Real Estate Fundamentals: Chapters 1-13

What are the maximum amounts payable from the recovery fund for claim?

$20,000 per claim; $100,00 per license.

The unauthorized practice of law (giving someone legal advice) can result in a fine of what?

$2500.00 fine and up to a year in jail

The maximum penalty for engaging in unlicensed activity first offense is a fine of up to how much?

$500.00 (and/or imprisonment not to exceed 3 months)

An owner of real estte was declared legally incompetent and was committed to a state mental institution. While institutionalized, the owner wrote and executed a will. The owner later died and was survived by a spouse and three children. The real estate will pass to who?

(According to the state law of descent) Spouse

Chemical compounds used in aerosols, insulating materials, refrigerator and air-conditioner coolants, and other products. CFCs are widely banned today due to their damaging effect on the ozone layer.

(Chlorofluorocarbons) CFCs

Regulates and enforces all discharge into water sources and wetland destruction/construction.

(Clean Water Act) CWA

When the title to one parcel of real estate is held by two or more individuals, those parties are called what?

(Co-owners) concurrent owners

Administered and enforced by the EPA to clean up uncontrolled hazardous waster sites, identify potential responsible parties (PRPs) and establish liability. The different types of liability include strict liability (landowner has no defense), joint and several liability (each of several landowners are responsible for entire cleanup), and retroactive liability (previous landowner is responsible); CERCLA decides immunity.

(Comprehensive Environmental Response, Compensation, and Liability Act) CERCLA (Superfund)

What is PA first real estate license law?

(Real Estate Licensing and Registration Act) RELRA

What law was adopted on February 19, 1980, and is a statutory law, enacted by state legislature and signed into law by the governor? It is administered by the State Real Estate Commission. The purpose of this law is to protect the public interest.

(Real Estate Licensing and Registration Act) RELRA

Provides funds to assess and clean up brownfields, clarify liability protections, and provides tax incentives toward enhancing state and tribal response programs.

(Small Business Liability Relief and Brownfields Revitalization Act) Brownsfield Law

When a tenant breaches a lease or improperly retains possession of the premises, the landlord may regain possession through a legal process known as what?

(Suit for possession) eviction

What Act increased the Superfund to $8.5 billion, provided funds for studying the use of new technologies and required the EPA to assess the risk to human environmental health at every site on the Superfund list. Created the innocent landowner immunity status.

(Superfund Amendments and Reauthorization Act)SARA

Commonly found on sites where petroleum ‎products are used or where gas stations and auto repair shops are ‎located. In residential areas, these are used to store heating oil. Over ‎time, some may leak hazardous substances into the ‎environment. They are subject to federal and state laws, which may be more stringent. When a property purchase is being considered, a careful inspection of any property with these type of containers. What are they called?

(Underground Storage Tanks) USTs

What Act provides for the rehabilitation or recycling of brownfields and requires an environmental covenant that indicates the cleanup or containment of hazardous materials. The Act is implemented by The Department of Environmental Protection (DEP), and includes setting up a PA Environmental Covenant Registry that lists all properties with attached covenants.

(Uniform Environmental Covenants Act) UECA

In what type of lease does the landowner lease unimproved land to a tenant who agrees to erect a building on it? It is most often used in commercial and industrial property development and usually involve separate ownership of the land and building. These leases must be for a long enough term to make the transaction desirable to the tenant investing in the building. They often run for terms of 50 to 99 years. The lessee pays rent on the ground as well as real estate taxes, insurance premiums, and upkeep and repair costs.

.ground lease

Discount points are used to increase the lender's yield (rate of return) on its investment. How much is a point?

1% of the amount being borrowed (not purchase price)

If a broker's office is removed from the location designated in the license, all licensees working at that location may make application to the commission designating the new location of the office. This application must be filed before the removal or within how may days thereafter?

10 days

When a licensee changes employment from one broker to another, the licesee may notify the commission no later that how many days?

10 days

The role of the Fed is to maintain sound credit conditions, help counteract inflationary and deflationary trends, and create a favorable economic climate. The Fed divides the country into how many federal reserve districts?

12

How many continuing education requirements are needed for licensed brokers and salespersons?

