California Real Estate Practices

Auto dialer

(automatic telephone dialing system) refers to equipment that can generate and dial telephone or cell phone numbers randomly or sequentially. When using an auto dialer, follow these simple rules. First, the auto dialer can place calls only between 8:00 am and 9:00 pm. Secondly, if a sales associate or broker uses an auto dialer, the call must connect to a live sales associate within 2 seconds after the recorded greeting has finished. All real estate licensees are subject to the legislation. If a telephone number is on the national Do Not Call Registry (DNC) list, you may not make an unsolicited telephone call to that number. The fines for violations range from $500 up to $11,000.

Residential Listing Agreement—Agency

(formerly named Exclusive Agency Listing Agreement) is an exclusive contract that obligates the seller to pay the listing broker a commission if any broker sells the property. However, the seller has the right to sell the property without a broker and pay no commission.

Residential Listing Agreement—Exclusive

(formerly named Exclusive Authorization and Right to Sell Agreement) is an exclusive contract that obligates the seller to pay the listing broker a commission if the property is sold within the time limit by the listing broker, any other broker, or even by the owner. If the broker brings the seller a mirror offer, or an offer that matches all terms in the listing exactly, the seller does not have to accept the offer. However, under the terms of the listing, the seller must pay the broker a commission

Residential Listing Agreement—Open

(formerly named Non-Exclusive Open Agency Residential Listing Agreement) is a listing agreement that gives any number of brokers the right to sell a property. It is not exclusive and may be given to any number of agents at the same time. The first broker to obtain a buyer who meets the terms of the listing, and whose offer is accepted by the seller, earns the commission. That agent is known as the procuring cause of the sale. Procuring cause refers to a broker who produces a buyer ready, willing, and able to purchase the property for the price and on the terms specified by the seller, regardless of whether the sale is completed. Unlike an exclusive listing agreement, an open listing does not require a specific termination date. The owner may sell the property without an agent—owing no commission.

Interstitial ads

(interstitial means in between) are actually pages that appear between web pages that the user requests. Because interstitials load in the background, they are a preferred way of delivering ads that contain large graphics, streaming media, or applets.

Hopper window

(or eyebrow) is hinged at the bottom and opens into the room.

Mandatory (Listing Agent to provide):

1. AD: Disclosure of Real Estate Agency Relationships 2. RLA: Residential Listing Agreement - Exclusive RLAA: Residential Listing Agreement - Agency RLAN: Residential Listing Agreement - Open 3. SA: Seller's Advisory If Applicable: 4. SELM/SELI: Seller Instruction to Exclude Listing from MLS and/or Seller Instruction to Exclude Listing From Internet 5. Any permits or invoices that the seller provides

Disclosures Required of a Seller and/or Real Estate Agent

1. Disclosures Upon Transfer of Real Property a. Real Estate Transfer Disclosure Statement b. Local Option Real Estate Transfer Disclosure Statement c. Natural Hazards Disclosure d. Mello-Roos Bonds and Taxes e. Ordnance Location f. Window Security Bars 2. Earthquake Guides 3. Water Heater and Smoke Detector Statement of Compliance 4. Disclosure Regarding Lead-Based Paint Hazards 5. California's Environmental Hazards Pamphlet 6. Delivery of Structural Pest Control Inspection and Certification Reports 7. Energy Conservation Retrofit and Thermal Insulation Disclosures 8. Foreign Investment in Real Property Tax Act 9. Notice and Disclosure to Buyer of State Tax Withholding of Disposition of California Real Property 10. Furnishing Controlling Documents and a Financial Statement 11. Notice Regarding the Advisability of Title Insurance 12. Data Base - Locations of Registered Sex Offenders

Subagent

A broker delegated by the listing agent (if authorized by the seller) who represents the seller in finding a buyer for the listed property.

Buyer's agent

A broker employed by the buyer to locate a certain kind of real property. This broker represents the buyer.

Listing agent

A broker who obtains a listing from a seller to act as an agent for compensation. A listing is a contract between an owner of real property and an agent who is authorized to obtain a buyer.

Dual agent

A broker who represents both the seller and the buyer in the same transaction. This situation frequently occurs when two sales associates working for the same broker have the listing and selling side of the transaction. *Divided agency is when the agent acts concurrently for both the buyer and seller in a transaction without the knowledge and consent of both parties.

"Subject To"

A buyer may also purchase a property "subject to" the existing loan. A "subject to" clause allows a buyer to take over a loan, making the payments without the knowledge or approval of the lender. The original borrower remains responsible for the loan, even though the buyer takes title and makes the payments. In this case, the property remains the security for the loan. In the case of default, the property is sold and the proceeds go to the lender, with no recourse to the original buyer other than the foreclosure going against the borrower's credit. When a buyer takes a property "subject to" the existing loan, the underlying lender may not always be informed. The buyer simply starts making the payments and the seller hopes he or she is diligent and does not default. The occurrence of "subject to" sales is relative to economic and market conditions. In a seller's real estate market, in which more buyers than sellers exist, a homeowner does not need to sell "subject to" his or her loan.

Comparative market analysis (CMA)

A comparative market analysis (CMA) by a real estate professional is not much different from the inventory of sold properties the homeowner accumulates. The CMA is a comparison analysis that real estate brokers use while working with a seller to determine an appropriate listing price for the seller's house. You will present the CMA during your listing presentation to establish the home value with the prospective sellers. The CMA lays the foundation for setting a realistic listing price for the property.

Conventional Loans

A conventional loan is any loan made by lenders without any governmental guarantees. The basic protection for a lender making conventional loans is the borrower's equity in the property. A low down payment will mean greater risk for the lender and a higher interest charged to the borrower. Conventional loans may be conforming or non-conforming.

Property marketing plan

A detailed schedule of everything done to market a property. A property marketing plan is a roadmap leading to the sale of a particular property. The plan should be tailored to your specific skills, personal qualities, and strengths.

Property marketing plan

A detailed schedule that shows them everything you will do to market their property. You may follow the same timeline and activities in your property marketing plan for almost all of your listings.

How to Calculate the Documentary Transfer Tax

A documentary transfer tax is charged to the owner of the property whenever real property transfers to another person. The county recorder places stamps (doc stamps) on the recorded grant deed to indicate the amount of the documentary transfer tax paid. In most cases, it is based on $.55 per $500 of purchase price, or $1.10 per $1,000 of purchase price. The money goes to local government, either city or county. The tax assessment is based upon the full price of the property at the rate specified above if the sale is all cash, or if a new loan is involved, where the sellers get all cash. The tax is levied only on the equity transferred (or consideration) if the buyers assume an existing loan. When the deed records or when escrow closes, the responsible party then pays the documentary transfer tax. Example: If the buyers purchased a home for $300,000 assuming an existing loan of $200,000, the tax would be based on the $100,000 the buyers paid as a down payment, or the new money put into the transaction. $100,000 divided by $1,000 equals 100; therefore, 100 times $1.10 equals $110.00 for the tax.

Fixed-Rate Fully Amortized Note

A fixed-rate fully amortized note is a loan with an interest rate that is fixed and payments that are level for the life of the loan. This note is common with institutional lenders. It is characterized by regular, periodic payments of fixed amounts, to include both interest and principal, which pay off the debt completely by the end of the term.

Geographic Markets

A good example of a geographic target market is the traditional farm area that brokers have promoted for their agents for decades. A farm area is a geographic area where a salesperson specializes.

Section 245(a) Graduated Payment Mortgage

A graduated payment mortgage (GPM) has a monthly payment that starts out at the lowest level and increases at a specific rate. Payments for the first five years are low, and cover only part of the interest due, with the unpaid amount added to the principal balance. After that time, the loan is recalculated, with the new payments staying the same from that point on. In this loan, the interest rate is not adjustable and does not change during the term of the loan. What actually changes is the amount of the monthly mortgage payment. A GPM is offered by the FHA to borrowers who might have trouble qualifying for regular loan payments, but who expect their income to increase. This loan is for the buyer who expects to be earning more after a few years and can make a higher payment at that time.

Home Equity Line of Credit

A home equity line of credit (HELOC) is a type of junior loan that taps into a property owner's equity and creates a revolving credit line. With a HELOC, the borrower takes money, as it is needed, up to the credit limit. It has a low starting interest rate with a variable monthly rate based on outstanding balance. More and more lenders are offering home equity lines of credit. By using the equity in their home, borrowers may qualify for a sizable amount of credit, available for use when and how they please, at a relatively low interest rate. Furthermore, under the California tax law—depending on the borrowers' specific situation—they may be allowed to deduct the interest because the debt is secured by their home. A home equity line is a form of revolving credit in which a borrower's home serves as collateral. Because the home is likely to be a borrower's largest asset, many homeowners use their credit lines only for major items such as education, home improvements, or medical bills.

Takeover ad

A large ad that appears when users first go to a site. The same message is reiterated throughout the site in the form of banners, sidebars, or buttons. The approach works very well for branding because the brand is visible to viewers throughout the visit to the site. Click-through rates are high.

Items Required in a Commercial Email Message

A legitimate return email and a physical postal address A clear and conspicuous notice of the recipient's opportunity to opt-out or decline to receive any future messages Opt out mechanism active for at least 30 days after the transmission of the message Clear and conspicuous notice that the message is an advertisement or solicitation

Junior Loans

A lender uses strict standards about the amount of equity required in a property before loaning money, and particularly for a junior loan. The reason is simple. All lenders want is to get their money back in a timely manner, along with the calculated return on the investment. Care must be taken, in case of a decrease in the value of the subject property, to make sure there is enough of a margin between the total amount owed and the value of the property. If the property is sold at a foreclosure sale, the lender will be assured of getting the money back. By only loaning up to 75%-90% of the property value, the lender leaves some room for loss. Typical junior loans include home equity loans, home equity lines of credit, and seller financing.

Net listing

A listing agreement in which the commission is not definite. Instead, the broker receives all the money from the sale of the property that is in excess of the selling price set by the seller. The broker must disclose the selling price to both buyer and seller within 30 days after closing the transaction.

Half-timbering

A method of construction in which the wooden frame and principal beams of a structure are exposed, and the spaces between are filled with stucco, brick, or stone. This is found in Tudor, Craftsman, and Queen Anne styles.

Stucco

A mixture of cement, sand, and lime which is applied over a frame construction. It is found in buildings with Spanish or Mediterranean influences, as well as Ranch, Prairie, Art Deco, Art Moderne, and International houses.

Multiple Listing Service (MLS)

A networking system or cooperative listing service conducted by a group of brokers, usually members of a real estate association. Listings are submitted by the listing broker to a central bureau where they are made available by computer or printout to the members. Any MLS member may view the listings and obtain offers from buyers for these properties even if he or she is not the listing broker. A listing should be submitted to the MLS within 48 hours after the listing agreement is signed. However, the broker does not have to submit this listing to the MLS if the seller instructs the broker to withhold the listing. Instead, the broker would submit a form entitled "Seller Instruction to Exclude Listing from the Multiple Listing Service" signed by the seller(s).

Advertising campaign

A plan with a common theme describing the mode and frequency through which someone communicates a marketing concept. The advertising campaign should be intensive, evenly paced, and scheduled to continue until the goals of the campaign are met.

Errors and omissions insurance (E&O)

A policy that covers various claims for errors, mistakes, neglect, or carelessness in the normal business activities of a real estate brokerage.

Buyer's profile

A prepared list of questions used to determine the buyer's motivation and how much may be spent on a home. This questionnaire can be e-mailed to the buyer prior to meeting, or it can be completed at the initial interview.

Expired listing

A property listing that did not sell during the specified period with the listing broker. Simply run an MLS report at the beginning of each week and pick out the listings that will expire the next week.

Section 203(k)

A purchase rehabilitation loan (purchase rehab) is a great option for buyers who want to improve their property immediately upon purchase. This mortgage loan provides the funds to purchase the home and the funds to complete the improvement project all in one loan, one application, one set of fees, one closing, and one convenient monthly payment.

Prorates and Allocates Costs

A real estate transaction closes by prorating any expenses between the buyers and the sellers. This ensures that they are responsible for their share of expenses such as taxes, homeowner's dues, rental income, or fire insurance on the property during the tenure of his or her ownership. The escrow holder prorates insurance, taxes, rents, etc. and prepares a final statement for each party indicating the amount to be disbursed for services and any other amounts necessary to close escrow. Property Taxes. Homeowners usually pay annual property taxes in December and April. The escrow company will prorate the taxes for the closing date to ensure that neither the buyers nor the sellers overpay.

Security instrument

A recorded legal document given by the borrower to the lender, which pledges the title of the property as insurance to the lender for the full payment of the loan. After signing the promissory note, the borrower is required to execute (sign) a trust deed, which is the security guaranteeing loan repayment. The borrower (trustor) has possession of the property, but transfers the naked legal title to a third party (trustee). The lender holds the original promissory note and the trust deed until the loan is repaid. Once the loan has been repaid, title to the property is returned to the borrower using a deed of reconveyance.

Property profile

A report about a specific piece of property. It should include a short legal description and property characteristics (lot size, year built, square footage, number of bedrooms and bathrooms). It also includes the most recent grant deeds, any open deeds of trust, an Assessor's Parcel Number (APN), map, current taxes, and the assessed value.

6. Statutory Disclosures (Including Lead-Based Paint Hazard Disclosures) and Cancellation Rights

A seller is required to give a buyer several disclosures about the property and surrounding area, which might affect the buyer's decision to buy the property. A. Statutory Disclosures (1) Statutory disclosures are those that are required by statute or law. This subparagraph summarizes the seller's statutory disclosure requirements to deliver to a buyer two mandated forms: a Transfer Disclosure Statement and a Natural Hazards Disclosure. (2) The buyer must return the signed statutory and lead disclosures to the seller within the time indicated in Paragraph 14. (3) The seller must give the buyer an amended written disclosure if the seller becomes aware of any adverse material condition before the close of escrow that the buyer did not know about. (4) This subparagraph describes the buyer's cancellation rights if the disclosures are delivered after signing the offer. (5) Neither buyer nor seller can waive their rights to receive these statutorily required disclosures. B. Natural and Environmental Hazards The seller must provide the buyer with the natural hazard disclosures specified in Paragraph 6 within the time specified in Paragraph 14. The form is required to make six natural hazard zone disclosures: Geologic, Earthquake, and Seismic Hazard Zones Disclosure, Special Flood Hazard Areas, Inundation Zone, State (Fire) Responsibility Areas (SRA), Very High Fire Severity Zone, and Earthquake Safety. Note: The seller and broker must disclose known deficiencies in structure and earthquake hazards on all properties. The Environmental Hazard Booklet discusses common hazards. C. Withholding Taxes The seller must deliver to the buyer an affidavit that complies with the Foreign Investment in Real Property Tax Act and California tax withholding law by the date specified in paragraph 14A. D. Megan's Law Database Disclosure A seller is required by statute to inform a buyer that information is available from law enforcement officials regarding the location of registered sexual offenders. E. Notice Regarding Gas and Hazardous Liquid Transmission Pipelines Paragraph E provides details on how to obtain information regarding the general location of gas and hazardous liquid transmission pipelines. A primary resource is the National Pipeline Mapping System (NPMS), which is maintained by the United States Department of Transportation.

Oriel window

A smaller bay window on an upper story, and is supported by decorative brackets.

Double-hung windows

A traditional style found in all Colonial style houses. Both top and bottom parts move up and down.

Impound account

A trust account set up for funds that are set aside for future, recurring costs relating to a property such as property taxes and insurance.

