specifically states otherwise

Answer 40

-the buyer asked the court to force the seller to go through with the sale and convey the property as previously agreed – the buyer may choose to sue for damages, in which case the seller is asked to pay for any costs and hardships suffered by the buyer as a result of the sellers breach

Answer 41

- clause in real estate purchase contract that specifies the amount of money to which the seller is entitled if the buyer breaches the contract

Answer 42

– State law limits the time within which the parties to a contract may bring legal suit to enforce their rights. – In Pennsylvania, the STATUE OF LIMITATIONS is FOUR YEARS years from the date of the contract is breached. – Any rights that are not forced within this applicable time period are lost

Answer 43

PARTIAL PERFORMANCE SUBSTANTIAL PERFORMANCE – when one party has substantially performed on the contract but did not complete all the details exactly as a contract requires. - Such performance may be enough to force payment, was certain adjustments for any damages suffered by the other party. IMPOSSIBILITY OF PERFORMANCE – cannot be legally accomplished MUTUAL AGREEMENT - an agreement of both parties to cancel the contract OPERATION OF LAW -such as the voiding of a contract by a minor - a result of fraud - an expiration of the statute of limitations - because the contract was altered WITHOUT THE WRITTEN CONSENT OF ALL PARTIES CONCERNED.

Answer 44

– listing agreement and buyer agency agreement – real estate sales contracts – options agreement – escrow agreements – leases – land contracts or contract for deed - many states have specific guidelines for when and how real estate licensees may prepare contracts for their consumers – they are created by STATE REAL ESTATE OFFICIALS, court decisions, or statues – licensees may be permitted to fill in the blanks on certain approve pre-printed documents, such as sales contracts, as directed by the client. - NO SEPARATE FEE MAY BE CHARGED FOR COMPLETING THE FORMS. -The practice of law includes preparing legal documents, such as deeds and mortgages, and offering advice on legal matters: a real estate licensee who is not a licensed attorney cannot practice law.

Answer 45

The consequences of a licensee providing legal advice can result in – criminal offense – up to one year in prison & a $2500.00 fine THE STATE REAL ESTATE COMMISSION may take – disciplinary actions possibly resulting in a fine suspension or a revocation of the license – can also get sued by affected parties causing monetary awards

Answer 46

1) What to write in the blanks 2) what words and phrases should be ruled out by drawing lines through them because they don’t apply 3) what additional clauses or agreements (AKA riders or addenda) should be added. -All changes and additions are usually initialed in the margin or on the rider by both parties when the contract is signed. In PENNSYLVANIA licensees are permitted to fill in the blanks on certain pre-printed documents, such as an agreement of sale or leases, as long as they do not charge a separate fee for completing the forms.

Answer 47

Section 604 of RELRA specifically prohibited acts common violations – misrepresentation – miss handling of escrow funds – inappropriately paying commissions – miss leading advertising – Failing to preserve records relating to any real estate transaction for 3 years following consummation of the transaction – placing a for sale or for rent sign on or advertising any property without the written consent of an owner – failing to specify a definite termination date that is not subject to prior notice and any listing agreement AND MANY MORE

Answer 48

– at least 5 YEARS from the date revocation began – after the 5 YEAR period, the individual may petition to the commissions for relicensure – if the commission authorizes relicensure the individual shall comply with the prevailing, current licensing requirements before the license is issued

Answer 49

CIVIL PENALTIES Up to $1000 against any current licensee who violates the act or any person who practices real estate without being properly licensed REPORTING CRIMES & DISCIPLINARY ACTIONS -the licensee shall notify the commissioner of a conviction or pleading of guilty or nolo condensers to a felony or a misdemeanor. -Must be made within 30 days of the verdict or plea – if licensing authority in another jurisdiction takes disciplinary action, the licensee must notify the commission Pennsylvania within 30 days of that action.