14-hours

A federal requirement for residential property built prior to what year is required to have a Lead Based Paint Disclosure?

1978

What is the maximum amount of security deposit a landlord may charge for the first year?

2 months rent

In the rectangular survey system a principal meridian lines are used. Land parallel to meridians and base lines are divided into ranges and townships. The townships are divided into sections, then fractions of sections. Each township contains 36 sections and each section is how many acres?

23,040 acres

Licensure requirements for applicants for a broker license must be 21, have high school diploma (or equivanlent), and have completed how many hours of real estate instruction as prescribed by the Commission

240 hours

A broker must keep records of all real estate transactions for how many years following the consumption or termination?

3 years

A time-share salesperson must be 18 years of age, complete 30 hours of instruction in specific topics, and complete not less than how many hours of onsite training in a time-share facility prior to licensure?

30 days

What is the statute of limitations in PA to file for breach of contract?

4 years

How much does an acre contain?

43,560

How long does a revocation of a license last?

5 years

Purchasers of time-share and campground membership have the right to cancel a purchase until midnight of what day after the contract is executed?

5th day

For how long must a broker retain copies of the signed Consumer Notice when no transaction resulted?

6 months

A Cemetery Broker must pass a written exam prior to licensure, be engaged for 3 years as a salesperson or cemetery salesperson, and have how many hours of instruction?

60 hours

A Referral Agent is an individual or entity who owns or manages a business that collects rental information for the purpose of referring prospective tenants to rental units. This licensee does not lease or show property but rather sells lists of available rentals. They must pass both portions of the exam prior to being issued a license and do how many hours of training?

75 hours

A Salesperson is an individual who is employed by a licensed broker of record to do activities such as sell or offer to sell real estate, or list real estate for sale, negotiate the purchase, sale, or exchange of real estate, etc. How many hours of real estate as prescribed by the Commission are they to do?

75 hours (as well as pass both portions of the written exam)

What is the name of the deed that contains no express warranties against encumbrances?

A Bargain and sale deed.

What is the name of the deed that provides the least protection of any deeds? It carries no covenants or warranties and generally conveys only whatever interest the grantor may have when the deed is delivered. If the grantor has no interest, the grantee will acquire nothing

A Quitclaim deed

What is a legal entity—an artificial person—created under the laws of the state from which it receives its charter?

A corporation

Which of the following is acting as an agent for the buyer and for the seller in the same transaction?

A dual agent

What is the name of the arrangement whereby the owners of property sell the property and then lease it back for an agreed period and rental?

A sale and leaseback is often used when extra capital is needed on a construction project. The original owners pull out their equity to use on other projects and reduce their taxable income when they pay rent to the new owner. The new owner now has a reliable source of rental income for an extended time.

What would be used to clear a defect from the title records?

A suit to quiet title

What type of deed conveys naked title or bare legal title?

A trust deed

What is a device by which one person transfers ownership of property to someone else to hold or manage for the benefit of a third person?

A trust.

What is a summary report of what the title search finds in the public record?

Abstract of Title

What is a summary report of what the title search found in the public record?

Abstract of title

The clause in a mortgage or trust deed that can be enforced to make the entire debt due immediately if the mortgagor defaults on an installment payment or other covenant?

Acceleration Clause

A mortgage typically includes a clause that assists the lender in foreclosure. If a borrower defaults, the lender has the right to declare the entire debt due and payable immediately. If the Lender wasn't able to do this he would have to sue the borrower every time a payment was overdue. What is the name of this clause?

Acceleration clause

The acquisition of land through deposit of soil or sand washed up by water is called?

Accretion

What Act authorizes the Bureau of Professional and Occupational to adopted a schedule of civil penalties that may be imposed by investigators and inspectors for lesser violations of RELRA and Regulations. When these violations are discovered during the routine inspection of a real estate office or proprietary school or during the investigation of a complaint, a citation can be issued and the licensee can admit fault and pay the predetermined penalty. This procedure is intended to free the Real Estate Commission's resources to concentrate on more serious offenses. Of course, a licensee can refuse to accept the citation and pursue the rights of due process previously described

Act 48

What Act of 1993 authorizes the Bureau of Professional and Occupational Affairs to adopt a schedule of civil penalties that may be imposed by investigators and inspectors for lesser violations of the RELRA and Regulations?

