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SCC REA 201 > The Business of Real Estate > Flashcards

The Business of Real Estate Flashcards

1
Q

Major divisions of real estate business

A
  • brokerages
  • property development
  • property management
  • property appraising
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2
Q

Business brokers

A

Brokers who sell businesses and are required to have a real estate license

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3
Q

Financing/Investment Firms

A

Any individual firm that owns and/or invests in real estate for profit

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4
Q

Mortgage brokers

A

The business of providing financing, loan processing, servicing or packaging

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5
Q

Educators

A

Teachers of real estate concepts

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6
Q

Urban planning

A

Process concerned with development/ design of land use for urban entitites

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7
Q

Government divisions

A

Entities such as EPA or Forest Services affecting real estate business

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8
Q

Escrow Services

A

Organizations that fulfill escrow instructions and handle transaction closings

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9
Q

Title companies

A

Organizations that analyze title to property and issue title insurance

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10
Q

Brokerages

A

Function to bring buyers and sellers together for real estate transactions, charging a fee called commission

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11
Q

Brokerage specializations

A
  • residential
  • business
  • commercial
  • industrial
  • farm or agricultural properties
  • property management
  • leasing
  • exchanging
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12
Q

Real Estate Brokerages

A
  • a company also referred to as the Entity and the Employing Broker
  • must obtain entity license from department of real estate
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13
Q

Error and Omissions

A

Insurance that covers the company and agents form lawsuits for any error or omission that took place in a transaction

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14
Q

Liability Insurance

A

General insurance policy that would cover customer injuries, customer property damage

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15
Q

Umbrella policy

A

Extended coverage where primary liability policy limits end

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16
Q

Real estate brokerage can be organized as one of these three types of business entities …

A
  • Partnership
  • Corporation
  • Limited Liability Company (LLC)
17
Q

Partnership

A

Partnership with a managing general partner who is licensed as the designated broker

18
Q

Corporation

A

A lawfully organized corporation that is registered with the Arizona Corporation Commission and that has an officer licensed as the designated broker

19
Q

Limited Liability Company

A

A lawfully organized liability company that has a member or manager licensed as the designated broker

20
Q

Broker Licenses

A
  • Designated broker
  • Managing broker
  • Associate broker
21
Q

Designated broker

A

Licensed as a broker and designated to act on behalf of employing brokerage (entity)

22
Q

Managing broker

A

Appointed by designated broker to assist with daily functions

23
Q

Associate broker

A

Supervised by designated broker, can be hired as designated broker

24
Q

Subdividers

A

Individual or entity that takes raw land and does planning for its best use

25
Q

Land developers

A

Improve lots by adding buildings, employ architects and builders

26
Q

Property Managment

A

The special management for income properties such as apartment complexes, condominiums, and commercial buildings

27
Q

Appraising

A

Appraisers can work for county assessors, banks, or government

28
Q

Independent Contractor

A

Must be licensed must receive all income as commissions and must posses written contract outlining status

29
Q

Commission

A

All commissions negotiated, no industry standard. Typically a percentage of the sales price, but could be a flat fee

30
Q

Commission sharing brokerage

A

Agent is paid a percentage of total commission

31
Q

100 Percent brokerage

A

A salesperson earns 100% of the commission minus a flat fee owed to the broker. Also required to pay a monthly office fee, and will have to pay business expenses

SCC REA 201 (75 decks)

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