Answer 50

-is for civil suits do from fraud, deceit, misrepresentation in a real estate transaction – judgment involving the sale of a campground or a campground membership sales person cannot be revoked from this fund – maximum amount payable from recovery fund $20,000 per claim $100,000 per license – if 100,000 is insufficient to settle the claims against licensee , the 100,000 must be distributed according to the same ratio as the respective claims TO COLLECT FROM A FUND -they may not be a spouse or personal representative of the spouse of the licensee – they must show that the final judgment was awarded – that all reasonable remedies have been exhausted to collect a judgment – and that the application is being made WITHIN 1 YEAR of termination of the proceedings including appeals – if the balance in the real estate recovery fund is insufficient to satisfy any claim or portion of the claim the commission must satisfy the unclaimed plus accumulated interest at a RATE OF 6% per year what’s the fund is reestablished. – Money for the fund is collected from licensees – originally established in 1980 each licensee paid $10 into the fund when the licenses renewed – if necessary the commission may access an additional fee not to exceed $10 per licensee if the fun drops to $300,000 or less, to bring the funds balance up to 500,000 – fees are paid to states treasures and are allocated exclusively for the fund – money must be invested, interest and dividends must a crew to the fund – the license of the person involved in a claim is automatically suspended as of the date payment is made from the fund – license cannot be reinstated until the licensee repays the amount of the claim plus interest at 10% per year

Answer 51

- BROKER (know various responsibilities) – Must be 21 years of age – high school graduate or equivalent – completed 240 hours / 16 credits of real estate instruction as prescribed by the commission institution required for the sales person license does not qualify for broker license - a licensed real estate sales person for at least 3 YEARS or experience / education that commissions consider equivalent – passed both portions of the written exam with in 3 years of the date of license application – submit a written application including the name and address under which the applicant will do business and recommendations attesting to the applicants reputation for honesty, trustworthiness, integrity and confidence – BROKER OF RECORD – ASSOCIATE BROKER - employed by a broker of record – may not employ other licensees or engage in real estate business in their own name or from their own place of business - an associate brokers license is required to manage a branch office on behalf of a licensed broker of record – SALES PERSON -must be 18 years of age – complete 60 hours of real estate as prescribed by the commission – passed both portions of the examination prior to being issued a license A LICENSEE CAN -sell – list - bye -lease – rent – collect THEY CAN NEGOTIATE - purchase – sale – extinct exchange – a loan on Real Estate – assist broker in managing property – perform comparative market analysis. -SUPERVISED PROPERTY MANAGEMENT – Activities must be directly supervise and controlled by the employing broker – the licensee who is the sales person or associate broker is not permitted to independently negotiate the terms of the lease or execute a lease on behalf of the lessor – QUALIFIED ASSOCIATION: Think real estate teams – CEMETARY BROKER -responsible for the business activities and maintenance of an office in the same manner as a licensed broker – 60 hours of instruction as approved by the commission -engaged for 3 YEARS or equivalent as a sales person or cemetery sales person – pass a written examination prior to licensure – CEMETERY ASSOCIATE BROKER -an individual broker who is employed by another cemetery broker or a broker – they have the same relationship with employing broker as an associate broker -CEMETERY SALESPERSON – Must be 18 years of age and submit a sworn affidavit from the employing broker or cemetery broker attesting to the applicants good reputation and that the broker will actively supervise and train the applicant – no education or examination requirement for licensure – BUILDER-OWNER SALESPERSON – rental listing referral agent – campground membership sales person –

Answer 52

INVOLUNTARY ALIENATION (could be taken by law or nature) -when land is transferred without the owner‘s consent – usually done by the law, such as condemnation in foreclosure sales satisfy debts. - could be acquired through accretion or actually lost through erosion – other acts of nature such as earthquakes, hurricanes, sinkholes, and mud slides may create or illuminate a loan and land owners holdings. 4 WAYS THAT INVOLUNTARY ALIENATION CAN TAKE PLACE - The person dies intestate; no heirs, it’s taken by the process of escheat the property is taken by the state or county – the land is needed for public use the process of taking it is eminent domain or through condemnation and payment of just compensation the property is taken by public or government agency – it’s taken by non-payment of a debt secured by real property and it could be any debt the process for much is taken is foreclosure the property is taken by a creditor – It’s taken by open, notorious, continuous, hostile, and adverse use of another’s property for prescriptive This process is known it as adverse possession it is taken by the adverse possessor.