Act 48

What Act of RELRA specifically lists prohibited acts such as misrepresentation, mishandling escrow funds, inappropriately paying commissions, and misleading advertising?

Act 604

What type of real estate tax is Latin for "according to value" and are based on the value of the property being taxed and are specific, involuntary, statutory liens. They are charged by various government agencies and municipalities.

Ad Valorem Tax

A loan in which the principal as well as the interest is payable in monthly or other periodic installments over the term of the loan?

Amortized loans

a naturally occurring chemical element, found naturally in bedrock, used in the production of pesticides and wood preservatives, and causes poisoning and linked to cancer?

Arsenic

A fire-resistant, long, thin, fibrous silicate mineral with insulating properties, which can cause cancer when inhaled. Was once used extensively as insulation and to strengthen other materials.

Asbestos

The official valuation process of real estate for tax purposes is called?

Assessment

Unless the Contract originally prohibits, a party to a contract may transfer rights and/or duties under the contract. What is this known as?

Assignment

What is the transfer in writing of interest in a bond, mortgage, lease, or other instrument?

Assignment

What contains no express warranties against encumbrances

Bargain and sale deed

Which deed merely implies but does NOT specifically warrant that the Grantor holds good title to the property?

Bargain and sale deed

To be marketable, a title must, disclose serious defects, not expose purchaser to hazards, prove purchaser could sell property at a later time and what else?

Be insurable by a reputable title insurance company at ordinary rates.

At one time can a taxpayer exercises his "equitable right of redemption"?

Before the tax sale

What is the promise exchanged for another (such as an item for money)?

Bilateral Contract

A party who fails to perform on time is liable for ?

Breach of Contract

When a salesperson receives a earnest money check from the buyer along with the buyers office who gets the check?

Broker

Who is the individual broker responsible for the licensed real estate activities of a partnership, association, or corporation licensed as broker?

Broker of Record

Defunct, derelict, or abandoned commercial or industrial sites; many have toxic wastes.

Brownfield

The process of arriving at a real estate tax begins with the adoption of what?

Budget

PA's Plain Language Act requires that many consumer contracts a. be written in English b. be written in English and another language commonly spoken in that area c. use short words and be written in the active voice d. include explanatory footnotes to explain the "legalese."

C: use short words

The process of laying two to four feet of soil over the top of a landfill site and then planting grass on it to enhance the aesthetic value and prevent erosion.

Capping

Section 201 of the RELRA and 35.201 of the Regulations define this type of Broker as an individual or entity who engages in the business in the capacity of a broker, exclusively within the limited field of business that applies to cemetery lots, plots, and mausoleum spaces or opening. What type of Broker is this?

Cemetery Broker

What is a statement of opinion on the status of the title to a parcel of real property based on an examination of specified public records?

Certificate of title.

How must a contract be entered into, which is a free and voluntary act of each party?

Consent

What is something of legal value offered by one party and accepted by another as an inducement to act or to refrain from some act?

Consideration

A Contract that is something of legal value offered by one party and accepted by another as an inducement to act or to refrain from some act is called what?

Consideration (must be in a contract)

What is the legal presumption that information is available and can be obtained by an individual through diligent inquiry?

Constructive notice

For what document does the Real Estate Commission require the use of a specific form?

Consumer Notice

Section 35.336 requires licensees to provide a particular document to those in which they have had a substantive discussion about real estate. This document details the nature of business relationships.

Consumer Notice

What is a legal entity-an artificial person-created under the laws of the state from which it receives its charter? (can own real estate)

Corporation

General Warranty Deed includes 5 Covenants: Covenant of seisin, covenant against encumbrances, covenant of quiet enjoyment, covenant of further assurance and what else?

Covenant of warranty forever (The Grantor guarantees to compensate the grantee for the loss sustained if the title fails any time in the future)

What is the type of cooperative organizations, whose members place money in savings accounts, and routinely originate longer-term first and second mortgages and deed of trust loans?

Credit unions

Vertical elevations, either above the surface or below the surface, are measured from what? It's measured as the mean sea level at New York Harbor

Datum

A Grantee receives title by?

