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RE Practice Flashcards

1
Q

A Remainderman

A

All interests held by the Life Tenant end when the designated person dies.
o This will be either the Remainderman who is the person designated to receive the property, or the Reversionary Holder who is the original owner and the Grantor of the Life Estate.

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2
Q

Ownership in Severalty

A

Ownership in Severalty is when a person owns property solely or there is no one else on Title. The Sole Owner can be an individual, or an entity such as a Corporation or a Trust.

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3
Q

Community Property

A

Community Property is a concept derived from Spanish Law and instilled in California Law as a result of the Treaty of Guadalupe Hidalgo. The State of California, along with several other states, is a Community Property state. It is a form of ownership applying to both Real and Personal Property pertaining to married couples.
o If one spouse owns property as Sole and Separate property, the non-owning spouse will need to sign a Quit Claim Deed at the time of purchase or borrowing against the property.
o Signing a Quit Claim Deed relinquishes their right and claim to the property.

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4
Q

Business Ownership of Property

A

Business Ownership of Property can take many forms. Businesses may purchase, sell, use, or lease property in the name of the business entity. The type of business structure will determine the extent of ownership and the capabilities allowed by law.

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5
Q

Condo ownership includes the ownership of

A

Condo ownership includes the ownership of the green areas or common grounds

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6
Q

PUDs include - Planned Unit Development

A

PUDs include the ownership of the individual lot that the unit is on.

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7
Q

A Co-op is distinguished by

A

A Co-op is distinguished by ownership of stock in the corporation

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8
Q

CC&R

A

CC&Rs are Covenants, Conditions, and Restrictions which lay out the rules and regulations for the project as established by the developer as part of creating a Common Interest Ownership project

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9
Q

Condo Property taxes

A

Property taxes are Ad Valorem, and paid for by the individual unit owners according to what they paid for their individual unit. Property taxes in California are Ad Valorem, which means “according to value”

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10
Q

***An Encumbrance is

A

An Encumbrance is the interest or right to use anothers property (ie easement)!!! ENCUMBRANCE. Anything which affects or limits the fee simple title to or value of property, e.g., mortgages or easements.

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11
Q

An Abstract of Judgment is

A

Abstract of Judgment is awarded to the creditor once they receive the final judgment. The Abstract of Judgment can be filed in any or all counties in California.

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12
Q

Writ of Execution

A

A Writ of Execution may be requested from the court by the lien holder providing the right to have any non-exempt properties sold to pay the Judgment debt.

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13
Q

Filing a Certificate of Completion with the County Recorders Office gives

A

Filing anything with the County Recorders Office provides Constructive Notice.

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14
Q

***An Appurtenant Easement

A

Easement Appurtenant is an Easement that “runs with the land”. The expression “runs with the land” means that the Easement Appurtenant belongs with the land and will transfer to a new property owner and not go away with the change of ownership of the property.

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15
Q

The General Plan is

A

The General Plan is also called the Master Plan that is created by a local planning commission for the development of a community.

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16
Q

Estoppel

A

Estoppel is a legal term meaning terminating or preventing future actions

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17
Q

Under Police Power there is

A

Under Police Power there is no compensation because there is no taking of land.

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18
Q

***ESCHEAT.

A

ESCHEAT. The reverting of property to the State when heirs capable of inheriting are lacking.

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19
Q

***A change in zoning for an entire area or neighborhood is called:

A

An Amendment to zoning affects an entire neighborhood or area.

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20
Q

Conditional Use Permit

A

A Conditional Use Permit is a type of a zoning Variance that is temporary. It applies to only one property, not a neighborhood.

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21
Q

The County Board of Supervisors:

A

The County Board of Supervisors set the tax rate

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22
Q

Title is a term that is commonly used synonymously with ownership.

A

k

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23
Q

Quiet Title Action is used to:

A

Quiet Title Action is used to Clear a Cloud on Title.

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24
Q

An Execution Sale is:

A

An Execution Sale is awarded by the courts with a Writ of Execution to the Judgment Line holder and the successful bidder at the sale receives a Sheriffs Deed.

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25
Q

Intestate

A

When a person dies with no Will they are said to have died Intestate.

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26
Q

Holographic Wills

A

Holographic Wills are completely handwritten by the Testator and cannot be typewritten. The Holographic Will must be signed and dated by the Testator, but it does not need to be witnessed. If the Will has typed sections included or is not all in the Devisor’s handwriting, it is no longer a Holographic Will and will considered a Witnessed Will and require witnesses.