Split-Level Ranch or Raised Ranch

A variation of the Ranch style. Instead of just one level floor plan, split-levels usually have three levels at varying heights. The mid-level entry has stairs leading to the other two levels. The upper level is used for sleeping areas; the mid-level has the living room, dining room, and kitchen, while the lower level has the family room, hobby or game rooms, laundry area, and the garage. These houses are asymmetrical, with a rectangular, L-shaped, or U-shaped design. The low-pitched roof may be hipped or gabled. Any siding may be used, but the most common is stucco or wood siding with brick or rock trim. A variety of window types are used, including single-hung, picture, and sliding glass doors that lead to patios. Some houses have decorative shutters. Newer houses may have features from almost any other architectural style.

Preapproval letter

A written commitment from a lender to loan a certain amount based on a written application by the buyer, while prequalification is based on verbal information supplied by the buyer. The mortgage broker, lender, or loan officer will provide a written letter, stating the mortgage amount the buyer has been approved for and the terms of the loan. This letter will give buyers an advantage when submitting an offer. Sellers are more inclined to accept an offer that involves preapproved buyers who can actually obtain the financing necessary to complete the transaction.

Listing agreement

A written contract by which a principal, or seller, employs a broker to sell real estate. When the seller signs a listing agreement, he or she is promising payment for service by the listing broker and the broker promises to use due diligence in finding a buyer. A listing agreement gives the broker the right to be paid only after doing the job or, at the least, producing results. It is an employment contract between the seller and the broker.

2. Agency

A. Disclosure In this paragraph, the buyer and seller acknowledge prior receipt of the Disclosure Regarding Real Estate Agency Relationships form (C.A.R. Form AD). This form must be presented to the buyer prior to signing a contract to purchase, the seller prior presenting the offer if the selling agent is not the listing agent as well, and the buyer prior to signing a contract to purchase. B. Potentially Competing Buyers and Sellers The seller and buyer are advised of and consent to the fact that either the buyer's broker or the seller's broker may represent other principals who may compete with the buyer or seller for purchase of the same property. C. Confirmation Confirmation of the agency relationship of the listing and selling agents is required under Civil Code Section 2079.17. No additional confirmation is needed if this is complete and accurate. If the seller and the buyer do not agree to what is set forth in this confirmation or if this confirmation is blank or partially blank, a counteroffer will need to be written and a confirmation on a statutory form must be attached to the counteroffer. Note: The selling broker who wrote this offer must sign and present a disclosure to the seller. This must be done before the offer is presented, even if the listing broker previously gave a written disclosure to the seller. Listing Agent - Sunshine Real Estate / Tom Baker, Broker Selling Agent - First Real Estate / Lisa Summers, Broker

11. Seller Disclosures; Addenda; Advisories; Other Terms

A. The seller must provide the buyer with a Seller Property Questionnaire or Supplemental Contractual and Statutory Disclosure within a specified time if any of these items are checked. B. This paragraph includes any addenda that supplement the purchase agreement if checked. C. This paragraph contains common advisories that will become part of the purchase agreement if checked. D. Any other addenda, advisories, or other terms related to the purchase agreement can be included here.

7. Condominium/Planned Unit Development Disclosures

A. The seller will make known to the buyer that the property is part of a development where property is shared in common with other owners or is subject to certain rules along with other owners. B. The seller must request and provide, within a specified number of days after acceptance, the contractually required documents from the homeowners' association.

10. Buyer's Investigation of Property and Matters Affecting Property

A. This paragraph gives the buyer the right to conduct an investigation of the property, within a specified period of time, and at the buyer's expense unless otherwise agreed. The inspections include the right to check for lead-based paint and wood destroying pests and organisms. The buyer must not make any invasive or destructive inspections on the seller's property. Inspections performed by government entities must have the seller's approval first. B. The seller must make the property available for buyer inspections. After the inspection, the buyer may remove the contingency or cancel the agreement within the time specified in Paragraph 14. The buyer needs to give the seller copies of any inspections the buyer ordered. C. The seller must have utilities turned on so the buyer can make the inspection(s). D. The buyer cannot hold the seller liable for any damage done to the property as a result of inspections performed on the buyer's behalf. Anybody acting on the buyer's behalf during inspections must carry insurance or similar policies that protect the seller if any injuries or damages occur during the inspections.

24. Joint Escrow Instructions to Escrow Holder

A. This paragraph identifies which portions of the purchase agreement are instructions from the buyer and seller to the escrow holder. The escrow holder disburses the broker's compensation under separate compensation agreements provided for in Paragraph 23 or Paragraph D in the Real Estate Brokers section of the agreement. B. Within three (3) business days, the parties agree to deliver the agreement to the escrow holder, unless there is a different agreed-upon time. C. Brokers are parties to the agreement for compensation purposes only. Both buyer and seller agree irrevocably to assign any broker compensation provided for in Paragraph 23 or Paragraph D in the Real Estate Brokers section of the agreement. D. Both buyer and seller agree to provide the escrow holder with a copy of any amendment affecting any paragraph that is also an escrow instruction. This must be done within 2 business days after the amendment is included.

9. Condition Of Property

A. This paragraph instructs the seller to disclose all known material facts and defects that affect the property. This includes any known insurance claims on the property within the last 5 years. B. This paragraph gives the buyer the right to inspect the property and cancel the agreement based upon the information discovered during those inspections or to request repairs or other action. C. This paragraph strongly advises the buyer to investigate the property in its entirety.

3. Listing Price and Terms

A. Write the listing price in words and in numerals. Listing Price: Four Hundred Fifteen Thousand Dollars and Zero Cents ($415,000.00) B. Extra space is provided to write the exact terms the owner requires when selling the property, such as financial arrangements or date of closing. If the broker presents an offer at the exact price and terms in the listing, the broker has earned the commission.

Semi-circular windows and oval windows

Add accent to houses. These windows were popular in Colonial times and continued to be used through Victorian and into modern times.

Triangular windows and angular windows

Add drama to contemporary houses.

E. Confirmation

Again, part of the Disclosure Regarding Real Estate Agency Relationships form is the confirmation. Agency is to be confirmed, in writing, prior to or concurrent with the execution of a listing agreement.

Lead-Based Paint Hazards Disclosure

Always include the "Lead-Based Paint Hazards Disclosure" form and a pamphlet entitled Protect Your Family From Lead in Your Home in your listing package. A seller of any interest in residential real property built prior to 1978 is required to notify every purchaser that such property may present exposure to lead from lead-based paint. Exposure to lead-based paint may cause lead poisoning in young children and pregnant women.

"Or More" Clause

An "or more" clause allows a borrower to pay off a loan early, or make higher payments without penalty.

Acceleration Clause

An acceleration clause allows a lender to call the entire note due, on occurrence of a specific event such as default in payment, taxes, insurance, or sale of the property. In addition, a lender may use the acceleration clause to call the entire note due if the borrower sells the property. In order to pay off the outstanding loan, a lender will foreclose on the loan.

Buyer's broker

An agent who represents only the buyer and has a fiduciary duty to find the best house for the least money at the terms most favorable to his or her principal (the buyer). Real estate law requires a disclosure of agency with a buyer in every transaction, but does not require an exclusive agency with the buyer. A buyer's broker, however, requires the buyer to work only with him or her for a certain timeframe. Some buyer's brokers represent buyers exclusively and do not accept listings.

Loan Assumption

An assumption clause allows a buyer to assume responsibility for the full payment of the loan with the lender's knowledge and consent. When a property is sold, a buyer may assume the existing loan. Usually with the approval of the lender, the buyer takes over primary liability for the loan, with the original borrower secondarily liable if there is a default. What that means is that even though the original borrower is secondarily responsible, according to the loan assumption agreement, no actual repayment of the loan may be required of that person. The original borrower (seller) can avoid any responsibility for the loan by asking the lender for a substitution of liability (novation), relieving the seller of all liability for repayment of the loan. In most cases, a buyer assumes an existing loan with the approval of the underlying lender. However, an alienation clause in the note would prevent a buyer from assuming the loan.

Unsecured loan

An unsecured loan is one in which the lender receives a promissory note from the borrower, without any security for payment of the debt, such as a trust deed or mortgage. The only recourse is a lengthy court action to force payment. This is the traditional I.O.U.

Seller Financing: 2nd Trust Deed

Another common source for secondary financing of a sale is the seller. If the seller is going to be the lender, he or she agrees to carry back, or act as a banker, and make a loan to the buyer for the needed amount. That loan is secured by a trust deed, in favor of the seller, recorded after the first trust deed. With a seller carry-back loan, the seller acts as the beneficiary and the buyer is the trustor. When a seller carries the paper on the sale of his or her home, it is also called a purchase money loan, just like the loan made by an outside lender. If a seller receives a substantial amount from the proceeds of a first loan, plus the buyer's down payment, it may be in the seller's interest to carry a second trust deed—possibly for income or to reduce tax liability by accepting installment payments. Example: Dave made an offer on a house owned by John, who accepted an offer of $375,000 with $37,500 as the down payment. The buyer, Dave, qualified for a new first loan in the amount of $318,750, and asked John to carry a second loan in the amount of $18,750 to complete the purchase price.

Real Estate Transfer Disclosure Statement (TDS)

As mentioned in the "Seller's Advisory", when selling or transferring residential property (one-to-four units), sellers are required by law to disclose any defects that materially affect the value of a property. The form used to disclose the condition of the property is the Transfer Disclosure Statement (TDS). Remember, the seller must complete and sign this form. Be sure to have the buyer sign and date the TDS when it is received because a buyer who receives the TDS after submitting an offer may rescind a purchase contract up to three (3) days after delivery of the TDS disclosure.

Real Estate Transfer Disclosure Statement (TDS)

As mentioned in the "Seller's Advisory", when selling or transferring residential property (one-to-four units), sellers are required by law to disclose any defects that materially affect the value of a property. The form used to disclose the condition of the property is the Transfer Disclosure Statement (TDS). Remember, the seller must complete and sign this form. First, identify the property's location by city, county, and a specific address within the city. Then date the form with the current date. 1. Indicate any substituted disclosure forms used in place of the TDS. 2. Seller's Information: Part A lists several items that the property may have. The seller checks the item and states at the bottom of the page whether any of the items do not operate. If any of the items do not operate, the problem is described. Part B discusses the condition of the structure and systems. This time the seller only checks an item if it has a significant defect or malfunction. A brief description is included for anything that is checked.

Colonial Revival style

Became popular after it appeared at the U.S. Centennial Exposition and it remained so until the mid-1950s. In the 1920s and 1930s, the Colonial Revival was the most popular revival house style in the United States. These houses are large, with two or more stories. They feature wood exteriors with tall wood columns that are typically painted bright white with dark green or black shutters. On occasion, this type of house may have a brick exterior. Colonial Revival houses are known for their graceful symmetry and elegant center entry hall.

17. Management Approval

Brokers are agents of their clients and are responsible for their sales associates. When an associate-licensee signs a listing agreement, their brokers may cancel it. The cancellation must be in writing, within five (5) days of its execution.

Monterey style

Built in 1853 when Thomas Larkin designed a house that blended the English Colonial with the single-story Spanish Colonial style, which was then prevalent in Monterey. The most distinguishing feature of the Monterey style is the second-story balcony on the front of the house. The overhanging balcony creates a shaded, protected entry. These houses often have a courtyard and wrought iron trim and fencing. The roof is a shallow pitched gable or hipped roof with red tiles or wood shakes. Windows are often tall and in pairs with false shutters.

14. Time Periods; Removal of Contingencies; Cancellation Rights

Buyers and sellers are given specific amounts of time to meet the various conditions of the contract. A. Seller Time Periods Within seven days, or a specified number of days, the seller must deliver all reports and disclosures for which he or she is responsible. B. Buyer Time Periods (1) The buyer has 17 or a specified number of days after acceptance to complete all investigations and review of reports (may include reviewing lead-based paint and hazard disclosures, a home inspection, and investigating insurability). In addition, the buyer must deliver signed copies of the statutory disclosures in Paragraph 6A. (2) Request that the seller make repairs. The seller may choose not to make the repairs. (3) Within the time period specified in Paragraph 14B(1), the buyer must deliver the appropriate forms to the seller which either remove the contingency or cancel the agreement. If the seller does not deliver any government-mandated disclosures, which are required as a condition of closing, the buyer has five days after receipt of the disclosure, in writing, to remove any contingencies or cancel the agreement. (4) The buyer retains the right to make requests of the seller, to remove contingencies, or to cancel the agreement until the seller exercises cancellation rights, even if this occurs after the expiration of time provided in Paragraph 14B(1). C. Seller Right to Cancel (1) If the buyer does not complete inspections or fulfill his or her obligations within the time specified in the purchase contract, the seller would prepare and give the buyer a Notice Of Buyer To Perform. After giving the buyer a Notice to Buyer to Perform, the seller may cancel the agreement and return the buyer's deposit if the conditions are still not met. (2) The seller may cancel the agreement and return the buyer's deposit if the buyer does not meet certain obligations provided for in the contract, such as making a deposit, providing a prequalification or preapproved letter or signing a receipt for uninsured deposit. The seller must give the buyer a Notice to Buyer to Perform before a seller can cancel due to a buyer's failure to meet these obligations. (3) The Notice to Buyer to Perform must be in writing and signed by the seller. It must also give the buyer at least 2 or a specified amount of days to take the appropriate action requested. The seller cannot deliver a Notice to Buyer to Perform earlier than 2 days before the expiration of time given for a buyer to remove a contingency. D. Effect of Buyer's Removal of Contingencies If the buyer removes any contingency or cancellation rights, in writing, the buyer will conclusively be deemed to have (i) completed all things pertaining to the contingency or cancellation; (ii) elected to proceed with the transaction; and (iii) assumed responsibility for repairs or corrections pertaining to that contingency or cancellation right. E. Close of Escrow If either the seller or buyer fails to close escrow, a Demand to Close Escrow form must be given to the appropriate party before canceling the purchase agreement. F. Effect of Cancellation on Deposits The buyer and seller agree that if the agreement is cancelled, the buyer's deposit, less costs and fees, will be returned. The buyer and seller will sign a notice of cancellation and it will be given to the holder to release the deposit. This is not automatic.

Earnest money deposit

Buyers usually give an earnest money deposit (consideration) as a sign that they are serious about making the offer. Consideration is a buyers' deposit in the form of cash, a personal check, cashier's check, promissory note, money order, or other form usually for 1-3% of the purchase price of the property.

Water Heater, Smoke Detector, and Carbon Monoxide Detector Compliance

By the close of escrow, the seller must comply with state and local laws regarding braced water heaters. The seller must provide certification of having the water heater(s) braced, anchored, or strapped in place in accordance with those requirements by signing and dating this form. The buyer must acknowledge receipt of the form with his or her signature and date. By the close of escrow, the seller must also comply with state and local laws regarding operable smoke detectors. The seller must have a certification of having operable smoke detector(s) approved and listed by the State Fire Marshal installed in accordance with the State Fire Marshal's regulations and in accordance with applicable local ordinance(s) by signing and dating this form. The buyer must acknowledge receipt of the form with his or her signature and date. Effective July 1, 2011, the Carbon Monoxide Poisoning Prevention Act of 2010 requires that carbon monoxide detectors (CO detectors) must be installed in all dwelling units that contain a fossil fuel burning heater, appliance, or fireplace; or that have an attached garage. Carbon monoxide is an odorless gas produced whenever any fuel is burned. The Consumer Product Safety Commission recommends installing a CO detector in the hallway near every separate sleeping area of the home. Sellers notify buyers on the Real Estate Transfer Disclosure Statement whether the property has carbon monoxide devices installed. No separate compliance certification is required. If the property does not have carbon monoxide devices, the buyer may negotiate with the seller for their installation as a condition of sale. [Health & Safety Code §13260 & §17926].