Deed

What is a written instrument used to transfer title to real estate?

Deed

What is an alternative to foreclosure where the lender may accept a deed in lieu of foreclosure from the borrower. The disadvantage is that the mortgagee takes the real estate subject to all junior liens.

Deed in Lieu of Foreclosure

If the redemption is not made or if state law does not provide for a redemption period, the successful bidder at the sale receives a deed to the real estate. What type of deed is this called?

Deed to Purchaser at Sale

The Plain Language Consumer Contract Act in Pennsylvania requires simple and easy-to-understand language in all of the following contracts EXCEPT?

Deeds and mortgages

What type of clause is issued when a mortgage has been paid off?

Defeasance clause

What type of judgment is levied against a borrower when a foreclosure sale does not produce sufficient funds to pay the mortgage debt in full?

Deficiency Judgment

The 5 requirements for a Valid Deed are: Granting clause, Habendum clause, legal description, signature of Grantor (acknowledged -notarized) and what else?

Delivery and acceptance

What is used to increase the lender's yield (rate of return) on its investment. For example, the interest rate that a lender charges for a loan might be less than the yield an investor demands.

Discount Points

What is the states right to use water?

Doctrine of prior appropriation

A field of energy produced by electricity flowing through power lines. Under investigation for health risks.

Electromagnetic Fields

What is the process of sealing off of disintegrating asbestos or chipping and peeling lead based pain? It may be preferable to removal; still leaves hazard behind.

Encapsulation

What is the illegal extension of a building or fence that extends beyond the land of the owner and is usually disclosed by either a physical inspection of the property or a spot survey?

Encrouchment

These type of funds of hospitals, universities, colleges, charitable foundations, and other institutions provide a good source of financing for low-risk commercial and industrial properties.

Endowment funds.

What factor is used to achieve uniformity in some jurisdictions where it is necessary to correct general inequalities in statewide tax assessments?

Equalization Factor

This type of foreclosure assists defaulting borrowers by giving them a chance to redeem their property by allowing them to keep the property if they are able to pay all costs before the amount is due. The loan then will be reinstated.

Equitable Right of Redemption

What type of tenancy arises when a tenant who lawfully possessed real property continues in possession of the premises without the landlord's consent after the rights expire?

Estate at Sufferance.

What type of tenancy of indefinite duration allows the tenant the right to possess property with the landlords consent for an unspecified or uncertain time. It continues until it is terminated by either party giving proper notice. (stops when either party dies)

Estate at will

What type of estate gives the lessee the right to possession until the estate is terminated by either party; the term of this estate is indefinite.

Estate at will.

An interest in leased property that continues from period to period, week to week, month to month, or year to year?

Estate from period to period

What is the part of the title insurance policy that sets forth all the encumbrances and defects that will not be insured?

Exclusions

When parties state the terms and show their intentions in words, either written or oral, this is what type of contract?

Express

Thrifts, savings institutions, and commercial banks are institutions known as fiduciary lenders because of their fiduciary obligations to protect and preserve their depositors' funds. They are subject to standards and regulations established by governmental agencies such as the ?

FDIC (Federal Deposit Insurance Corporation)

What is the name of a government-sponsored enterprise established to purchase any kind of mortgage loans in the secondary mortgage market from the primary lenders?

Fannie Mae

Condiminium laws often called horizontal property acts, have been enacted in every state. Under these laws, the owner of each holds what type of title to the unit?

Fee Simple

What is a Fee Simple Estate that is a qualified estate that is subject to the occurrence or nonoccurence of a specified event?

Fee Simple Defeasible (2 categories: include Fee Simple Determinable "so long as", "while", "during" and Fee Simple subject to a condition subsequent)

Property deeded to a school for "educational purposes only" is what type of Fee Simple Estate?

Fee Simple Subject to a condition subsequent

A person who has complete control over a parcel of real estate is said to own what type of estate?

Fee simple

What type of estate is a time-share?

Fee simple

What type of title do condominium owners have?

Fee simple

What is the highest interest in real estate recognized by law? Its Intended to run forever; upon the death of its owner, it passes to the owner's heirs.