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27
Q

Accession can be by means of

A

Accession is the increase of property owned by either man-made or natural causes. These additions add property to the owner’s Title by improvements, accretion, or reliction.

Accession or the gaining of land can be both through improvements and by accretion or the action of water.

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28
Q

Adverse Possession is accomplished by:

A

To gain property through Adverse Possession, one must meet five specific conditions.

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29
Q

An Agency Agreement requires a Fiduciary Relationship

A

An Agency Agreement requires a Fiduciary Relationship

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30
Q

n Agent acting as a Dual Agent in a transaction must be careful not to disclose pertinent information. As in any Real Estate transaction, the price, terms and motivation must never be disclosed to the other party without written permission from the party concerned.

A

n Agent acting as a Dual Agent in a transaction must be careful not to disclose pertinent information. As in any Real Estate transaction, the price, terms and motivation must never be disclosed to the other party without written permission from the party concerned.

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31
Q

An Agency Relationship is

A

An Agency Relationship is an Employment Relationship because the Principal is hiring the Agent to perform a job.
The type of the Real Estate transaction the Agent has been hire to perform is essentially an Employment Relationship. As stated earlier, the Principal hires the Real Estate Agent to perform a job or duty. This applies to both a Special Agency and a General Agency.

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32
Q

An Agency Agreement can be formed by

A

An Agency Agreement can be formed by all of the choices; Express Agreement, Ratification, or Estoppel.

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33
Q

Easton vs. Strassburger resulted in the opinion

A

Easton vs Strassburger suit established the legal opinion that the Agent is responsible for not only what he does know, but also what he should know.

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34
Q

For a contract to be considered Valid, it must have

A

Essential Elements of a Contract must be present in Real Estate Contracts in California for a contract to be considered Valid. The following are the Essential Elements required:
Consent, Capacity, Consideration, Lawful Objective

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35
Q

An executory contract is one that has

A

An Executory contract is one that has not been completed. Executed has been completed.

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36
Q

Addendum to a contract is an addition to the existing contract becoming a part of the original contract.

Amendment to a contract is a change to a contract that is not a part of the original contract. An Amendment occurs after the fact.

A

Addendum to a contract is an addition to the existing contract becoming a part of the original contract.

Amendment to a contract is a change to a contract that is not a part of the original contract. An Amendment occurs after the fact.

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37
Q

A Voidable contract

A

A Voidable contract has been violated by fraud or breach.

38
Q

A Purchase Contract is also known as

A

Offer and Offer to Purchase, or the Purchase Contract is generic terms for the form that is used by Real Estate Agents to determine the terms of the purchase between Buyer and Seller. The contract is frequently referred to by Real Estate Agents as a Deposit Receipt.

39
Q

Who picks the escrow company?

A

Under RESPA the Buyer is the only party to a Purchaser Transaction with the right to select the Escrow and Title Company. If the Seller selects, they may be liable for the Buyers expense and punitive damages in the amount of 3x the Escrow and title costs.

40
Q

1031

A

A 1031 Exchange cannot be used for owner-occupied property. This is for investment properties only and must be like properties.
A 1031 Exchange is for the purpose of deferring Capital gains Taxes on investment property only

41
Q

Alquist-Priolo refers to

A

Alquist-Priolo Earthquake Fault Zoning Act (enacted in 1972) provides for the mapping of known active earthquake faults and the identification of a 1,000 foot wide zone with the fault zone in the middle. The fault zone is considered to be 1⁄4 mile either side of the fault. Local Planning Commissions are required to provide this information and adhere to building codes specified for these areas.

42
Q

Megan’s law

A

sex offenders

43
Q

A written Lease must be signed by

A

The Landlord must sign the written Lease; however the Tenant does not need to sign because they accept the terms of the Lease by taking possession of the property

44
Q

Security deposit on a residential rental is never

A

Security deposit on a residential rental is never non-refundable in California.

45
Q

The Landlord has the right to enter a rented unit for emergencies, to make repairs or let workers in, and must give adequate notice which is considered to be 24 hours notice.

A

The Landlord has the right to enter a rented unit for emergencies, to make repairs or let workers in, and must give adequate notice which is considered to be 24 hours notice.

46
Q

A constructive Notice of Eviction is

A

Constructive Eviction may be brought by the Tenant against the Landlord based on the following actions by the Landlord:
o Interference with the Tenant’s use of the property.
o Altering the property from the condition at the time of Leasing
making it less than usable or desirable by the Tenant.
o Threats of Eviction.
o Leasing the property to another party.
o Failure to Make Necessary Repairs

47
Q

Discriminatory acts in housing are illegal under the Unruh Act Civil Rights Act, the California Civil Rights Act of 2006, and the Rumford Act.