Interest-only loan

Called a straight loan or term loan. It has regular interest payments during the term of the note. The interest rate is generally higher on a straight note and the principal does not decrease. A large payment is made at the end of the term to repay the principal and any remaining interest. This type of loan works well for people who only want to stay in a home for a few years. If the borrower plans to live in the house for only three to five years, an interest-only loan may be the right choice. With a conventional 30-year mortgage, most of the payment is applied directly to the interest of the loan with very little applied to the principal. With an interest-only loan, the borrower will have a lower payment and have almost the same principal balance at the end of three to five years as if a conventional loan had been selected.

Partially amortized installment note

Calls for regular, level payments on the principal and interest during the term of the loan. Since the loan does not fully amortize over the original term, there is still a remaining principal loan balance. The last installment, a balloon payment, includes all of the remaining principal and interest. Balloon payments can have extra risks because the borrower may need to refinance the property—possibly at higher interest rates.

Caravan

Caravan is similar to an office preview, but it is open to all the members of the MLS.

22. Definitions

Certain terms of the agreement are defined here. The definitions of "Days", "Day after", and "Days prior" should be reviewed for the purposes of calendaring time.

Gothic arch windows

Characteristic of the Tudor style.

Contemporary style houses

Characterized by attractive, simple, clean lines and the combination of stone, glass, masonry, and wood in the exterior. These asymmetrical houses can be one or more stories with a roof that is flat or very low-pitched. Windows are often an odd shape because they follow the roofline. Sometimes the roof extends from a higher level down over a lower level. Ornamentation is simple with a vertical orientation.

Cold prospects

Cold prospects are potential clients and customers who are not in your sphere of influence, but who may want to buy or sell real estate. Therefore, you should contact anyone and everyone you believe to be a buyer or seller in need of a real estate professional.

Collateral

Collateral is the security pledged for repayment of a loan. The property being purchased is used as the security, or collateral, for the debt.

Single-hung windows

Commonplace in Ranch and modern style houses.

Conforming loans

Conforming loans have terms and conditions that follow the guidelines set forth by the Federal National Mortgage Corporation (Fannie Mae) and the Federal Home Loan Mortgage Corporation (Freddie Mac). These loans are called "A" paper loans, or prime loans, and can be made to purchase or refinance homes (one to four residential units). Fannie Mae and Freddie Mac guidelines establish the maximum loan amount, borrower credit and income requirements, down payment, and suitable properties. Fannie Mae and Freddie Mac announce new loan limits every year. This limit is reviewed annually and, if needed, modified to reflect changes in the national average price for single-family homes.

Niche market

Consists of consumers with the same specialized needs.

Victorian

Describes many styles built between the 1830s and early 1900s. For the first time since the beginning of the Industrial Revolution, machines could mass-produce affordable, ornamental building materials such as moldings, columns, brackets, spindles, and patterned shingles. As a result, architects and builders eagerly incorporated the elaborate bric-a-brac, excessive gingerbread, trim work, and other ornamentation in Victorian style houses. Although the last true Victorian houses were built in the early 1900s, contemporary builders borrow Victorian ideas, creating "Neo-Victorians". Three more popular Victorian styles are the Second Empire, Queen Anne, and Folk Victorian.

"Disclosure Regarding Real Estate Agency Relationships" form

Describes the obligations of an agent as "seller's agent", "buyer's agent", or "dual agent". At this point, all parties are made aware that they do have a choice of who is to represent them as their own agent. A written disclosure must be presented by a: listing agent (or his or her sales associate) who must deliver the form to the seller before entering into a listing agreement. selling agent (who may also be the listing agent) who must provide the form to the buyer before the buyer makes an offer to purchase. selling agent (if different from the listing agent) who must provide the form to the seller before the offer to purchase is accepted.

Prairie style

Designed by Frank Lloyd Wright and other Chicago architects, is an extension of the bungalow design in many ways, but it is much more expensive to build. The Prairie style houses are much larger than the Craftsman Bungalows and are designed with low horizontal lines that require larger lots. They have low-pitched hip roofs with large overhanging eaves, casement windows, and rows of small, high windows. Due to the complexity of the designs, these houses require on-site architects and experienced builders. As a result, they are not marketed as pre-cut "kits" and are built primarily for the wealthier clientele.

Direct Marketing

Direct marketing refers to making phone calls and mailing or emailing promotional materials directly to potential customers as opposed to through mass media. Direct marketing is also known as push marketing because you send information to potential customers to attract the few who may have interest in you or your listings. Direct marketing has advantages and disadvantages. The benefit is that your marketing pieces and messages are sent directly to your target market. However, unwanted telephone calls may be blocked, unsolicited marketing pieces may be considered junk mail, and unwanted email messages may be considered spam.

Palladian window

Divided into three parts, with rectangular panes on each side of a wide arch. They are placed at the center of an upper story as a focal point in Colonial or Queen Anne houses. You may see them in modern houses with cathedral ceilings.

20. Entire Agreement

Do not rely on oral promises or other written documents that are not included in this agreement. Remember, to be enforceable real estate contracts must be in writing. Any verbal promises (if not included in the written contract) do not have to be honored. This clause reminds sellers to be sure the contract states what they expected in the listing agreement with the broker.

Jalousie windows

Do not slide or use a hinge, instead, they have narrow glass slats like Venetian blinds that are opened and closed with a crank.

Queen Anne style

During the second half of the 19th century, for the first time, emerging middle-class homeowners had access to affordable, mass-produced finished windows, doors, turned spindles, brackets, and decorative scrollwork. Prior to the advanced manufacturing techniques, these decorative ornamental details were a luxury that only wealthy people could afford. The builders used every conceivable manufactured ornamental trim that was available to create these elaborate styles. The houses were built with multiple stories with projecting wings, a complicated roofline with very steep cross-gabled roofs, towers, turrets, vertical windows and balconies, multiple chimneys with decorative chimney pots, scrollwork, bric-a-brac, gingerbread, and gingerbread with frosting. A chimney pot is a round or octagonal "pot" on the top of each flue. Queen Anne style houses usually have several wide porches with turned posts and decorative railings. The wood siding is painted white or pastel with contrasting trim and it probably has a round tower or enormous round bay windows.

Early move-in

Early move-in allows the buyers to take possession of the property prior to the close of escrow. This should be carefully evaluated to avoid the risk of possible lawsuit due to inadequate insurance coverage, mechanics' liens, and/or buyer's remorse. A written early occupancy agreement (Interim Occupancy Agreement—Form IOA) should be completed and signed by the sellers (as landlord), the buyers (as tenant), the listing agent (representing the sellers) and the selling agent (representing the buyers). The real estate brokers are not a party to the agreement between landlord and tenant, and agency relationships are confirmed within the agreement.

11. Photographs and Internet Advertising

Effective marketing requires photographs, virtual tours and other media to show buyers the benefits of a property. This paragraph indicates that the seller agrees to let the broker take photos (images) of the exterior and interior of the property for marketing purposes. Sellers may check the appropriate box if they do not want images of their property submitted to the MLS, placed on the Internet, or used for marketing purposes. Once the images are placed on the Internet the broker and the seller have no control over who can view or use them. In addition, prospective buyers and other people might take photos, videos, or other images of the property and sellers or their brokers cannot block them from taking or using the images. A seller may check a box restricting that images may only be taken by appraisers or home inspectors, but that unauthorized persons may still take images despite the limiting instruction.

Tudor style

English Tudor is a large, two-story masonry or stucco, steep-gabled house with a definite medieval feel. The Elizabethan (Tudor Revival) variation of this style is asymmetrical, has a very steep cross-gabled roof, a prominent chimney, and half-timbered exteriors. Both styles are characterized by patterned brick or stone walls, rounded doorways, and multi-paned casement windows. Inside, Tudor houses have intricate wood paneling or moldings. They feature arched entries, projecting oriel windows on the second floor, and large leaded-glass windows with stone mullions. Another characteristic is the massive chimney placed in a prominent location and often topped with a decorative chimney pot. Initially, only very wealthy people could afford to build these large, elaborate mansions. They are expensive to build because of the various features such as the complex roof system with various gables of alternating heights, dormers, and large sculpted brick chimneys. However, many suburban houses are built today with Tudor influences, which make them accessible to mainstream America.

1. Exclusive Right to Sell

Enter the full, legal name of the owner and the real estate office or broker receiving the listing. If someone other than the broker, such as a salesperson, takes the listing, the salesperson should write his or her employing broker's name. Enter the time period after the broker's name. The time period should include the beginning April 01, 20XX and the termination date June 30, 20XX. Enter the location of the property. Identify the property's location by city, county, and a specific address within the city. The location of the property by lot, block, and tract, or a metes-and-bounds legal description may also be given. In some cases, it may be necessary to sign and attach a legal description to the listing. Seller(s): Fred Spring and Jan Spring Broker: Tom Baker Listing Period: April 1, 20xx to June 30, 20xx Address: 1652 Hill Street, Any City, Apple County, California, 90000 Assessor's Parcel No.: PQ9856 Property Description: Single-family detached house The salesperson completing the form should sign his or her name at the bottom of the form.

Buyer's New Loan Instructions and Documents

Escrow accepts loan documents or instructions about financing the subject property and completes them as directed. The escrow officer gets the buyers' approval of and signature on loan documents then receives and disburses loan funds as instructed.

Escrow instructions

Escrow instructions are the written authorization to the escrow holder or title company to carry out the directions of the parties involved in the transaction. The instructions, as you recall, reflect the agreement between the sellers and buyers as seen in the offer to purchase (deposit receipt) and usually include all disclosures required by law. Escrow instructions are either unilateral, where the buyers sign one set of instructions and the sellers sign another, or bilateral, where the sellers and buyers sign the same set of instructions. Escrow instructions state any conditions that both parties must satisfy in order to close the deal, such as who will pay for what, how the escrow holder disburses monies, and what documents are recorded at the close of escrow. If any changes in the original instructions are required, the escrow officer must draw up an amendment for each change. Perhaps the sellers want to close escrow later than the original date agreed upon, or maybe the buyers want to get an adjustable loan rather than a fixed rate as previously stated in the offer to purchase. No matter how small the detail, if it differs from the original agreement, all parties to the escrow must agree to the change by signing an amendment.

Escrow

Escrow is the period during which all terms of the contract, including any contingencies, must be met. Therefore, if these contingencies are not met escrow cannot close.

D. Other Sellers

Even though this listing agreement is an exclusive agency, it does not mean that the broker cannot represent other sellers or buyers as well.

26. Dispute Resolution

Even with the most smoothly run or meticulous transaction, disputes may arise. To try to settle any disputes amicably, the contract offers both mediation and arbitration. Both buyer and seller must agree to be bound by mutual arbitration in order for the clause to be effective. A. Mediation This clause is not optional. The buyer and seller must agree to mediation by a neutral mediator in the attempt to resolve disputes. Both parties must also agree to mediation for disputes that may arise with brokers. If any party does not attempt mediation before filing an arbitration or court action, they will not be entitled to be awarded attorney's fees even if they are the prevailing party. B. Arbitration of Disputes The buyer and seller agree to arbitration if a dispute cannot be resolved through mediation. This also applies to disputes with brokers. The arbitrator will be a retired judge with experience in real estate law or an arbitrator that the disputing parties mutually approve. This paragraph must be initialed by the buyer and seller. If at least one, but not all parties initial, a counteroffer is required until agreement is reached. Any exclusions to this arbitration agreement are outlined in Paragraph 26C. C. Additional Mediation and Arbitration Terms (1) This subparagraph lists the matters that are excluded from mediation and arbitration. (2) A broker does not have to mediate or arbitrate with a buyer or seller unless he or she agrees to the terms in writing.

Buyer/Seller Types

Examples of these might be first time homebuyers, investors, pre-foreclosures, etc. First-time homebuyers might be segmented into groups that need special assistance programs and groups with good incomes but no down payment moneys. Investors could be segmented by property types in which they are interested. A segment of sellers would include FSBOs. FSBOs (For Sale By Owner) are properties that the owner has not listed with a real estate broker.

Exempt Transactional Email Messages

Facilitating or confirming an existing commercial transaction, such as an existing listing or sales transaction Sending purely informational messages, such as a newsletter without advertisements Giving notice about product updates or upgrades Providing notice about certain changes in a subscription, membership, account, or loan Providing warranty information, product recall information, or safety or security information with respect to a commercial product or service used or purchased by the recipient Providing information directly related to an employment relationship in which the recipient is currently involved An unsolicited email message sent by a real estate agent to people on a mailing list to offer that agent's services is a commercial email message.

How many basic types of houses are there in the United States?

Five. In the U.S., the five basic types of houses are one-story, one-and-one-half story, two-story, split-level, and multiple-story.

Floor time

Floor time refers to the set hours that a sales associate must be in the brokerage office to answer incoming phone calls and handle inquiries from walk-ins.

Office preview

For the other salespeople in the office to preview the listing and get a head start on selling it

Georgian style

Formal, symmetrical lines, was favored by the well-to-do and became a symbol of the owner's financial standing in the community. It has paired chimneys (one on each side) and five windows across the front of the second story.

Pocket doors

Glide or roll on suspended or overhead tracks

American Foursquare

Has become one of the most common housing styles in the United States. This practical style, based on the Prairie style, is sometimes called the Prairie Box. It is a very simple, space-efficient box shape, with a wide porch across the entire front of the house. The front door is centered with matching casement windows on either side. The pyramid-shaped hip roof has a large dormer centered in the front of the house. Because they are symmetrical and uncomplicated, they were easier to build and cost less than the more complicated Victorians. This was another style sold by Sears, Roebuck & Company as a mail order pre-cut "kit" house. Sears even sold a machine that could make the cement blocks on site that were used in the construction. This resulted in the American Foursquare spreading to residential neighborhoods throughout the United States. This style may still be found in older neighborhoods.

Agency Relationship Disclosure Act

Has been in effect since January 1, 1988. Its purpose is to clarify the agency relationships between sellers, agents, and buyers and applies to every residential property transaction of one-to-four units. The agency disclosure is probably one of the most important documents available to the consumer. The law is finally clear about who is legally representing whom. Buyers or sellers can be confident that their best interests are being represented by an agent on their side in the negotiations. As a licensee, you must use the "Disclosure Regarding Real Estate Agency Relationships" form explaining the nature of agency. The law is very clear about your responsibility for full disclosure. Misunderstanding or ignorance of the law is not a defense. A real estate license may be revoked or suspended for violation of the agency disclosure law. This disclosure must be made prior to taking a listing or writing an offer.

Casement windows

Have hinges on the sides and are opened with cranks. Dutch Colonial, Craftsman, Tudor, Mission, Ranch, and other modern style houses have casement windows. A French window is actually two casement windows placed side by side.

Transom window

Hinged at the top and opens into the room

Awning window

Hinged at the top and opens out.

Section 255 Home Equity Conversion Mortgage

Home Equity Conversion Mortgage (HECM) is a type of reverse annuity mortgage. It is a program for homeowners 62-years old and older who have paid off their mortgages or have only small mortgage balances remaining. The program has three options for homeowners: (1) borrow against the equity in their homes in a lump sum, (2) borrow on a monthly basis for a fixed term or for as long as they live in the home, or (3) borrow as a line of credit. Borrowers are not required to make payments as long as they live in the home because the loan is paid off when the property is sold.

8. Items Included In and Excluded From Purchase Price

If a buyer wants an item of personal property belonging to the seller, such as drapes, bedspread, or washer and dryer; the deposit receipt must show that both the buyer and the seller agree to the transfer of the personal property. A. Note to Buyer and Seller The contract determines what is or is not included in the sale of the property; information from other sources is not determinative. B. (1) - (5) Items Included In Sale Unless personal property items are excluded in the listing agreement, the buyer may assume that what they see in the property is included in the sale. If additional items are to be included, list them here in detail. (3) The following additional items: Gas range and side-by-side refrigerator C. Items Excluded From Sale The seller and the buyer may specifically indicate items to be excluded from the sale. If additional items are excluded, list them here in detail.