Fee simple absolute.

To give notice of a security interest in personal property items, a lienholder must record what?

Financing statement

At what time should the real estate licensee present the Consumer Notice to the prospective buyer?

First contact

What is a hazardous air pollutant that is a colorless chemical used to manufacture building materials and many household products, such as particleboard, hardwood plywood paneling, and urea-formaldehyde foam insulation. Since 1985 formaldehyde has been regulated by HUD for use in wood products. Classified as a "probable human carcinogen"

Formaldehyde

What process has emerged as a potential threat to groundwater in PA, with much discussion for and against the process. Using pressurized fluid to create fractures in rock and release natural gas or petroleum

Fracking

Is Freddie Mac provides a secondary market for mortgage loans primarily for what type of loans?

Freddie Mac (Federal Home Loan Mortgage Corporation)

In what type of lien does a creditor have all of a debtors property-both real and personal-sold to satisfy a debt?

General

This type of lien includes judgements, estate and inheritance taxes, decedents debts, corporation franchise taxes, and IRS.

General Liens

When all the partners in a business organization participate to some extent in the operation and management of the business and share full personal liability for the business losses and obligations. What type of ownership is this?

General partnership

What association administers special-assistance programs and guarantees mortgage-backed securities using FHA and VA loans as collateral? Guarantees investment securities issued by private offerors (such as banks, mortgage companies, and savings and loan associations) and backed by pools of FHA and VA mortgage loans. It is a pass-through certificate that is a security interest in a pool of mortgages that provides for a monthly pass-through of principal and interest payments directly to the certificate holder. Such certificates are guaranteed by this institution.

Ginnie Mae (Government National Mortgage Association).

members of the commission are selected by?

Governor

What type of lease involves a tenant erecting a building on unimproved land?

Ground lease

The deed states that the Grantor is conveying all rights and interests of the Grantor to have and to hold by the Grantee. What is this called?

Habendum clause

What is the pledge of property as security for a loan called?

Hypothecation

When a mortgage lender has the right to foreclose on the pledged property in the event of a borrower defaulting this is referred to as ?

Hypothecation

Agreement proven by the act and intentions of the party.

Implied Contract

Charging interest at a higher rate than the maximum rate established by state law?

Interest Usury

Currently in PA what type of theory is adopted which states that property owners do not automatically forfeit the real estate on default of the debt. They must be given a notice of intention to foreclose.

Intermediary Theory

What type of financing often inclues large real estate projects, such as highrise apartment buildings, office complexes, and shopping centers, are often joint ventures through arrangements like syndicates, limited partnerships, and real estate investment trusts?

Investment group financing

What is the transfer of real estate by law and without the owner's consent.

Involuntary Alienation

When is a Trustee's deed used?

It is used when a trustee conveys real estate held in the trust to anyone other than the trustor. The trustee's deed must state that the trustee is executing the instrument in accordance with the powers and authority granted by the trust instrument.

Property that is owned by 2 or more people and is a right of survivorship for which upon the death of a joint tenant, the deceased interests transfers to the surviving joint tenant or tenants. Essentially there is one less owner. What type of tenancy is this?

Joint tenancy

In what method of foreclosure does the property get sold by court order after the mortgagee has given sufficient public notice?

Judicial foreclosure

What is a type of foreclosure that allows the property to be sold by court order after the mortgagee has given sufficient public notice. When a borrower defaults, the lender may accelerate the due date of all the remaining principal balance, along with all overdue monthly payments and interest, penalties, and administrative costs?

Judicial foreclosure.

What is a relatively recent form of business organization that combines the most attractive features of limited partnerships and corporations?

LLC

Who is the licensed professional who is trained and authorized to locate and determine the legal description of any parcel of land?

Land surveyor

An enormous hole, either excavated for the purpose of wastewater disposal or left over from surface mining operations. It is lined with clay or a synthetic liner to prevent leakage of waste materials into the water supply.

Landfill

Who handles the title in a real estate transaction?

Lawyers and title companies

What type of paint was produced before 1978 which, when ingested, causes nervous system damage, stunted growth, and delayed development?