A

Discriminatory acts in housing are illegal under the Unruh Act Civil Rights Act, the California Civil Rights Act of 2006, and the Rumford Act.

48
Q

A residential rental dwelling with 16 units or more must have

A

Must have a Resident Manager.

49
Q

Escrow is licensed by the Department of Corporations.

A

Escrow is licensed by the Department of Corporations.

50
Q

Seller’s Responsibilities

A

The Seller is responsible for Executing the Deed to transfer the property, maintaining the property in the condition when Offer was accepted, and providing CC&Rs or any other pertinent documentation.

51
Q

The HUD1

A

Federal HUD1is a detailed disclosure of Estimated Closing Costs that must be provided to the parties to the transaction. At the Close of Escrow the Final HUD1 will provide the final accounting of all funds dispersed per the terms of the contract including the commissions paid the Real Estate Agents and Mortgage Brokers.

52
Q

An instrument used as security in Real Property is a:

A

A Mortgage and a Trust Deed are both instruments that are used as security on Real Property when lending money.

53
Q

A Life Cap indicates

A

Life Cap indicates the maximum amount a rate can adjust for the life of the loan.

54
Q

Balloon Loan***

A

Balloon Loan is defined as a loan that will receive a payment in excess of 2x the minimum payment due in any payment period. Balloon loans are loans that are not amortized over for the actual term of the loan. A Balloon Mortgage is a loan that has the payments based on a term that is longer that the actual term of the loan.

55
Q

Mortgage Insurance

A

Mortgage Insurance (MI) or Primary Mortgage Insurance (PMI) is insurance that insures the loan if the Borrower defaults. MI is used by Lenders as a way to protect their investment when lending. Mortgage Insurance in required on loans that are greater than 80% of the value of the property or 80% loan-to-value (LTV).

56
Q

The type of Deed that is provided to the successful bidder at a Foreclosure Sale is:

A

Sheriff’s Deed is issued to the successful bidder from the Foreclosure Sale if the Mortgagor/Borrower does not redeem the property within the Redemption time frames. At that point the original Mortgagor surrenders possession of the property.

57
Q

Value is?

A

Value is what a thing is worth

58
Q

Four Essential Elements of Value

A 
The Essential Elements of value are 
Demand, 
Utility, 
Scarcity, 
and Transferability
59
Q

Highest and Best Use

A

Highest and Best Use is the starting point for an Appraisal. This term refers to the best use for a particular piece of property that will generate the highest value. The highest and best use is not necessarily the current use of the property.

60
Q

A method of determining cost is:

A

A method of determining cost is Quantity Survey, Unit Cost in Place, Square Footage, Cubic Footage, and Index Method.

61
Q

Five Methods of Determining Cost

A

o Quantity Survey is the most accurate method of determining cost of replacing a building. The costs of the materials and labor are determined using a book that provides a breakdown of the materials and often costs to build various styles of houses. One of the most commonly used books is the Marshall and Swift Manual.

o Unit Cost-in-Place is the second most accurate method which establishes the costs to rebuild by adding the various units once installed by each of the various contractors.

o Square Footage is a very common and quick method of determining value based on the construction cost per square foot of the completed building. The formula for Square Footage is:
Length x Width= Square Footage

o Cubic Footage is similar to the square foot method and is commonly used for large industrial buildings such as factories or warehouses where the value is not based on just the length and width, but also the height. The formula for Cubic Footage is:
Length x Width x Height = Cubic Footage

o Index Method is not a very accurate method of determining cost of construction, but may work well for properties that are not very old. The Appraiser can determine the cost of the subject when it was built then multiply the total cost by the percentage of change in the cost of building from the time of construction to the current market whether it is higher or lower.

62
Q

Income Capitalization is used to

A

Income Capitalization is used to determine the value of income producing properties. An Appraiser will provide the usual Sale comps and then also include comps that are Rental Properties.

63
Q

IRV

A

Income, rate, and value

IRV is a formula used to calculate Capitalization using the Income, Rate, and Value based on an Algebraic formula.

64
Q

Real Estate Law is found in:

A

Real Estate Law is found in and is a part of the California Business and Professions Code

65
Q

The CalBRE is managed by the:

A

The California Bureau of Real Estate is managed by the Real Estate Commissioner.

66
Q

The Real Estate Education and Research Fund:

A

The Real Estate Education and Research Fund comes from 20% of License Fees collected, provides a Relief Fund for uncollectible Judgments, and provides funds research projects for the CalBRE.