15. Attorney's Fees

If a disagreement arises between the seller and the broker, and they go to court or arbitration, the loser in either incident must pay the costs. This paragraph tends to help reduce frivolous lawsuits.

12. Keysafe/Lockbox

If sellers want the most access to their home, they should authorize the listing broker to put a lockbox on the property. A lockbox makes the property more available for showing by other agents in the MLS. The agent is not liable to the owner for loss or damage resulting from access via the lockbox. If the seller chooses to have the property shown by appointment only, then the listing agent may not want to use a lockbox. The seller checks the box only if he or she does not want a lockbox.

Homeowner's Guide to Earthquake Safety

If the home was built prior to 1960, the homeowner must give The Homeowner's Guide to Earthquake Safety booklet to buyers. This booklet has California earthquake maps, before and after pictures of homes damaged by earthquakes, how to use the gas shutoff valve, and other useful information.

29. Expiration of Offer

If the offer is not accepted by the seller within the time specified, the offer is revoked and any deposit is returned to the buyer. A deposit may be refunded by agreement, judgment, or arbitration. If other than the buyer, write the name of the person authorized to accept a copy of the signed offer. Write the date and time when the offer should be received. Buyer's Representative - First Real Estate April 16, 20xx at 5:00 pm Write out the date and the name of the buyer(s) as well as the buyer(s) current home address. Sam Winter and Cindy Winter 901 Cherrywood Lane, Some Town, CA 90000

Do Not Call

In 1991, Congress passed the Telephone Consumer Protection Act (TCPA). In 2003, the FCC established, together with the Federal Trade Commission (FTC), a national Do Not Call Registry. This registry is nationwide in scope, applies to all telemarketers (with the exception of certain non-profit organizations), and covers both interstate and intrastate telemarketing calls. You cannot make unauthorized calls to people whose names are on the registry, subject to certain exceptions. Today there are millions of numbers on that list. he rules do not apply to calls made if an established business relationship already exists. With an established business relationship, the caller had a transaction with the receiver within the last 18 months; or the customer has made an inquiry or submitted an application with the caller's firm in the last 3 months.

Deed of Trust

In California, the deed of trust (or trust deed) is the most commonly used security instrument in real estate finance. A trust deed is a security instrument that conveys title of real property from a trustor to a trustee to hold as security for the beneficiary for payment of a debt. The three parties to a trust deed are the borrower (trustor), lender (beneficiary), and a neutral third party called a trustee. The trustor (borrower) signs the promissory note and the trust deed and gives them to the beneficiary (lender) who holds them for the term of the loan. Under the trust deed, the trustor has equitable title and the trustee has "bare" or "naked" legal title to the property. The trustee acts as an agent for the beneficiary and has only two obligations. The first is to foreclose on the property if there is a default on the loan and the second is to reconvey the title to the borrower when the debt is repaid in full.

Dual Agency

In a dual agency, the selling agent is also the listing agent, representing both buyer and seller, requiring the knowledge and consent of both. The existence of the dual agency, with its implied conflict of interest, requires written disclosure prior to making an offer or as soon as practicable.

Home Equity Loan

In a home equity loan, the borrower gets the entire loan balance at one time. It is a fixed-rate second mortgage with principal and interest payments remaining the same over the life of the loan. Equity is the difference between the value of the property and any outstanding loans or the initial down payment. Assuming there is enough equity, a homeowner can apply for a cash loan for any purpose. Being a homeowner can be advantageous, especially if there is built-up equity in a house, townhouse, duplex, or condominium. The equity can pay for home improvements, bill consolidation, or college tuition.

California Residential Purchase Agreement and Joint Escrow Instructions (RPA-CA)

In most cases, a standard California Residential Purchase Agreement and Joint Escrow Instructions (RPA-CA) contract is used by real estate agents when a buyer makes an offer anywhere in California. It was created by the California Association of REALTORS® (C.A.R.). The Bureau of Real Estate does not officially recommend this form; nor is any type of specific form required by law. Real estate agents do have an alternative, however, among the standard C.A.R. forms, depending on the custom in their area of the state. Real estate practices differ significantly in different parts of California and some of those differences are not reflected in the commonly used deposit receipt. An alternate form, Area Edition Residential Purchase Agreement (AERPA- 11) is available to real estate agents who desire features not included in the other form. The RPA-CA is probably the most important real estate document you—as a salesperson—will have to understand. Buyers rely on your knowledge, and your commission depends on your ability to explain a complex transaction. Become familiar with the entire document before writing the offer. As you go through each section of the form systematically, refer to the numbered sections below for assistance or explanation. The offer covers more than just the purchase price and closing date. It covers contingencies, various inspections, mandatory disclosures, buyer's rights to investigate the property, how the buyer will take title, damages and dispute resolution, escrow instructions, compensation to the brokers and acceptance of the offer.

Good funds

In order to close escrow, buyers must deposit sufficient funds to cover escrow and closing costs. Sometimes the escrow will use the term good funds. Good funds include cashier's checks, certified checks, or wired funds. A personal check is not considered good funds because it may take several days for the check to clear. If buyers plan to use a personal check, remind them to send it at least ten days before the close of escrow.

Residential Environmental Hazards

Increasingly, buyers are concerned about potential environmental hazards that may be present in a home they are considering to purchase. You may provide them with a booklet called Residential Environmental Hazards: A Guide for Homeowners, Buyers, Landlords, and Tenants. This booklet contains information regarding environmental hazards, which may affect residential property. It should be used only as a general guide to make homeowners and prospective homeowners aware of which environmental hazards are common, where they are found, and how they can be made less severe. You are not legally required to give the booklet to a buyer. However, the law does state that delivering the booklet to a buyer is considered to be giving adequate information regarding any environmental hazard described in the booklet. It is suggested that homeowners, homebuyers, landlords, and tenants seek professional assistance to determine how to handle these environmental hazards if they exist.

Institutional advertising

Institutional advertising is designed to create an image, enhance the reputation, and promote the person or company rather than a specific product. The Century 21® television ads are a good example of institutional advertising that reinforces the franchise brand. In addition, NAR uses institutional advertising effectively to promote the real estate industry. Often, NAR allows its affiliate member associations to customize the advertisements for use in their states and local areas.

A-frame style

Introduced in 1957 by the architect Andrew Geller, is ideal for cold, snowy regions. Instead of piling up on top of the roof, the snow slides down the steep slope of the A-frame roof. The triangular-shaped roof has deep-set eaves and goes all the way to the ground on two sides of the house. The large picture windows and doors are situated at the front and back of the house.

Promissory note

Is the evidence of the debt

Natural Hazard Disclosure Statement (NHD)

It was mandated in March 1998 that sellers of many residential properties would give prospective buyers the "Natural Hazard Disclosure Statement" form. This statement warns prospective buyers that certain "hazards may limit your ability to develop the real property, to obtain insurance, or to receive assistance after a disaster". These hazards include: a Special Flood Hazard area designated by the Federal Emergency Management Agency. an Area of Potential Flooding in the event of a dam failure, designated by the state Office of Emergency Services. a Very High Fire Hazard Severity Zone designated by the California Department of Forestry and Fire Protection. a Wildland Fire Area that may contain substantial forest fire risks and hazards, designated by the State Board of Forestry. an Earthquake Fault Zone designated by the State Geologist. a Seismic Hazard Zone designated by the State Geologist. the local hazard natural hazard zones (including land sliding, liquefaction, etc). The statement also advises buyers and sellers that they "may wish to obtain professional advice regarding these hazards". Since most sellers are not soils engineers or geologists, it is a good idea to advise them to hire a professional to prepare the natural hazard statement.

2. Items Excluded and Included

Items of real or personal property excluded from or included in the purchase are listed here. Listing the items the seller intends to include in the sale helps prevent future problems. Additional Items Included: Gas Range and Side-by-Side Refrigerator

Walk-Through

Just before the actual closing (generally within five days before the close of escrow), schedule a final walk-through of the property to be certain it is in the same condition as when the purchase offer was made. Make sure that any required work is satisfactorily completed. Recheck for any undisclosed items that might affect the property's use, such as party walls, access roads to other properties, common drives, irrigation canals or ditches, or people in occupancy or possession of the property, which county records would not disclose.

French Provincial style houses

Large, square, symmetrical two-story houses with a distinctive steep, high, hip roof. The exterior is usually white brick or stucco. Windows and chimneys are symmetrical and perfectly balanced. Frequently, tall second floor windows break through the cornice. They have balcony and porch balustrades; rectangular doors set in arched openings; and double French windows with shutters. Unlike French Normandy houses, French Provincial houses do not have towers.

Adjustable-Rate Mortgage (ARM)

Lenders have created alternative payment plans such as the adjustable-rate mortgage, which allow borrowers to qualify for larger loans and at the same time help maintain the lender's investment return. An adjustable-rate mortgage (ARM) is a note with an interest rate that is tied to a movable economic index. The index is the overall average of market interest rates that a lender will use to determine the rate of an ARM. The interest rate in the note varies upward or downward over the term of the loan, depending on the agreed-upon index. To protect the borrower from wild swings in interest rates, there is usually a limit on how much the interest rate can change on an annual basis, as well as a lifetime cap. A cap is a limit on changes in interest rate. The borrower's payment will stay the same for a specified time, which might be six months or a year, depending on the agreement with the lender. At the agreed-upon time, the lender re-evaluates the loan to determine if the index has changed, either upward or downward, and calculates a new payment based on the changed interest rate plus the same margin. Generally, adjustable-rate financing benefits the bankers because it allows for an inflow of extra cash during times of higher interest rates. In other words, the borrower's payments will increase because the interest rate will go up, therefore more money will flow into the financial institution.

Late Payments

Lenders may not impose a late charge on a payment until after the payment is ten days late.

Loan-to-value

Loan-to-value is the percentage of appraised value to the loan. An 80% loan would require the borrower to make a 20% down payment. Loans made with less than a 20% down payment will require mortgage insurance. If the appraisal is below the asking price of the home, the lender may require a larger down payment to make up the difference between the price of the house and its appraised value.

Jumbo Loans

Loans that are above the maximum loan limit set by Fannie Mae and Freddie Mac are called jumbo loans. Because jumbo loans are not funded by these government-sponsored entities, they usually carry a higher interest rate and some additional underwriting requirements.

Adobe bricks

Made with a mixture of clay and straw, formed into brick shapes, and dried in the sun rather than in a kiln. Adobe bricks are larger than standard bricks. Although very energy efficient, they do not withstand earthquakes, which is why you will find this material in Arizona and New Mexico rather than California. Adobe bricks are used in Spanish-Colonial, Monterey, Pueblo, and Santa Fe architectural styles.

Bow window

Made with curved glass.

Estimated Buyer's Closing Costs

Many buyers think the down payment is the only money they need to pay for a house and are unprepared for the closing costs (additional costs needed to close escrow). Be sure to explain that these costs may be up to 1.5% of the purchase price, not including loan points. Closing costs vary from county to county, but your broker should have estimates for you to use for transactions in your area. It is better to estimate costs on the high side, because if the actual closing costs are less, the buyers are pleasantly surprised. Your broker should have estimated buyer's closing costs for transactions in your area. In addition to information from the Case Study, please use the following amounts when completing the Estimated Buyer's Costs form. These are typical buyer's costs for Any City, California. Lender's prepaid interest (allow 15 days or $795.00) ($332,000 x 5.75% divided by 360 days x 15 days). The lender will charge a 2% loan origination fee for the first loan ($332,000 x 2% = $$6,640). The lender will also charge $350.00 as a processing and underwriting fee.

Semicircular fanlights or sunburst lights

Many houses today have semicircular fanlights or sunburst lights above the entry door; these are characteristic of the Colonial Revival and Adam style.

Target marketing

Marketing to a precise group of consumers, is a necessity. Real estate professionals must quickly identify their highest-valued customers and prospects in order to succeed. With this insight, salespeople can then develop fine-tuned marketing strategies to draw these customers to their properties and win their business.

Property Type Markets

Markets are defined by the type of property—single-family homes, condominiums, lofts, vacation homes, golf course properties, etc. Again, these groups can be further segmented by price ranges, amenities, location, or age to name just a few variations.

Shed style

Modern style characterized by its asymmetrical style and multiple roofs sloping in different directions. Typically, exterior walls are stucco or wood, with small windows and recessed doorways.

International style

Modern, asymmetrical, and very practical in its use of concrete, glass, and steel to create sleek lines. With a flat roof and floor-to-ceiling "window walls", the design is avant-garde.

Residential Listing Agreement—Exclusive

Most commonly used. (Exclusive Authorization and Right to Sell), where the broker is the sole agent and has the right to a commission. The broker has the sole right to obtain a purchaser for a property. If, during the listing term, a buyer is found by anyone, including the owner, the seller must pay the listing broker a commission if the property is sold within the time limit. By law, all exclusive listings must have a termination date. The property may be sold by the listing broker, any other broker, or the owner. From the broker's point of view, this type of listing is the most desirable. Note: If the broker brings the seller a "mirror offer", (an offer that matches all terms in the listing), the seller does not have to accept the offer, but under the terms of the listing, the seller must pay the broker a commission.

Negative amortization

Negative amortization occurs if a borrower makes lower payments than should be made on a fully amortized loan. The difference between what should be paid and what is actually paid is added to the principal balance of the loan and the principal increases instead of decreases.

Prepayment Clauses

Occasionally, a trust deed will include a prepayment clause. This is a penalty fee that a borrower is responsible for if a loan is paid off too early. When lenders make loans, they calculate their return over the term of the loan. If a loan is paid off ahead of time, the lender gets less interest; therefore, the borrower has to make it up by paying a penalty.

30. Acceptance of Offer

Once the deposit receipt is accepted and signed by the seller and the acceptance is communicated to the buyer, it becomes a legally binding contract. Death or incapacity does not automatically cancel a contract. If the seller dies or becomes incapacitated after acceptance of the offer, the seller's heir(s) must complete the sale. Seller's Signature Section By signing the agreement, the seller agrees to sell the property on the exact terms and conditions of the offer. The seller also confirms the agency relationships and agrees to pay the identified broker the amount of compensation for services set forth in a separate, written agreement. Confirmation of Acceptance A contract is formed when the seller's acceptance is received in person by the buyer or buyer's agent. This paragraph provides evidence of the date of acceptance.

From Offer to Closing

Once the selling agent procures a buyer and writes an offer on a property, the following forms are applicable: Optional (Selling Agent to provide): 1. BBE: Buyer-Broker Agreement - Exclusive 2. BBNE: Buyer-Broker Agreement - Non-Exclusive 3. BBNN: Buyer-Broker Agreement - Non-Exclusive/Not for Compensation Mandatory (Selling Agent to provide): 4. AD: Disclosure of Real Estate Agency Relationship 5. RPA-CA: Residential Purchase Agreement 6. BIA: Buyer's Inspection Advisory If Applicable: 7. COP: Contingency for Purchase or Sale of Other Property 8. IOA: Interim Occupancy Agreement 9. RLA: Residential Lease After Sale 10. Counter Offer(s), if any Strongly Recommended 11. WPA: Wood Destroying Pest Inspection and Allocation of Costs 12. RDN: Receipt and Delivery of Notices to Perform 13. CC: Cancellation of Contract (decide what happens to money if escrow cancels) 14. CBC: Cooperating Broker Commission Agreement

Final Closing Statements

One of the escrow officer's main jobs is to present the obligations of each party in a personalized closing statement. The closing statement is an accounting of funds made to the sellers and buyers individually, and it is required of the escrow holder at the completion of every real estate transaction. The sellers and buyers are both credited and debited for their agreed-upon share of costs. The debit and credit columns on the closing statement are marked sellers/lender or buyers/borrower, depending on whether it describes a sale or loan escrow. The closing statement outlines the flow of consideration through escrow, as well as the adjustments and disbursements that reflect the prior agreement of the parties.