Lead based paint

What is a claim of a creditor or taxing authority against the real property of a debtor that is used as security to ensure repayment of the debt. They may be "general" covering all real and personal property of owner or "specific", covering only identified property. They can also be "voluntary' and "involuntary?

Lien

What is a relatively recent form of business organization that combines the most attractive features of limited partnerships and corporations?

Limited Liability Corporation (LLC)

Under what circumstances may the owner of a campground membership usually use the facilities?

Limited only by weather and access

What is Latin for litigation pending and is not itself a lien, but rather a notice of possible lien?

Lis Pendens

The process of applying for a mortgage includes charging a fee. When this happens most lenders charge a fee to cover the expenses of the Note. What is this fee called?

Loan Origination Fee

The owner has a large parcel of land surveyed into lots and streets and files a subdivision plat. Each lot can be legally described by use of what?

Lot and block

Under the terms of the typical real estate sales contract, the seller is required to deliver to the buyer_______ to the property

Marketable Title

PA's first real estate license law was amended numerous times to relect changes in the industry, however what year was it adopted?

May 1,1929

Where is the property line generally located for PA property owners whose land borders Lake Erie?

Mean high water mark

What is the specific, involuntary lien that gives security to those who perform labor or furnish material to improve real property. It is available to contractors, subcontractors, architects, equipment lessor, surveyors, laborers, and others who have the right to file.

Mechanic's Lien

What type of method is used to describe the legal type of real estate and uses monuments?

Metes and bounds

What type of legal descriptions used to describe real estate locates property boundaries by referencing the direction and distance of the property lines? It starts at the point of beginning (POB)

Metes-and-Bounds

Process of downward land shifts due to the collapse of underground mine shafts

Mine subsistence

A specific, voluntary lien on real estate given to a lender by the borrower as security for a mortgage loan is called what?

Mortgage lien

Who is the person who owes the bank money for mortgage loan. The borrower.

Mortgagor

In what method of foreclosure is no court action required?

Nonjudicial foreclosure

This type of foreclosure is used when the security instrument contains a power of sale clause. No court action is required. In states where deed of trust loans are used, the trustee is generally given the power of sale?

Nonjudicial foreclosure

Does a Bargain and sale deed contain express warranties against encumbrances?

Nope

Contracts can be discharged in different ways: performance of contract, Assignment, Breach of Contract, partial performance, substantial performance, impossibility of performance, mutual agreement, operation of law, and what else?

Novation

What is the substitution of a new obligation for an old one or substituting new parties to an existing obligation?

Novation

When a new contract is substituted for an existing agreement, the process is known as?

Novation

How many of the general partners run the business in a general partnership? The silent partners are legally permitted to.

One or mor

What type of ownership occurs when the property is owned by one individual or corporation?. The term comes from the fact that a sole owner is severed or cut off from other owners. This type of ownership enables the owner to have sole rights to the ownership and sole discretion to sell, will, lease, or otherwise transfer part or all of the ownership rights to another person.

Ownership in Severalty

When ownership of property is owned by one individual or corporation it is what type of ownership?

Ownership in severalty

Under what law can a contractor or subcontractor file a claim with the court of common pleas in the county in which the property is located within 6 months?

PA Mechanic's Lien Law

What are the governmental powers used to limit real estate ownership and are imposed for the general welfare of the community and therefore supersede the rights or interests of the individual?

PETE (Police power, eminent domain, taxation, escheat)

What does a borrowers monthly payments consist ofF?

PITI (Principal, Interest, Tax, insurance)

What is the practice of attempting to sell residential real estate in a particular neighborhood due to fear of declining real estate values when that fear is not based on facts relating to the intrinsic value of the real estate?

Panic Selling

A written real estate contract is assumed to be the complete agreement of the parties because of the ?

Parol evidence rule (written contract takes precedent over oral agreements or promises)

The legal way to dissolve the relationship when the parties do not voluntarily agree to its termination is called what?If the court determines that the land cannot be divided physically into separate parcels without destroying its value, the court will order the real estate sold. Proceeds divided equally.

Partition

What is the legal way to dissolve the relationship when the parties do not voluntarily agree to its termination? If the court determines that the land cannot be divided physically into separate parcels without destroying its value, the court will order the real estate sold. The proceeds of the sale will then be divided among the co-owners according to their fractional interests.