67
Q

A Real Estate Salesperson Licensee may work independently of a Broker:

A

A Real Estate Salesperson’s Licensee may not work independently.

68
Q

PRLS requires a Real Estate Brokers License or:

A

Prepaid Rental Listing Service (PRLS) License is a separate license that is provided by the Bureau of Real Estate. The PRLS License is issued for a two-year period and is renewable every two years.

69
Q

Business Opportunity ?????Brokerage is the sale of

A

Business Opportunity Brokerage is the sale of a business including the goodwill.

70
Q

The Civil Rights Act was enacted in

A

1866

71
Q

Under the Fair Employment and Housing Act what is protected?

A 
Race Color Religion Sex
Gender Identity
Sexual Orientation
Marital Status
National Origin
Ancestry
Disability- either Physical or Mental Medical Condition
Familial Status Source of Income
72
Q

Redlining is the practice of

A

Redlining is the practice of denying loans on properties in certain neighborhoods.

73
Q

The Subdivision Land Law is found in

A

Subdivision Land Law is found in the Business and Professions Code. The Subdivision Land Law is administered by the Bureau of Real Estate under the Real Estate Commissioner. The purpose is to protect consumers from misrepresentation, fraud, and deceit in the marketing of the properties for sale.

74
Q

A Reservation is

A

A Reservation is an agreement to purchase a lot in the future. Reservations may be taken once they have received the Preliminary Public Report. A Reservation is an agreement to purchase a lot in the future if the reports are acceptable to the Buyer.

75
Q

The EIR is

A

The EIR is the Environmental Impact Report.

76
Q

California State Energy Conservation and Development Commission has established a rating program that includes

A

California State Energy Resources Conservation and Development Commission has created a statewide home energy rating program establishing guidelines for builders and homeowners insulating residential properties. The Seller or their Agent must provide a booklet created by this Commission to any Buyers of 1- to 4- unit residential property. Terms that have been established in conjunction with insulation and heating and air conditioning ratings are as follows:
o R-Value/Resistance-Value is the measurement used to determine the amount of effectiveness of the insulation. “R” meaning the amount of resistance the insulation will give to outside temperatures and influences including wind.
o EER/Energy Efficiency Rating is used in reference to the efficiency of heating and air conditioning units.
o HVAC/Heating, Ventilation, and Air Conditioning is used in reference to the efficiency of heating and air conditioning units.
o Btu/British Thermal Unit is used in reference to the efficiency of heating units.
o SEER/Seasonal Energy Efficiency is used in reference to the efficiency of air conditioning units.

77
Q

Flashing?

A

Flashing is a metal piece attached to the roof at joints or changes in the elevation to prevent leakage. An example of this would be at the joint of the chimney and the roof.

78
Q

REVERSIONARY INTEREST

A

The interest which a person has in lands or other property, upon the termination of the preceding estate; a future interest.

79
Q

Easements last?

A

Any length of time

80
Q

RATIFICATION.

A

RATIFICATION. The adoption or approval of an act performed on behalf of a person without previous authorization, such as the approval by a principal of previously unauthorized acts of an agent, after the acts have been performed.

81
Q

Third parties are owed care by the listing agent

A

Third parties are owed care by the listing agent

82
Q

OSTENSIBLE.

OSTENSIBLE AUTHORITY.

A

OSTENSIBLE. That which is apparent or that which seems to be.

OSTENSIBLE AUTHORITY. That authority which a third person reasonably
believes an agent possesses because of the acts or omissions of the principal.

83
Q

TORT.

A

TORT. Any wrongful act (not involving a breach of contract) for which a civil section will lie for the person wronged.

84
Q

Math- Total sales price before commission is removed. (95k left after a 5% commission)

A

95k / 95% = 100k

100k * 5% = 5k

85
Q

Connelly Grisham

A

Agents need to provide both oral and written disclosures.

86
Q

Cap rate

A

Cap rate = NOI / Valuse

87
Q

Functional Obsolescence

A

Curable or incurable (features of the property)

88
Q

Accrued Depreciation

A

Curable or incurable

89
Q

SINKING FUND.

A

SINKING FUND. Fund set aside from the income from property which, with accrued interest, will eventually pay for replacement of the improvements.

90
Q

Foreclosure time on a deed of trust??

A

115 Days

91
Q

Truth in Lending Act?

A

= TILA, TIL, Reg Z

92
Q

TRID

A

TILA/RESPA Integrated disclosure rules.

Respa = Real Estate Settlement and Procedures Act

Disclosure to client.

RE Practice (1 decks)

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