Bungalows

One of the most common houses found in older neighborhoods and are characterized by simplicity and emphasis on horizontal rather than vertical lines. The economical bungalow started on the East Coast, became popular in California, and quickly spread across the nation. In fact, between 1890 and the mid-1900s, they became so popular that Sears, Roebuck & Co., and Montgomery Ward offered mail-order pre-cut "kit" houses that were assembled at the building site. Before World War I, a small bungalow could be built for $900, while a much larger one cost about $3,500. Because they were so affordable, the bungalow symbolized homeownership to thousands of people. These homes were ideal for the first-time homebuyer—small, inexpensive to build, and often included built-in furniture. The living room fireplace was usually large with a mantel and surrounds of brick, natural stone, or tiles. These features created a warm, homey atmosphere. In California, it is typical to see bungalows with Craftsman lines or in a Spanish Colonial motif. In Chicago, bungalows are mostly brick and boxy with Prairie influences.

Mediterranean style

One of the most common styles found in Southern California is the blend of the Italian, Moorish, Byzantine, and the early California mission styles to create a Mediterranean style. This style is very popular in all price ranges and house sizes. Look for white or light-colored stucco on the exterior and a red tiled gable roof with very little or no overhanging eaves. Additional features include arched doorways and windows, courtyard entrances, patios, ornamental tile, and wrought iron ornamentation.

Dutch Colonial Revival houses

One to two-and-one-half stories with shed-like dormers. They are easily identified by a distinctive gambrel roof. The front door may be a Dutch door, which is a horizontally divided double door.

Comparables

Or comps, are similar properties sold on the open market and offered for a reasonable length of time that are used to prepare a CMA for a subject property. Typical comparable categories include neighborhood location, view, size (comparable number of bedrooms/bathrooms as well as square footage), age, architectural style, financing terms, and the general price range. Most comps are taken from the Multiple Listing Service (MLS).

Mission style house

Originated in California, the style is often called the California Mission style. These houses are easily recognized by the round parapets on the roof that resemble those found on early Spanish colonial churches. A parapet is a low wall projecting from the edge of a platform, terrace, or roof. They are one to two stories, rectangular shaped, and have flat roofs with red tile accents. The exterior walls are adobe or smooth stucco. Most Mission style houses have arched windows and a small courtyard entry with an arched front door. Some Mission style homes have quatrefoil (four-petal) decorative windows, an arcade style (multiple arches) entry porch, square or twisted columns on the second story, and even a bell tower.

Postmodern or Neo-Eclectic

Other times, the ideas are taken from more than one architectural source and create an eclectic mixture that is difficult to categorize. Whether one or more features are chosen, the result alludes to, but does not mimic, the historic styles. These styles are called Postmodern or Neo-Eclectic. Neo means new and eclectic refers to combining a variety of details from different styles to produce a harmonious look.

25. Liquidated Damages

Parties to a contract may decide in advance the amount of liquidated damages that would be paid. Liquidated damages are the monies agreed upon by both parties to a contract that one will pay to the other upon backing out of the agreement. The purchase agreement, or sales contract, usually contains a printed clause that says the seller may keep the deposit as liquidated damages if the buyer backs out without good reason. In the event the buyer defaults on the contract, the liquidated damages cannot exceed 3% of the purchase price if the property is a single-family residence. Note: In order for this clause to be included as an obligation, it must be initialed by the buyer and seller. If at least one, but not all parties initial, a counteroffer is required until an agreement is reached.

English Cottage style

Patterned after the rustic cottages constructed in the Cotswold region of southwestern England since medieval times. Like their Tudor cousins, they are asymmetrical with an uneven sloping roof of slate or cedar that mimics the look of thatch. The exterior may have brick, stone, or stucco with half-timbering. The multi-pane casement windows and low entry door help create a cozy feeling. Many homes have a prominently placed chimney made of brick or stone.

Demographic Markets

People are often grouped into demographic markets by their shared experiences or social and economic characteristics. Age, language, marital status, income level, or just about any grouping could characterize demographic markets. Any demographic group could be further differentiated. For example, you could market to singles who are first-time homebuyers, single mothers, or older singles whose spouse has passed away. All of these are readily identifiable niches although not all can necessarily be cost effectively reached with your marketing message.

Personal selling

Personal selling is any form of direct communication (usually face-to-face) between a salesperson and a customer. Personal selling opportunities can occur at any time, such as working an open house, making a listing presentation to a seller, showing properties to a prospective buyer who has come into the office while you have floor time, or contacting FSBOs.

Product advertising

Product advertising is designed to promote a specific product or service. In real estate, the product is usually a listed property, so product advertising is used to market a specific home.

Craftsman Bungalow

Promoted by Gustav Stickley in his magazine, The Craftsman, has a tendency to be larger than the traditional California Bungalow. Other differences include rows of high, small "ribbon" windows, full-width porches framed by tapered columns, and overhanging eaves with exposed rafters. Stickley was a furniture designer and most of his plans for Craftsman Bungalows included built-in furniture throughout the house, such as kitchen cabinets, window seats, and buffets in dining rooms. Partial walls with bookshelves are frequently used as room dividers, as are chest-high cabinets topped by square, tapered pillars that reach to the ceiling. Leaded glass and stained glass in doors, cabinets, and windows are typically seen. The overall feeling is one of casual comfort.

Proration

Proration is the process of distributing or dividing the expenses or income between the sellers and the buyers usually up to the date of closing or the date of possession. The most common items that are prorated include real property taxes, interest on loans, insurance premiums, rent or assessments, and sewer charges.

Psychographic Markets

Psychographics are any attributes relating to personality, values, attitudes, interests, or lifestyles. Examples of this segment are horse lovers, golfers, NASCAR fans, boat owners, and the like. Horse lovers might be further segmented by those who board their horses and those who want acreages on which to live and raise their horses. Boat owners could be segmented by those who want lake or ocean access. Possibly the person simply wants to live full-time onboard anchored in a marina.

Pull marketing

Pull marketing attracts customers to you. A good example is advertising that draws visitors to your website when they are actively seeking the services or products you provide. Your marketing should be designed to pull potential customers and clients to you.

Do Not Call Rules

Real estate licensees may make calls between 8:00 AM and 9:00 PM. Licensees must identify themselves before making the solicitation, must identify that the call is a solicitation, and disclose all material information related to the solicited service. Licensees may not use caller ID blocking. Telemarketers must scrub their contact lists against the national Do Not Call registry every month.

Spanish Colonial Revival houses

Rectangular, symmetrical, and two stories high. They have low-pitched gable roofs with ceramic tiles, eaves with little or no overhang, stucco walls, wrought iron, and windows and doorways with round arches.

Colonial styles

Rectangular, symmetrical, two to two-and-one-half story houses with windows arranged in an orderly fashion around a central front door. Living areas are on the first floor, with bedrooms on the second floor. The windows usually have many small, equally sized square panes and decorative shutters. Typically, roofs are hip or gable.

Glazing patterns

Refer to the way windowpanes are placed into a frame.

Siding

Refers to overlapping horizontal boards made from wood, vinyl, or aluminum that are applied to the house. Sometimes a house has "board and batten" which is an application of vertical boards with joints that are finished by thin vertical strips. Siding is found in a wide variety of styles including Cape Cod, Colonial, Queen Anne, Craftsman, Contemporary, and Ranch.

"Five-ranked"

Refers to the five rectangular windows equally spaced across the second story of Georgian Colonial-style houses.

14. Equal Housing Opportunity

Sellers and brokers must abide by the federal and state fair housing laws. This statement affirms that the property is offered in compliance with anti-discrimination laws. The seller may not reject an offer on the property because of discrimination based on race, color, creed, etc.

Ribbon windows

Several rectangular windows placed in a row with their frames abutting, and are a distinctive feature in Craftsman and Prairie style houses.

Listing package

Should include information about the seller's property, professional details about you and your brokerage, samples of your advertising and marketing pieces, and all the forms necessary for listing the property. A carefully prepared listing package will help achieve a position of trust, accountability, and communication with the seller.

Net sheet

Shows the approximate net amount of money sellers can expect to receive for a specified sales price. It is a line-by-line description of the fees associated with the sale of their home, including commission. The price of the home is based on the figures you calculated when you prepared your CMA for the property. Use your recommended listing price in the net sheet to determine the estimated cash proceeds. The figures you place in the net sheet are estimates you have arrived at based on usual and customary escrow fees, proration, inspections, and title insurance fees, to name a few.

Unicast ad

Similar to a TV commercial except that it runs in the browser window and has similar branding power as a TV commercial. Unicast ads give the consumer the ability to click on the ad for more information. These ads are effective, with an average click-through rate of 5%.

Federal style

Similar to the Georgian except it has more ornamentation, dentil moldings, decorative garlands, Palladian-style windows, and fanlights.

Traverse windows

Slide from side to side and are found in Ranch and other modern style houses. Sliding glass doors are simply large, traverse windows.

Supplemental Statutory and Contractual Disclosures

Some brokers use this form in addition to the "Transfer Disclosure Statement". The form includes the following representations made by the seller, which are not representations of the agents. A. Has there been the death of an occupant of the property upon the property within the last three (3) years? B. Has an order been issued by a government health official stating that the property is contaminated by methamphetamine? C. Has there been the release of an illegal controlled substance on or beneath the property? D Is the property located in or adjacent to an "industrial use" area? E. Is the property located within one (1) mile of a former federal or state ordnance location? F. Is the property a condominium or located in a planned unit development or other common interest subdivision? G. Are there insurance claims affecting the property within the past five (5) years? H. Are there matters affecting title of the property? I. Are there any material facts or defects affecting the property not otherwise disclosed to the buyer? J. Are there any material facts or defects affecting the property not otherwise disclosed to the buyer?

Ranch style house

Sometimes called the California Ranch, has become the most popular style in the country. Because Ranch style houses are found throughout the United States in suburban tracts, some critics say they have "no style". However, this practical, informal, comfortable style obviously is popular with many Americans. Today, the eclectic Ranch style is influenced by other styles such as Tudor, Colonial, Mediterranean, and Bungalow. Ranch style houses are one-story, rambling, rectangular, L-shaped or U-shaped, with a low-pitch gable or hipped roof, attached garage, stucco, wood, or brick exterior walls, picture windows, and sliding doors leading to patios. Due to the horizontal nature of the style, these houses need wide lots.

Non-Conforming Loans

Sometimes either the borrower's creditworthiness or the size of the loan does not meet conventional lending standards; these loans are non-conforming loans and include jumbo and subprime loans.

Disclosures

Sometimes the seller will need to fill out and sign a standard form; other times the seller (or broker) may meet requirements by giving the buyer informational booklets. Sellers must disclose, in writing, any and all known facts that materially affect the value of their property whether the buyer asks or not. Even if a home is sold "as is", the seller must disclose any observable (patent) defects as well as any hidden (latent) defects. The term "as is" means that the seller is not going to fix any of the problems. In addition, you must also visually inspect the accessible parts of the home. If you notice something that could indicate a problem, you must let both the seller and any prospective buyer know. During the process of selling a home, the seller will need to prepare the "Transfer Disclosure Statement" (TDS) and "Natural Hazard Disclosure Statement" (NHD) as soon as possible. In addition, the seller will need to disclose if the property is subject to lead-based paint, military ordnance, commercial zone, or Mello-Roos tax. This disclosure information should be given to prospective buyers before they submit an offer. If they are provided to the buyer after acceptance of the offer, the buyer has three (3) days to terminate the offer. Remember, you cannot fill out these forms for the seller. Depending on the age and type of construction of the property, sellers can receive limited legal protection by providing buyers with booklets titled The Homeowners Guide to Earthquake Safety, The Commercial Property Owner's Guide to Earthquake Safety, Protect Your Family From Lead in Your Home, and Environmental Hazards: A Guide for Homeowners and Buyers. If the booklet on lead is to be supplied, disclosure of any known lead-based paint and its hazards must be made to the buyer on a separate form. Many buyers consider death on real property to be a material fact. However, the California Civil Code Section 1710.2 states that a seller has no disclosure duty "where a death has occurred more than three (3) years prior to the date that the transferee offers to purchase, lease, or rent the real property, or that an occupant of that property was afflicted with, or died from HIV/LAV." This information should also be indicated on the "Supplemental Statutory and Contractual Disclosures" form. If the property is a condominium, townhouse, or other property in a common interest subdivision, the seller must provide the buyer with copies of the governing documents, the most recent financial statements distributed, and other documents required by law or contract of the homeowners' association. This information should be affirmed on the "Homeowner Association Information Request" form.

C. Possible Dual Agency With Buyer

Sometimes, the listing broker finds the buyer. If that happens, the broker could act as a dual agent for both seller and buyer, but only with the written consent of both parties.

NAR Code of Ethics Standard of Practice 10-1 Article 12 Standard of Practice 12-1 Standard of Practice 12-2 Standard of Practice 12-3

Standard of Practice 10-1: When involved in the sale or lease of a residence, REALTORS® shall not volunteer information regarding the racial, religious or ethnic composition of any neighborhood nor shall they engage in any activity which may result in panic selling, however, REALTORS® may provide other demographic information. (Adopted 1/94, Amended 1/06) Article 12: REALTORS® shall be honest and truthful in their real estate communications and shall present a true picture in their advertising, marketing, and other representations. REALTORS® shall ensure that their status as real estate professionals is readily apparent in their advertising, marketing, and other representations, and that the recipients of all real estate communications are, or have been, notified that those communications are from a real estate professional. (Amended 1/08) Standard of Practice 12-1 REALTORS® may use the term "free" and similar terms in their advertising and in other representations if all terms governing availability of the offered service or product are clearly disclosed at the same time. (Amended 1/97) Standard of Practice 12-2 REALTORS® may represent their services as "free" or without cost even if they expect to receive compensation from a source other than their client if the potential for the REALTOR® to obtain a benefit from a third party is clearly disclosed at the same time. (Amended 1/97) Standard of Practice 12-3 The offering of premiums, prizes, merchandise discounts, or other inducements to list, sell, purchase, or lease is not, in itself, unethical even if receipt of the benefit is contingent on listing, selling, purchasing, or leasing through the REALTORS® making the offer. However, REALTORS® must exercise care and candor in any such advertising or other public or private representations so that any party interested in receiving or otherwise benefiting from the REALTOR®'s offer will have clear, thorough, advance understanding of all the terms and conditions of the offer. The offering of any inducements to do business is subject to the limitations and restrictions of state law and the ethical obligations established by any applicable Standard of Practice. (Amended 1/95)

Subprime Loans

Subprime loans were developed to help higher risk borrowers obtain a mortgage. Loans that do not meet the borrower credit requirements of Fannie Mae and Freddie Mac are called subprime loans or "B" and "C" paper loans as opposed to "A" paper conforming loans. Subprime loans are offered to borrowers who may have recently filed for bankruptcy or foreclosure, or have had late payments on their credit reports. The purpose of these loans is to offer temporary financing to applicants until they can qualify for conforming "A" financing. Due to the higher risk associated with lending to borrowers who have a poor credit history, subprime loans typically require a larger down payment and a higher interest rate.

Sidelights

Tall, narrow windows flanking the entry door. These windows are characteristic of Greek Revival, and are found in Neo-Eclectic houses.

Telemarketing

Telemarketing is a form of direct marketing that uses the telephone to reach potential customers. It is a useful way to contact potential sellers. You must call people to let them know you are in the real estate business. Although they may not be ready to buy or sell, they may give you a referral for someone who is ready. People are more likely to refer their friends and associates who are thinking about buying or selling if your name is fresh in their minds. Two types of telephone prospecting are warms calls and cold calls. Warm calls are to people you already know and cold calls are to people you do not know.