Partition Suit.

An association of two or more people who carry on a business for a profit as co-owners is called what?

Partnership

Because of the comparatively high yields and low risks offered by mortgages, these type of funds have begun to participate actively in financing real estate projects.

Pension funds

Consist of more than 200 organic chemical compounds that are not found naturally in nature. These flame-resistant chemicals were often used in electrical equipment (such as transformers), electrical motors in refrigerators, caulking compounds, and hydraulic oil in older equipment. They are classified as reasonably carcinogenic.

Polychlorinated biphenyls (PCBs)

What is the formal judicial process that proves or confirms the validity of a will, determines the precise assets of the deceased pesron, and identifies the person (s) to whom the assets are to pass?

Probate

When a property is mortgaged, the owner has to sign 2 documents. The first is the Mortgage, or security instrument and the other is what?

Promissory note

In Cooperatives tenants own shares in a corporation, partnership, or trust that holds title to the building. Tenants have proprietary leases and the right to occupy their respective units. What type of lease do they receive?

Proprietary lease

What type of estate is based on the lifetime of a person other than the life tenant?

Pur autre vie

A naturally occurring gas that arises from the earth where radioactive materials are present. Colorless, odorless, tasteless, radioactive; Class A human carcinogen.

Radon

What fund was established for aggrieved parties who have obtained uncollectible judgments against real estate licensees for fraud, deceit, or misrepresentation

Real Estate Recovery Fund

As the river changed course, a property owner gained another couple of acres, since his land description read "to the high-water mark of the river". What is this term for this newly created increase in land? (increase in land due to the gradual receding of a body of water or gradual shift in course of a river)

Reliction

An alienation clause differs from an acceleration clause in that the alienation clause is based upon: (A) Any forfeiture; (B) Any breach; (C) Resale; (D) Delinquency on payment

Resale

The practice of one party canceling or terminating a contract, which has the effect of returning the parties to their original positions before the contract was made.

Rescission

What type of corporation is composed of 100 or fewer shareholders, offers small businesses many of the benefits of a corporation but avoids double taxation?

S Corp

What Act in 1994 requires that PA municipalities develop comprehensive plans to resolve existing sewage disposal problems and to prevent future problems?

SFA (Sewage Facilities Act)

Under this law, the EPA sets maximum levels for pollutants in public water systems. The EPA is especially concerned with contamination from underground sources. System operators must use the best available technology that is economically and technologically feasible. Suppliers must inform the public of the source of the water, the level of contaminants, and possible health concerns.

Safe Drinking Water Act (1974)

What market are the following in: Fannie Mae Conventional, VA, FHA loans, Freddie Mac, conventional loans, Ginnie Mae Special assistance loans.

Secondary Market

The real estate financing market has 3 basic components: Governmental influences, primarily the Federal Reserve System, the Primary Mortgage Market and what other Market?

Secondary Mortgage Market

What a ection of RELRA established the State Real Estate Commission to administer the Act and supervise the activities of licensees in Pennsylvania?

Section 202

What section of RELRA instituted additional remedies or criminal penalties. Permitted Commission to levy a civil penalty of up to $1,000 against any current licensee who violates the Act or any person who practices real estate without being properly licensed

Section 305

What section of the Reg requires that licensees ensure that all contracts are in writing and that all parties receive a copy of records. It also requires licensees to keep records for 3 years when there is no sale.

Section 35.281

What section of the Regulations states that a broker or cemetery broker who license is suspended must return the license to the Commission and prominently post a Commission-approved notice of the suspension at the public entrance of the main office and any branch offices. Failure to post the notice is grounds for further disciplinary action.

Section 35.291

What section of the Regulations provides for estimates of costs and return that may be prepared by the licensee before buyers and sellers execute an agreement of sale?

Section 35.334

Brokers are responsible for depositing funds they receive that belong to others into an escrow account in a federally insured or state-insured bank or depository pending consummation or termination of the transaction. What section is this?

Section 604(5)

What section of RELRA limits the disciplinary action that may be taken against an employing broker when disciplinary action is taken against a licensee employed by that broker?