Answer 53

FREEHOLD ESTATE - deals with OWNER INTEREST - is for an indeterminable length of time such as a lifetime or forever – a freehold estate continues for an indefinite period and maybe passed along to the heirs - are created by deed, will, or operation of law LEASEHOLD ESTATE - where a length of time IS determined - AKA “less than freehold estate” – generally considered personal property – if a tenant assumes A LOT of the landowners obligations under a lease for life or for more than 99 years

Answer 54

– Created by a written agreement between two parties (can be mutual agreement or done legally) that establishes the easement right - EASEMENT BY NECESSITY &. EASEMENT BY PERSCRIPTION - two other ways are (1) easement by NECESSITY (CREATED BY THE COURTS).... no land is landlocked, the right in ingress & egress, it is NECESSARY - & (2) easement by PRESCRIPTION use of another’s land, (in Pennsylvania it has to be at least 21) - remember CANOE continuous adverse notorious open and exclusive – without the owners permission – the creation of an easement involves two separate parties, one of whom is the owner of the land over which the easement runs - two other ways are an easement by necessity, and easement by prescription.

Answer 55

``` LEASEHOLD ESTATES: TENANCY FOR: YEARS PERIODIC (HOLDOVER) AT SUFFERANCE AT WILL ``` - an ESTATE OR TENANCY FOR YEARS A leasehold estate that continues for a definite. – maybe years, months, weeks, or even days – it always has a specific starting and ending point -NO NOTICE is required to terminate in the state for years, the lease agreement states the specific expiration date – when the lease expires, the tenants rights are extinguished. – If the lessor dies or the property is sold the tenants rights are unaffected unless the lease states otherwise – a PERIODIC ESTATE OR TENANCY - no specific expiration date (automatically rolls over) - creative initially to run for a definite term for instants month-to-month, week to week, year-to-year -continues to run in definitely until proper notice of termination is given - rent is paid at definite intervals/characterized by continuity - automatically renews under the original of agreement until one of the parties gives notice - for example a month to month tenancy is created when a tenant takes possession with no definite termination date and pays monthly rent - often used for residential leases - a HOLDOVER TENNANCY can be created when a tenant for years remains in possession, or “holds over”, after the lease expires. If no new lease agreement has been made then a holdover tenancy is created - an ESTATE OR TENANCY AT WILL THINK: at their own free will / allowing the tenant to stay for an indefinite period of time – indefinite time; possession WITH landlords consent – if the landlord or tenant dies the tenancy is done – continues until it is terminated by either party giving proper notice – no definite initial period specified – can be created by an agreement or by law – tenant has all the rights and obligations of the lessor / lessee relationship including payment of rent at regular intervals – is often viewed skeptically by courts - an ESTATE OR TENANCY AT SUFFERANCE - it tenants previously unlawful possession continued WITHOUT landlords consent – arises when a tenant who lawfully possessed real estate property continues in possession of the premises without the landlords consent after the rights expires – if a lease contains a holdover clause, the lease governs the rights of both the landlord and the tenant – if it does not contain a holdover clause then a state law governs and typically offers 3 options – 1) the landlord can except rent offered by the tenant, creating a new tenancy under conditions of the original lease, or a holdover lease if the original lease term was greater than one year, generally a new tendency is limited to one year to -2) if the landlord objects to the tenant holding over he can either he can inform the tenant of such treatment creating a month to month or periodic tenancy – 3) the landlord can treat the tenant as a trespasser and proceed with eviction and damage actions – if the landlord takes that route they must give a notice to quit requirement in the lease and state laws regarding the landlord tenant relationship TYPES OF LEASES: GROSS LEASE - residential - lessee play is the basic rent - the lessor pays property charges such as taxes, repair costs, insurance, etc. NET LEASE - commercial / industrial - lessee pays basic rent plus all or most of the property charges – the lessor may pay some of the property charges PERCENTAGE LEASE - commercial\industrial – the leasee pays basic rent plus percent of the gross sales (MAY PAY probable cost – the lessor may pay some or all of the property charges

Answer 56

- clause that follows the granting clause -this clause explains and defines the ownership to be enjoyed by the grantee – a HABENDUM clause begins with the words “to have and to hold“ – it’s provisions must agree with those stated in the granting clause – for example, if the grantor conveys a timeshare interest or an interest less than fee simple absolute, the HABENDUM clause would specify the owners rights as well as those rights are limited

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