Seller's Advisory

The "Seller's Advisory" form alerts sellers to the various disclosures they need to make regarding the condition of their home and its surroundings. The advisory explains the obligation to follow state and federal tax laws, comply with retrofit standards (if not exempt), and follow state and federal fair housing laws. The advisory also helps a seller with ideas about how to market his or her property effectively.

Anti-SPAM

The CAN-SPAM Act of 2003 (Controlling the Assault of Non-Solicited Pornography and Marketing Act) establishes requirements for those who send commercial email. It also gives consumers the right to ask emailers to stop sending them emails. The Act pertains to commercial email messages. A commercial email message is "any electronic mail message with the primary purpose of which is the commercial advertisement or promotion of a commercial product or service." Emails sent as part of an ongoing commercial transaction, called transactional email messages, are exempt from the Act.

California Bungalow

The California Bungalow has a low profile, with one to one-and-one-half stories, a square shape, with a low-slung gable or hip roof, an offset entry with a wide front porch, and exterior walls finished with stucco and natural stone. These smaller, affordable bungalows were very popular between 1900 and the mid-1920s. Currently, this look is incorporated into modern houses.

California Veteran Loans (CalVet)

The California Department of Veterans Affairs (CA DVA) administers the CalVet loan program to assist California veterans in buying a home or farm. Unlike other government financing, the CalVet program funds and services its own loans through the sale of State General Obligation Bonds. The CA DVA sells bonds to purchase homes and then sells the homes to qualified California veterans using a land sale contract. An eligible California veteran applies for the loan and makes loan payments directly to the Department of Veterans Affairs. Upon application for a CalVet loan and approval of the borrower and property, the Department of Veterans Affairs purchases the property from the seller, takes title to the property, and sells it to the veteran on a contract of sale. The department holds legal title, with the veteran holding equitable title, until the loan is paid off. The veteran has an obligation to apply for life insurance, with the Department of Veterans Affairs as beneficiary, to pay off the debt in case of the veteran's death.

Combined Hazards Book

The Combined Hazards Book is comprised of three parts: (1) Residential Environmental Hazards, (2) Protect Your Family From Lead booklet, and (3) The Homeowner's Guide to Earthquake Safety. By giving the buyer this Combined Hazards Book, you will meet or exceed current disclosure requirements. Remember, even though you give buyers the disclosure booklets, the seller is still responsible to complete all disclosure forms honestly and accurately.

VA Loan

The Department of Veterans Affairs (DVA) does not make loans. It guarantees loans made by an approved institutional lender, much like the FHA. Both programs were created to assist people in buying homes when conventional loan programs did not fit their needs. The main differences between the two government programs are (1) only an eligible veteran may obtain a VA loan and (2) the DVA does not require a down payment up to a certain loan amount, which means qualified veterans could get 100% financing. As with FHA loans, there are no alienation or prepayment penalty clauses allowed with VA loans. VA loans are made by a lender, such as a mortgage company, savings and loan, or bank. The DVA's guaranty on the loan protects the lender against loss if the payments are not made, and is intended to encourage lenders to offer veterans loans with more favorable terms.

Section 203(b)

The FHA 203(b) loan offers financing on the purchase or construction of owner-occupied residences of one to four units. This program offers 30-year, fixed-rate, fully amortized mortgages with a down payment requirement as low as 3.5%, allowing financing of up to 96.5% of the value of the home.

Federal Housing Administration (FHA)

The Federal Housing Administration (FHA) does not make loans; it insures lenders against loss. Loans are made by authorized lending institutions such as banks, savings banks, and independent mortgage companies. The borrower applies directly to the FHA-approved lender (mortgagee), not the FHA, for a loan. The lender is protected, in case of foreclosure, by charging the borrower a fee for an insurance policy called Mutual Mortgage Insurance (MMI). The insurance requirement is how the FHA finances its program. The premium may be financed as part of the loan or paid in cash at the close of escrow.

Seller's Affidavit of Nonforeign Status and/or California Withholding Exemption

The Internal Revenue Code provides that a buyer (transferor) of a U.S. real property interest must withhold tax if the seller (transferee) is a "foreign person". Completion of sections 1, 2, 3, 4, and 5 are required by law and the entire affidavit may be disclosed to the IRS and the California Franchise Tax Board by the seller. Any false statements made within the form may result in a fine, imprisonment, or both. Both the seller and buyer must sign and date this affidavit, and the buyer must receive a signed copy of the form.

Do Not Fax

The Telephone Consumer Protection Act of 1991 (TCPA) created the rules and regulations regarding unsolicited faxes. The TCPA prohibits the sending of faxes containing unsolicited advertisements. Unsolicited advertisements are defined as any material advertising the commercial availability or quality of any property, goods, or services that is transmitted to any person without that person's prior express invitation or permission. The penalties for violating the TCPA are $500 per fax with treble damages for willful violations.

Folk Victorian style

The affordable version of the Queen Anne house. They are asymmetrical, rectangular, or L-shaped, with white wood siding, steep gabled roofs, and a front porch with turned spindles. They are adorned with flat jigsaw cut trim in a variety of shapes and patterns. These practical houses are found in small towns and farms across the United States. Today, the farmhouse style is characterized by a rectangular or boxy, two-story shape with a steep gabled or cross-gabled roof. Most have siding, shutters, and the distinctive wraparound porch with turned spindles, jigsaw cut trim, and brackets under the eaves.

Alienation Clause

The alienation or due-on-sale clause is a type of acceleration clause. A lender may call the entire note due if the original borrower transfers (alienates) ownership of the property to someone else. If the note contains an acceleration clause, the trust deed must mention this clause in order to enforce the contract. This clause protects the lender from an unqualified, unapproved buyer taking over a loan. Justifiably, the lender fears possible default, with no control over who is making the payments.

Seller Financing: All-Inclusive Trust Deed (AITD)

The all-inclusive trust deed (AITD), or wrap-around mortgage, is a type of seller financing. It is used in a transaction between buyer and seller to make the financing attractive to the buyer and beneficial to the seller as well. Instead of the buyer assuming an existing loan and the seller carrying back a second trust deed, the AITD can accomplish the same purpose with greater benefit to both parties. At the closing, the buyer receives title to the property. An AITD (wrap-around mortgage) wraps an existing loan with a new loan, and the borrower makes one payment for both. In other words, the new trust deed (the AITD) includes the present encumbrances, such as first, second, third, or more trust deeds, plus the amount to be financed by the seller. Under an AITD, the buyer makes one large payment. The recipient of the payment, usually either the seller or a servicer that the seller designates, splits the payment up. Part of it goes to the lender on the original mortgage, and the rest goes back to the seller as the payment on his second mortgage.

What is Necessary for a Valid Escrow?

The basic requirements for a valid escrow include (1) a binding purchase agreement contract made between the parties, (2) conditional delivery of funds, and (3) conditional delivery of transfer documents. The most important item needed for a valid contract is a binding purchase contract between the buyer and seller. Conditional delivery of funds means the buyers and/or the lender will deliver to escrow whatever funds are required to complete the sale. Sometime before the escrow closes, the sellers will sign a grant deed conveying title to the buyers. In a grant deed, the grantor warrants that he or she has not previously conveyed the property being granted, has not encumbered the property except as disclosed, and will convey to the grantee any title to the property acquired later. Because the sellers will sign over ownership to the buyers before getting the money, the escrow holder must hold the signed deed until funds from the buyers are deposited in escrow and all other terms of the escrow have been met. At this time, the sellers have made conditional delivery of the grant deed.

4. Compensation to Broker

The bold-faced type is a notice regarding commission. It states that the amount of commission a broker receives is not set by law and is negotiable. A. The dollar amount or percentage rate of commission that will be paid if the property is sold is indicated here. þ 6% (six percent) of the listing price (1) Regardless of who produces a potential buyer, a commission is due. The purchase offer must either meet the price and terms of the agreement (see Paragraph 2) or include a different price and terms that are acceptable to the seller. The offer must also be made during the listing period (see Paragraph 1). OR (2) This is the safety clause that protects the listing broker's commission. It states that if the owner personally sells the property to someone who had previously been shown the property or made an offer during the term of the listing the broker still receives a commission. When the listing is signed, the seller and broker need to agree on a length of time for the protection period. The protection clause applies only if the broker has given the seller a list containing the names of the "protected" buyers within three (3) calendar days of expiration of the listing. This prevents the seller from waiting for a listing to end before accepting an offer and then refusing to pay a commission to the original broker. 30 (thirty) calendar days OR (3) The seller agrees to pay a commission if the seller sells, leases, or rents the property; withdraws it from the market without the broker's consent; or renders the property otherwise unavailable for sale before the expiration date. B. If the sale is unable to be completed because of a party other than the seller, and damages are collected, then the total commission is to be the lesser of the commission due under Paragraph 4A, or one-half of the damages recovered after expenses are deducted. C. Additional seller compensation, such as other broker expenses or MLS, is provided for here. Many brokerage firms charge sellers a fee for document preparation or transactions. Additional charges to the seller should be made clear in the listing contract. In addition, the seller agrees to pay the listing broker an additional one (1) percent commission if, within thirty (30) days of the listing date, an offer is brought meeting the exact terms of the listing agreement and escrow closes. D. The broker advises the seller of the broker's policy regarding cooperating with and sharing compensation with other brokers. (1) If the seller authorizes the broker to cooperate with and compensate brokers through the multiple listing service (MLS), check either box to show the percentage or dollar amount to be paid. Notice that the amount is based on the purchase price, not the listing price. þ 3% (three percent) of the purchase price(2) The broker may cooperate and divide commission with brokers operating inside or outside the MLS. E. The seller irrevocably assigns the broker his or her compensation from the seller's proceeds. This assignment agreement protects the broker's fee. Prior to this agreement, it was possible for the seller to notify an escrow not to pay the broker, but to turn the funds over to the seller instead. F. The next three clauses protect the broker's commission. Since the broker will expend time, effort, and money in marketing the property, they want to be sure they will be paid for their successful efforts. (1) If the home had been listed before, enter that information here. (2) The owner is not required to pay anyone a commission, other than the broker, if the property is sold during the listing period (with the exception of listed prospective buyers). (3) If a listed buyer purchases the property when the Seller is still obligated to pay another broker, the new listing Broker is not entitled to a commission and is not obligated to represent the Seller in the transaction.

7. Broker's and Seller's Duties

The broker agrees to use diligence in achieving the purpose of the listing agreement. This is particularly important in an exclusive agency agreement because the seller is allowing one broker to market the property to the exclusion of other brokers. There are many cases where the seller sues for breach of contract because the listing broker did not actively advertise or use reasonable effort when marketing the property. Assuming the listing broker has done his or her part, the seller agrees to make the property available for showing. In addition, the seller agrees to consider offers received in good faith and to hold the broker harmless for claims resulting from incorrect information supplied or the failure to disclose information to the broker.

18. Selection of Service Providers

The broker does not guarantee the performance of any service providers. Buyers and sellers may select any company to provide escrow, title, inspection, finance, and certification services.

19. Multiple Listing Service (MLS)

The broker has the right to report the sale terms to an MLS service to be published. The release of this information by an agent, without such authorization, could breach the duty of confidentiality.

Cooperating broker or selling agent

The broker obtaining an offer is often called the cooperating broker or selling agent. A selling agent is the broker who finds a buyer and obtains an offer for the real property. Depending on the agency relationship, the selling agent may represent the seller, the buyer, or both.

Hazard Insurance

The buyer and seller will have agreed on hazard insurance and will instruct the escrow officer accordingly. Hazard insurance protects the borrower and the lender against loss due to fire, windstorm, vandalism, and other hazards. The escrow holder will accept, hold, and deliver any policies and will follow instructions about transferring them. A lender will require hazard insurance to cover the outstanding loan on the property and will expect the escrow holder and the buyers to be accountable for either a new policy or the transfer of an existing one. Some costs and expenses are allocated (assigned) to the buyer or seller in escrow. Typical costs that are allocated include escrow fees, title costs, inspection reports, home warranty fees, transfer tax, and retrofit costs.

Buyer's Statement

The buyers' statement is a record of costs and credits incurred for the purchase of the property. Buyer's Credits Down payment Amount of new loan Prorated taxes Prorated rents Security deposits held by sellers Buyer's Debits for Non-Recurring Costs Title insurance (buyers' share) Escrow fee (buyer's share) Legal fees Loan application fee Underwriting fee Courier fee Verification fee Warehousing fee Loan fee Appraisal fee Tax service Credit report Notary fee Recording fees Pest control inspection (according to agreement with sellers) Document preparation fee Review fee Buyer's Debits for Recurring Costs Hazard insurance Trust fund or impound account Prorated taxes (if prepaid by sellers beyond recordation) Prorated interest (if charged in arrears)

Warm prospects

The contact list should include everyone you know—family members, friends, teachers, former colleagues, and members of associations to which you belong. They are in your sphere of influence and are considered warm prospects.

Contract of Sale

The contract of sale is the financing instrument with many names. It may be called an installment sales contract, an agreement of sale, a conditional sales contract, a contract for deed, or a land sales contract. Within this contract, the seller (vendor) becomes the lender to the buyer (vendee). The vendor pays off the original financing while receiving payments from the vendee on the contract of sale. The vendor and vendee's relationship is like that of a beneficiary and a trustor in a trust deed.

Target market

The defined group of properties or individuals with similarities. Your target market can be broad as in geographic markets or highly focused as in a niche market.

Advertising media

The different channels available to convey a message to a target market. The major media channels are the Internet, print media, outdoor media, radio, and television (network, cable, and syndicated).

Sales comparison approach

The easiest approach to apply. This approach is best for single-family homes or condominiums and vacant lots because sales information is readily available and easily compared. The sales comparison approach uses the principle of substitution to compare similar properties by looking at the current selling price of a similar property and adjusting it for any differences to determine the market value for the subject property.

Receives and Holds All Funds

The escrow coordinates the receipt and disbursement of all funds, whether from the buyer or a lender. In addition, the escrow holder coordinates the payoff or assumption of the seller's existing loans on the property, as well as any new loans the buyer is arranging for the purchase of the property.

Escrow Holder Acknowledgement

The escrow holder acknowledges receipt of the agreement and agrees to act as escrow holder.

Prepares and Records Deeds

The escrow holder prepares the grant deed and sends it to the seller. The seller needs to sign the grant deed in front of a notary public and return it to escrow before the closing date. At close, the escrow holder records the deed and other documents.

Seller's Loans

The escrow officer must verify any existing loans on the subject property. If proceeds from the sale will pay off existing loans, the escrow officer requests a payoff demand from the lender holding the note and trust deed. The payoff demand shows the unpaid principal balance, the daily interest rate, and any other amounts due. The lender must disclose the exact amount of the loan payoff so the escrow officer's accounting will be correct at the closing. If an existing loan is going to be assumed, or taken subject to, a beneficiary statement that sets forth the unpaid balance of the loan amount and the condition of the debt is requested from the lender by the escrow holder.

Extended coverage policy of title insurance

The extended coverage policy of title insurance covers everything that a standard policy covers, plus other unrecorded hazards, such as outstanding mechanic's liens, unrecorded physical easements, facts a properly conducted survey would show, certain water claims, and rights of parties in possession—including tenants and owners under unrecorded deeds. The American Land Title Association offers an owner extended coverage policy known as ALTA Owner's Policy that includes the same coverage as a standard policy, with the following additions: (1) protection against claims of parties in physical possession of the property but no recorded interest, (2) reservations in patents, and (3) unmarketability of title.

Closes Escrow

The final responsibility of the escrow holder is to close escrow. Escrow cannot close until all financial and legal items have been completed. A refinance and the purchase of a property that includes financing will require a financial closing. Steps must be taken in the financial closing to ensure that funds are distributed appropriately. The escrow officer follows instructions regarding financing the property, and prepares any documents necessary to close escrow. These might be a note and trust deed, or assumption papers. In the purchase of property, there is a transfer of ownership from the sellers to the buyers, which involves a legal closing. Care must be taken to ensure a legal transfer of ownership. The escrow holder orders the title company to record all transactional documents as instructed by the sellers and buyers. Documents that may require recording include the grant deed, trust deed, contract of sale, or option. Recording occurs after a final check of the title company records to be sure nothing has changed since the preliminary title search. Then the title company issues a policy of title insurance to insure the buyers' title. Upon closing, the escrow officer delivers all documents to the proper parties, disburses all monies, and gives closing statements to sellers and buyers. The sellers get a check for the proceeds of the sale minus escrow fees, real estate commissions, or any other costs of selling, and any pertinent documents; and the buyers get a grant deed. The original deed is mailed directly to the buyers at the new property by the county recorder's office. This usually takes several weeks, sometimes longer.

Opening Escrow

The first step in the closing process is to open escrow. This usually is done by the listing salesperson, who gives the escrow officer the signed purchase agreement along with the buyers' good faith deposit. The escrow officer needs to make sure the contract is complete, fully signed, and initialed by all parties before accepting it.

Title Insurance Policy

The goal of title insurance companies is to insure the clear, marketable title of property. A marketable title would be accepted as clear and free from likely challenges-reasonably free from risk of litigation over possible defects. Title insurance protects real estate owners from challenges to their property titles. It protects against loss due to errors in searching records and in reporting the status of title and guarantees that the property is free of liens. In addition, title insurance protects the lender against loss or damage due to defects in the property's title, and the buyer from unpredictable factors such as human error or forgery. The main benefit is that it extends protection against matters of record and many non-recorded types of risks, depending on the type of policy purchased.

Market value

The highest price a property would bring if freely offered on the open market, with both a willing buyer and a willing seller.

8. Deposit

The listing agent is authorized, on behalf of the seller, to accept and hold any deposits that will be applied toward the purchase price. Sometimes, the seller does not authorize the broker to accept deposits on his or her behalf. If the listing broker accepts a deposit without the seller's authorization, then the broker is responsible to the buyer for the deposit.

The Listing

The listing agent must provide the following documents upon taking a listing. The type of listing agreed upon by the listing agent and seller will dictate which listing agreement to use.

Real Estate Brokers Section

The listing and selling brokers acknowledge they are not parties to the agreement. The selling broker signs to confirm the agency relationship and receipt of a deposit. The listing broker signs to confirm the agency relationship and agrees to pay the selling broker pursuant to the MLS offer of compensation (if the selling broker is a participant of that MLS or a reciprocal MLS) or pursuant to a separate written agreement.

Presentation and Rejection of Offer

The listing broker confirms that the offer was presented to the seller on the specific date indicated. If applicable, the seller will confirm that he or she rejected the offer on the specific date indicated.

6. Seller Representations

The listing broker would not want to waste time and money advertising a property that is subject to a lawsuit, foreclosure, or anything that would not allow the seller to complete the sale. This clause affirms that the seller is unaware of a notice of default recorded against the property; delinquencies due under loans; bankruptcy, insolvency, or other proceedings affecting the property as well as any litigation pending or threatened that could affect the seller's ability to sell. If the seller becomes aware of any of the above during the listing, the seller agrees to notify the agent immediately.

Listing price

The listing price is the amount of money a seller agrees to accept from a buyer. It is stated in the listing agreement but may be negotiable during the listing period.

No Agency Relationship

The majority of buyers work with a salesperson (sometimes several) without the benefit of a legally binding agency relationship. Many buyers prefer this approach because it allows them to shop around for a salesperson. The buyers will settle for the agent who finds them a property to purchase. This arrangement does not require the buyer to sign an exclusive contract, nor does it require any loyalty on the part of the buyer to any agent. In this case, the broker or sales associate must have the buyer sign a written agency disclosure statement before writing the offer to purchase.

Electronic underwriting systems

The mortgage industry uses electronic underwriting systems that predict multiple-risk factors in a loan application. The most widely used automated underwriting systems are Fannie Mae's Desktop Underwriter and Freddie Mac's Loan Prospector. Fannie Mae offers its lenders electronic loan processing with its Desktop Underwriter system. Users receive an analysis of the borrower's credit, estimate of the property's value, and an opinion of the risk involved. This information is prepared from the data submitted on the loan application and is available in a matter of minutes. The use of a common automated underwriting standard will simplify the electronic mortgage application process and reduce its cost.

Accepts Documents and Inspection Reports

The parties to an escrow may request reports regarding the condition of the property. Therefore, the escrow holder accepts and holds reports such as the structural pest control report (termite report), property inspection report, soil condition report, or environmental report. The reports are given to the person who needs to approve them and remove any contingency. Then the escrow holder accepts those approvals that remove contingencies from the buyers on title insurance, pest control reports, and other inspections.

Art Moderne style

The precursor of future house design, displaying extreme simplicity. It has a horizontal, cube-like shape with a flat roof and rounded corners. The exterior walls are smooth stucco with rounded corners. Casement windows are evenly spaced. Other than the use of glass brick, there is little or no ornamentation. Window and door trim and balustrades are made from polished aluminum and stainless steel.

Preliminary Report

The preliminary report (prelim) is prepared to verify the legal ownership of the property. This report indicates whether the seller currently holds title to the property and includes a list of the previous owners, purchase dates, and sale dates to make sure the chain of title is correct. The chain of title is the public record of prior transfers and encumbrances affecting the title of a parcel of land. If there is a missing connection in a property's history or ownership, or if a deed was recorded in error or is incomplete, it clouds the title. The prelim also lists any liens or claims against the property such as property taxes, income taxes, mortgage payments, or other unpaid debts. Any problems that arise should be corrected during the escrow period so the title is clear for the new owner. The buyers have a certain number of days to approve this preliminary report. Buyers' approval is important to eliminate surprises regarding the title as the escrow progresses. The escrow holder should prepare an addendum that notifies the sellers and buyers if there is any difference in the preliminary report and the escrow instructions. If the sellers cannot provide clean title and eliminate certain exceptions prior to closing, the buyers have the right to accept or reject the prelim and back out of the transaction. Some of these exceptions include easements, liens, and encumbrances.

Selling price

The price a buyer actually pays for a property that may or may not be the same as the listing price.

10. Security and Insurance

The property will only be shown to prospects in the presence of listing and cooperating brokers (or their sales associates). Listing brokers are not responsible for damage to or loss of personal property, even if a lockbox is present. Valuables should be locked up or removed from the premises and the seller must obtain insurance to protect against these risks.

4. Allocation of Costs

The purchase of a property requires many inspections, reports, and tests; the cost of which must be allocated between buyer and seller. Allocate means to assign. Also, the buyer and seller must agree on allocation of payment for the escrow and title providers they select. Check the appropriate box(es). A. (1) - (6) Inspections and Reports The parties identify who is responsible to pay for an inspection for wood destroying pests and which company should prepare the report. This section also identifies which party will pay for specified inspection reports, such as disposal systems, domestic wells, flood and fire zones, earthquake fault, seismic, etc. B. (1) & (2) Government Requirements and Retrofit The parties negotiate who will pay for smoke detector installation compliance, water heater bracing, and any other retrofits that may be required. C. (1) & (2) Escrow and Title The parties decide who will pay for the title policy and escrow fees, as well as who will provide those services. The seller must pay the entire escrow fee for VA transactions. D. (1) - (8) Other Costs The parties decide who will pay the fees for the enumerated costs as well as any other cost items.

Conversion ratio

The ratio of actions taken to the number of total visitors is called the conversion ratio. The higher the conversion ratio, the greater the effectiveness of your site.

Due diligence

The reasonable effort to provide accurate and complete information about a property.

French Normandy style

The round stone tower topped with a cone-shaped roof. Sometimes the tower is the entrance to the house. In addition, vertical half-timbering (reminiscent of Tudor style) adds height to the house. Unlike a Tudor, French Normandy houses have hip roofs, not cross-gabled roofs. The houses use stone, stucco, or brick as siding.

Signatures

The seller acknowledges that he or she has read, understands, and accepts the agreement. The seller acknowledges receipt of a copy of the agreement as well. There are lines for seller's and broker's signature, address, and telephone number. Remember to give a copy of the listing agreement to the seller at the time of signing.

13. Sign

The seller needs to authorize the agent to place a "For Sale" or "Sold" sign on the property. The seller checks the box only if he or she does not want a sign. Be sure to find out about and follow any signage rules for condominium developments, gated communities, or master-planned communities.

21. Ownership, Title, and Authority

The seller(s) are usually on title to the property and have the authority to sign the listing agreement and sell the property. The person selling the property could be different from the sellers. An example would be an attorney-in-fact who is authorized to list and sell a property on behalf of the owners. It's a good idea to ask the sellers to get out their grant deed because it shows who holds title (vesting) and how it was taken. Remember, either a husband or wife may list community property, but both must actually sign the purchase offer.

23. Broker Compensation

The seller, buyer, or both agree to compensate the broker, which is specified in a separate, written agreement. The compensation will be paid at the close of escrow. If escrow does not close, the broker is paid according to the terms of a separate, written agreement with the seller or buyer.

Seller's Statement

The sellers' statement is a record of the financial proceeds the sellers will receive upon the transaction's closing. Seller's Credit Amount of the total consideration, or sales price, debit the buyers. Any property taxes paid, debit the buyers. Monthly homeowners' association dues, debit the buyers. Interest on loan if paid in advance (from recordation to date of next loan payment). Seller's Debits Loan payoff on existing loan plus any interest charges Selling commission Title insurance including title policy premium, reconveyance fee, and documentary transfer tax Recording fee (reconveyance) Escrow fee (seller's share) Legal fees Prepayment penalty State or local transfer tax Pest control inspection fee Pest control work Recording fee FHA or VA points Termite report = Seller's Proceeds

Standard policy of title insurance

The standard policy of title insurance issued to homebuyers only covers matters of record. No physical inspection of the property is required and the buyers obtain protection against all recorded matters, and certain risks such as forgery and incompetence. The title company does not do a survey or check boundary lines when preparing a standard title insurance policy.

Disclosure Process

The steps in the disclosure process are: disclose, elect, and confirm.

Santa Fe style

The thick, earth-colored adobe walls and flat roofs with rounded parapets of the Santa Fe style make these houses look chunky, but they are suitable for hot, dry climates. Because of the thickness of the walls, the windows and heavy wooden doors are set into deep openings. Sometimes red clay tile accents on the roof and enclosed patios add a Spanish influence. Another version of the Santa Fe is the Pueblo Revival style. This style is characterized by roof beams, called vigas, which protrude through the walls and help support the roof.

12. Title and Vesting

The title and vesting is used for reviewing the preliminary title report with the buyer. Check for any undisclosed liens or easements that may affect the use of the property. Since the property is still owned by the seller, any existing trust deeds will be shown with the seller as the trustor. Once the property is sold, the new title insurance policy will show the buyer's loan. The manner in which a buyer takes title to real property (vesting) can have unforeseen legal and tax ramifications. Always direct the buyer to a legal and tax professional to get advice on vesting. A. The buyer has a specified amount of time to review the preliminary report and give the seller a notice in writing to take corrective action. B. All matters on the title, including easements and CC&Rs, will remain on the title unless otherwise indicated by the buyer in writing. C. The seller must disclose all known title matters to the buyer, even those not recorded. D. The title will be transferred by a grant deed at the close of escrow. An agent should never advise how to take title. E. The buyer will receive a CLTA/ALTA Homeowner's Policy of Title Insurance.

USonian

They cost much less to build because they had no basements or attics and very little ornamentation. USonian style houses were built from the Depression until the mid 1950s. They became the model for early tract housing.

18. Successors and Assigns

This agreement shall be binding upon the seller and seller's successors and assigns. This would not apply in the event of death or incapacity of either the principal or broker, because the agency relationship is a personal one between the principal and agent, and would terminate upon death or incapacity.

Homeowner Association Information Request

This form is used when purchasing types of common interest developments (condominium, community apartment projects stock cooperative, or planned development). Information required on this form should be obtained from the specified homeowner association. The seller should also acknowledge that he or she has read, understands, and has received a copy of this request.

7. Prorations and Property Taxes and Other Items

This informs escrow of the buyer's and seller's wishes regarding the proration of property tax, interest, assessments, and any other charge normally prorated in escrow. To prorate means to divide or distribute proportionately. As of the close of escrow, prorated items should be paid current by the seller or assumed by the buyer.

9. Agency Relationships

This is another reminder that you must disclose your agency relationship to the seller prior to signing this listing agreement, if the property is a residential property of one-to-four units.

Debt-to-income ratios

This is simply the percentage of a borrower's monthly gross income (before taxes) that the borrower uses to pay monthly debts. Because there are two calculations, there is a "front" ratio and a "back" ratio. This ratio generally follows this format: 28/36. The front ratio is the percentage of the borrowers' monthly gross income (before taxes) that is used to pay housing costs, including principal, interest, taxes, insurance, mortgage insurance (when applicable) and homeowners association fees (when applicable). The back ratio is the same thing, but it also includes the borrowers' monthly borrower debt. Borrower debt includes car payments, credit card debt, installment loans, and similar expenses. Auto or life insurance is not taken into consideration as part of the borrowers' debt. Borrowers' housing costs should consume no more than 28% of their monthly income. The borrowers' monthly debt and housing costs added together should take no more than 36% of the monthly income.

27. Terms and Conditions of Offer

This paragraph provides that the purchase agreement is an offer to purchase property on the terms and conditions set forth in the agreement. The offer will be revoked after the specified expiration date. The buyer, however, may revoke the offer any time prior to communication of seller's acceptance.

16. Final Verification of Condition

This paragraph provides the buyer the right to conduct the final inspection, or "walk-through", five days or a number specified, prior to close of escrow. This allows the buyer to verify the condition of the property as agreed upon, and that the seller has complied with repair and other contractual obligations.

21. Attorney Fees

This paragraph relates to disputes between the buyer and seller only. The prevailing party is entitled to reasonable attorney's fees from the non-prevailing party in any court action or arbitration. If the parties decide to settle a dispute, attorney's fees may be one of the terms negotiated in the settlement.

15. Repairs

This paragraph requires that any repairs must be done with permits and in compliance with building codes. Repairs must be completed before the buyer's final verification of the condition of the property. The seller must obtain repair receipts, prepare a written statement of the repairs performed, and give them to the buyer.

3. Finance Terms

This section addresses the financing for the sale—whether the purchase will be an all cash offer or an offer based on obtaining financing. If the buyer must obtain financing to complete the transaction, the finance terms should state if the purchase of the property is contingent upon the buyer's ability to get financing. The amounts of the initial deposit, any increased deposit, and the loans are listed and added to total the amount of the purchase price. Remember, any earnest money or deposits received by an agent are trust funds and handled as prescribed by the Commissioner's Real Estate Law and Regulations. A. Initial Deposit The initial deposit is given directly to the escrow holder or to the agent submitting the offer. This is usually the buyer's agent, but may be a seller's exclusive agent or dual agent if it is an in-house sale. Funds received may not be commingled with a broker's personal funds. Funds must be deposited and disposed of within three business days after receipt unless otherwise instructed in writing. Indicate if the deposit will be placed into a broker's trust account or elsewhere. Write the amount in the right-hand column. In some offices, it is a standard practice to write out the amount of the deposit on the dotted line that precedes the space in the right-hand column. Five Thousand Dollars and Zero Cents ($5,000.00) B. Increased Deposit Choose the amount of deposit and the number of days after acceptance that it will be paid. In order for the increased deposit to be included in the amount of liquidated damages, a separate receipt for the increased deposit must be included at the time it is paid. Write the amount of the increased deposit in the right-hand column. In our case study, the Winters will increase the deposit to $41,500. Because their initial deposit was $5,000, they need to deposit an additional $36,500 to equal the $41,500. = $36,500.00 C. Loans This paragraph refers to the loans that will be used to finance the purchase. (1) If the first loan will not use conventional financing, indicate whether it is FHA/VA, seller financing, assumed financing, or other financing. Write the amount of the first loan on the line provided in the right-hand column. Then fill in the terms of the loan. Terms should be specific, not general or open to future interpretation. Fill in only the type of rate the buyer chooses (fixed or adjustable). $332,000.00 (on an 80/20 loan) 5.75% maximum interest rate 30 year term Points not to exceed two (2) percent of loan amount (2) If the buyer is using a second loan to finance the purchase, this section will contain the terms of the second loan. Just like the instructions for the first loan, indicate the type of financing and write the amount of the loan on the line provided in the right-hand column. Fill in the specific terms of the loan and the type of rate the buyer chooses (fixed or adjustable). Write the second loan terms in the space provided. N/A (3) If the first or second loan is a FHA or VA loan, the buyer has at least 17 days after the acceptance to deliver to the seller any written notices of lender-required repairs or costs that the buyer wants the seller to cover. These requirements do not have to be met unless the seller agrees to them in writing. D. Additional Financing Terms This paragraph refers only to any additional terms that relate to financing. Write the additional financing terms in the space provided. N/A E. Balance of Purchase Price or Down Payment The balance of the purchase price is deposited with the escrow holder within sufficient time to close. Write the amount out in numbers in the right-hand column. (Forty-One Thousand Five Hundred Dollars and Zero Cents) $41,500.00 F. Total Purchase Price Add sections 3A - E from the right-hand column and total. Be sure the total is correct. Write the total amount in the right-hand column. In some offices, it is a standard practice to write out the amount of the deposit on the dotted line that precedes the space in the right-hand column. (Four Hundred Fifteen Thousand Dollars and Zero Cents) $415,000.00 G. Verification of Down Payment and Closing Costs This paragraph requires the buyer to verify that he or she is able to pay the down payment and closing costs within seven days after acceptance, or the number of days inserted on the blank line. H. Loan Terms This paragraph outlines the loan requirements and contingencies for the purchase. (1) Loan Applications The buyer must provide a letter from a lender verifying that he or she is prequalified or preapproved for a loan. This must be done within seven days after acceptance, or the number of days inserted on the blank line. (2) Loan Contingency The buyer is required to exercise due diligence and act in good faith when obtaining a loan. The deposit, balance of the down payment, and closing costs are not contingencies in the purchase agreement. (3) Loan Contingency Removal This requires either the removal of the loan contingency or it specifies that the loan contingency will remain effective until the loan is funded. (4) No Loan Contingency This contingency is optional. If checked, it indicates that the offer is not contingent upon obtaining financing. I. Appraisal Contingency and Removal The buyer is not obligated to purchase the property if it appraises at less than the purchase price in paragraph 3F, even if a lender is willing to lend the amount specified in paragraph 3C. The buyer is able to check a box and opt out of this contingency. J. All Cash Offer The buyer indicates that the purchase will be all cash, with no loan, by checking this paragraph. K. Buyer Stated Financing This states that the seller is relying on the information provided by the buyer regarding the financing for the purchase. If the buyer wishes to pursue alternate financing, the seller does not have to cooperate with the buyer's efforts. In addition, the buyer must continue to adhere to the financing methods specified in the purchase agreement. If unable to obtain alternative financing, the buyer is not relieved of the obligation to purchase the property.

5. Closing and Possession

This section covers the intent of the buyer to occupy the property as a primary residence, the date the seller (or tenant) will turn over possession of the property to the buyer, and whether the buyer is allowed to take possession of the property prior to close of escrow. Sometimes a buyer wants early possession of the property, or the seller wishes to remain in possession after the close of escrow. In order to protect the rights of both seller and buyer, use an Interim Occupancy Agreement. A. Buyer Occupancy This paragraph states whether the buyer intends to occupy the premises. This is important because of matters such as liquidated damages, loan qualifications, rates, and terms. Check the appropriate box. B. Seller-Occupied or Vacant Property This paragraph provides the date and time when the property will be turned over to the buyer. If the buyer moves in early or the seller remains in the property, then the parties should enter into a written agreement to document that separate legal relationship. Occupancy is to be delivered to the buyer at the time specified on the close of escrow, or another specified date. Legal advisors and insurance companies should also be consulted. C. Tenant-Occupied Property Unless agreed otherwise, the tenant-occupied property must be vacant prior to the close of escrow. If this is not possible, the buyer and seller may check the following options: (i) Property shall be vacant at least 5 or [] _____ days prior to Close of Escrow, OR (ii) Tenant to remain in possession: (C.A.R. Form PAA) should be used, and paragraph 3 checked. D. Warranties The seller provides the buyer with any assignable warranty rights and documentation. Third party warranties are automatically assigned by the contract on close of escrow. The broker does not determine the warranties to be assigned. E. Keys At time of possession, the seller must deliver keys and means of opening all locks.

19. Dispute Resolution

This section explains two methods for resolving any misunderstandings that may arise regarding compensation under the listing agreement—mediation and arbitration. A. Mediation In mediation, a neutral third party (mediator) helps parties resolve a dispute. The mediator may not impose a settlement on either party. This clause states that the broker and seller agree to the mediation process. However, the broker and seller are not required to resolve the dispute through mediation. B. Arbitration of Disputes In arbitration, the parties hire a neutral person (arbitrator) to listen to each side of the dispute. A difference between mediation and arbitration is that the arbitrator may award a binding decision on all parties to the dispute. The decision is final, binding, and legally enforceable. An arbitration award can be challenged in court if the arbitrator was corrupt, exceeded his or her power, or the award was procured by fraud, corruption, or other undue means. Do not tell the sellers how to handle this clause. They need to read the clause, and if they are confused, tell them to consult their legal advisor. (1) By initialing, all parties agree to neutral binding arbitration of any dispute, thus giving up rights to have the dispute litigated in the courts. (2) Matters excluded from mediation and arbitration include foreclosure proceedings, unlawful detainer actions, mechanics' liens, matters within court jurisdiction, and tort injuries from latent or patent defects to the property. C. Additional Mediation and Arbitration Terms Some transactions are excluded from mediation and arbitration. They include foreclosures, unlawful detainer actions, filing or enforcing mechanic's liens, and any matter that is within the jurisdiction of a probate, small claims, or bankruptcy court.

1. Offer

This section shows the name of the buyer, describes the property to be purchased, the offered purchase price, and the closing date for escrow. A. This Is an Offer From This identifies the document as an offer from a specific buyer. List all buyers' names instead of using "nominee" or "assignee", even if not everyone has signed. Sam Winter and Cindy Winter B. The Real Property to Be Acquired This section describes the property for purchase by address, legal description, and/or assessor's parcel number. It also indicates the city or county where the property is located. A single-family detached home located at 1652 Hill Street, Any City, California. The property is located in Apple County. The property's legal description is Lot 2 of Block 30 of Hillside Ranch Subdivision, as shown on page 875 of book 465, records of Apple County. The assessor's parcel number is PQ9856. C. The Purchase Price The purchase price is the amount the buyer offers to pay the seller for the property. This amount does not include closing costs, any required funding fees, or insurance premiums. Write the purchase price in words, and in numbers: Four hundred fifteen thousand dollars and zero cents ($415,000.00) D. Close of Escrow Write a specific date for the close of escrow or choose a date that is a specific number of days after the offer is accepted. This sets the time for close of escrow in order to complete the transaction. June 30, 20xx or forty-five (45) days after acceptance of offer

16. Additional Terms

This space is provided for additional owner-broker agreements or terms. In our case study, the Springs offer to pay Tom Baker more if he can close an escrow within 30 days of the listing. One percent (1%) more to the listing broker if an offer for the exact terms of the listing closes within 30 (thirty) days of the listing date.

Estimated Seller's Proceeds

This worksheet estimates the seller's approximate costs and proceeds from the sale of a property. Closing costs vary from county to county, but your broker should have estimates for you to use in your area. Typically, the commission, title, recording, escrow, inspection, property tax proration, home warranty, and repairs are calculated. Once this number is deducted from the expected sales price, the seller can deduct the balance of any loans on the property.

28. Time of Essence; Entire Contract; Changes

Time is often significant in a contract. The performance of a contract may be measured by the passage of time. By law, if no time is required by the contract, a reasonable time is allowed. If the act can be done instantly— as in the payment of money— it must be done at once. Buyer and seller agree that any act should take place on the date and time stated. This agreement may only be changed in writing, and it incorporates all prior written and oral agreements.

Art Deco style

Two or more stories and emphasizes the vertical lines of the house. It is angular and boxy with a flat roof and simple, clean, crisp lines. Glass blocks, metals, plastics, and other machine-made materials are used extensively. The walls are smooth texture stucco or stone. Geometric designs such as zigzags, chevrons, diamonds, and sunbursts are arranged in horizontal bands and painted or cut out near the roofline.

20. Equal Housing Opportunity

Under Federal law and California law, it is illegal to discriminate based on race, color, religion, sex, handicap, familial status, or national origin.

13. Sale of Buyer's Property

Unless paragraph 13B is checked, sale of the buyer's property is not a contingency. A separate addendum called Contingent on Sale of Property (COP), must be attached if this matter is to be a contingency.

Escrow Holder

Upon receipt of the signed purchase agreement, the escrow holder's first responsibility is to open an escrow file and create escrow instructions. Once escrow is opened, the escrow holder will serve as a depository for documents and funds and will complete a variety of tasks until closing the escrow when title is transferred and funds are appropriately disbursed.

B. Seller Representation

Upon signing, this listing agreement creates a single agency wherein the broker represents the seller. The broker will not be the agent of the buyer.

Cape Cod style house

Usually rectangular-shaped, one to one-and-one-half stories, and has a steeply pitched gable roof with a small overhang. Some Cape Cod houses also have small gable dormers. The roof is wood shingles and the exterior is wood siding or stucco. The multi-paned windows with ornamental wood shutters are symmetrically placed on both sides of the front door. Masonry chimneys are usually located at the side. Aside from shutters, this style has very little ornamentation and no front porch. The garage is detached and placed at the back of the lot.

Regency style

Very similar to the Georgian except it has an octagonal window over the front door, double-hung windows, and a chimney on the far left or right side of the house.

Disclosures Required of Both Real Estate Agents in the Transfer of Residential Real Property

Visual Inspection Agency Relationship Disclosure Disclosure of the Negotiability of Real Estate Commissions No Disclosure Required for Manner/Occurrence of Death; Affliction of Occupant with AIDS Disclosure of Sale Price Information

Second Empire style houses

Were inspired by Parisian designs during the reign of Napoleon III. The houses are symmetrical, boxy, vertical, and two-to-three stories. Typical ornamentation includes paired columns and elaborate wrought iron along the rooftop. However, the most striking feature is the high, boxy Mansard roof. The Mansard roof has a trapezoid shape. It slopes almost straight up to the top, where it abruptly flattens. The boxy roof shape allows more usable living space in the upper story. The windows are tall and narrow with no shutters. The exterior walls are usually stucco, brick, or wood siding.

Present the Agency Disclosure Statement

When selling residential property of four units or less, the law requires all real estate licensees to give a Disclosure Regarding Real Estate Agency Relationships, which explains the nature of agency to prospective sellers and buyers. The steps in the disclosure process are to disclose, elect, and confirm (DEC).

Private Mortgage Insurance (PMI)

When the loan exceeds 80% of the value of the property, lenders usually require private mortgage insurance (PMI) on conventional loans. Usually borrowers pay for this insurance as part of the monthly payment. Conventional lenders usually require private mortgage insurance on low down payment loans for protection if borrowers fail to make their payments.

Seller Escrow Obligations

When the seller receives the escrow instructions, plan to be available to answer any questions. *Remind the seller to read the escrow instructions before signing them because it is important to verify that the escrow instructions accurately state the terms of the purchase agreement. *Be sure the seller signs the grant deed before a notary public and return the grant deed to escrow. *The seller will rely on your expertise to get the various inspections scheduled, any required repair work completed, and proper certifications made. Typically, these include pest, roof, and septic inspections and certifications. You must also check smoke detectors and appropriate water heating bracing. **Send all certifications to escrow immediately. The seller would not want a delay in the closing due to improper delivery of the certifications. *If the buyer is financing the purchase, his or her lender will require an appraisal of the property. Work with the buyer's agent to schedule a time that the property will be available to the appraiser. *Some items will be prorated in escrow. Tell the seller to give the latest property tax bill, homeowner's assessment, and mortgage statement to the escrow holder. If the buyer plans to assume the seller's fire insurance policy, remind the sellers to provide the policy to escrow so the premium can be prorated. *Make sure the seller provides escrow information about anything that will be paid off through escrow, such as outstanding liens, judgments, security agreements, or loans. Unless assumed by the buyer, any tax liens, judgments, loans, or mechanic's liens against the property are usually paid with the proceeds from the sale of the property. *If the seller plans to sell any personal property outside of escrow, prepare an inventory sheet. Usually escrow will prepare the bill of sale for the personal property. The seller should not release possession of the personal property or execute the bill of sale until he or she has received the agreed-upon payment. *If the property is a rental, remind the seller to give escrow a copy of the lease and a statement showing the amount of security deposit. Provide assignment to the buyer of all leases affecting the property.

Orders a Title Search

When the sellers and buyers reach an agreement about the sale of the property, they also select a title company. One of the jobs of the escrow officer, after escrow opens, is to order a title search and prepare a preliminary report for the property.

Writing an Effective Ad

When writing an effective ad, remember that a person spends only about four seconds skimming an ad. The AIDA formula will help you write ads that attract the customer's attention and interest, create desire, and stimulate action. Mnemonic — AIDA · Attention: First, get the customer's attention. · Interest: Give them benefits to create interest. · Desire: Make the offer irresistible to create desire. · Action: The customer must act in order for you to make a sale.

Spanish Revival

Will have red-tiled roofs, stucco siding, arched entryways and windows, and decorative tiles by the windows and doors.

Amortized (Installment) Payments

With installment payments, the loan is repaid in equal payments, typically monthly, until the loan has been repaid in full. The principal and interest are calculated for the term of the loan, and payments are determined by dividing the total by the number of payments in the term of the loan. Regular, periodic payments to include both interest and principal are made, which pay off the debt completely by the end of the term. This type of loan is fully amortized because the loan and interest are paid off when the last payment is made.

A. Disclosure

You should have already given them the Disclosure Regarding Real Estate Agency Relationships form, and disclosed, elected, and confirmed the agency. This disclosure is required by law and pertains to sales, exchanges, installment land sale contracts, leases with the option to purchase, any other options to purchase, or ground leases coupled with improvements.

Methamphetamine Contamination Notice

You should include a "Methamphetamine Contamination Notice" form in your seller's package. Although you may not need to use it, commencing January 1, 2006, a property owner must complete this disclosure form if a local health official has issued an order prohibiting the use or occupancy of the property. The property owner must either clean up or pay for the clean up and remediation of any contamination caused by meth lab activity. For more information, see Assembly Bill 1078.

Principle of substitution

principle of substitution affirms that the maximum value of a property tends to be set by the cost of acquiring an equally desirable and valuable substitute. An owner cannot expect to sell for more than someone would ordinarily pay for a similar property under similar conditions.

Promotional mix

the combination of the promotional methods to reach the target market and reach your goals.