Section 702

What type of loans are mortgage loans?

Secured loans

What is real or personal property that was owned solely by either spouse before the marriage, by gift or inheritance and any property purchased with separate funds after the marriage?

Separate property

What type of lien is secured by a specific parcel of real estate and affects only that particular property?

Specific

When a survey sketch shows the location and dimensions of the parcel. In what type of survey does it further show the location, size and shape of the buildings on the lot?

Spot survey

Are appraisal activities regulated by the State Board of Certified Appraisers or the State Real Estate Commission?

State Board of Certified Appraisers

Under what authority may municipalities and counties enact legislation to preserve order and to protect public health?

States enabling acts

What statute requires that contracts for the sale of real estate be in writing and signed by the seller to be enforceable in a court of law?

Statute of Frauds

This loan is also known as a term loan or an interest-only loan and it essentially divides the loan into two amounts to be paid off separately.

Straight Loan

What type of loan is "interest only" and is divided into 2 amounts to be paid off separately?

Straight loan (or term loan)

This type of foreclosure in some states allows for a lender to acquire mortgaged property, however they have to first notice must be given to the delinquent borrower?

Strict foreclosure

A court suit initiated by a buyer when the seller breaches a real estate sales contract, asking the court to force the seller to go through with the sale and convey the property as previously agreed.

Suit For Specific Performance

A court action intended to establish or settle the title to a particular property, especially when there is a cloud on the title.

Suit To Quiet Title

When two or more new owners acquire title to a parcel of real estate and the deed does not stipulate the tenancy, they acquire title, by operation or rule of law, as tenants in common. But if the conveyance is made to a husband and wife with no further explanation, PA what type of tenancy is created?

Tenancy by the entirety

The leasehold that automatically renews itself at each expiration is?

Tenancy from period to period

What is the name of the tenancy where a parcel of real estate may be owned by two or more people and each tenant holds an undivided fractional interest in the property?

Tenancy in Common.

A parcel of real estate may be owned by two or more people as tenants in common and each tenant holds an undivided fractional interest in the property this is called?

Tenancy in common

Who is a person who has made a valid will, and is alive?

Testator

What did the Bureau of Professional and Occupational Affairs create in 2006 to provide better, timelier, and more efficient processing of complaints. This makes prosecutorial decisions, including negotiated consent agreements and recommendations for formal actions by prosecutors, and decisions to dismiss complaints?

The Charging Unit

Who issues licensees registration certificates who meet the requirements established by the Act?

The Department of the State

Who regulates the flow of money and interest rates in the marketplace?

The Fed

What act imposes certain mandatory obligations on lenders and loan servicers to set aside (escrow) funds for flood insurance on new loans for property in flood-prone areas?

The National Flood Insurance Reform Act of 1994

What was established to provide a means for aggrieved persons to collect judgements awarded in civil court?

The Real Estate Recovery Fund

Ownership that allows possession for a specific time each year is a ?

Time share

What does the document Title Evidence include?

Title insurance

What document protects against hidden risks, such as forgeries and loss due to defects in the title, subject to specific exceptions ?

Title insurance policy

The document(s) called title evidence include? Title evidence establishes proof of ownership.

Title insurance.

What is the type of search that exams all public records to determine whether any defects exist in the chain of title?

Title search

What are deeds subject to when they are recorded?

Transfer tax

What is a device by which one person transfers ownership of property to someone else to hold or manage for the benefit of a third person?

Trust

How much can the EPA make PRP's pay if they refuse to pay the cost of cleanup?

Up to 3 times the actual cost of the cleanup

A Contract that seems to be valid on the surface but may be rejected or affirmed by one or both of the parties is called called what?

Voidable

Which doctrine does the state of PA recognize that the lessor who leases residential property promises that it is fit for habitation?

Warranty of habitability

The Safe Drinking Water Act SDWA and The Clean Water Act CWA are what "type" of Acts?

Water Acts

the level below which the ground is saturated with water.

Water Table

Is Asbestos highly friable?

Yes

Can Real Estate be owned by Business Organizations Partnerships?

Yup

Does the Uniform Commercial Code (UCC) apply to personal property transactions?

Yup

The Uniform Partnership Act are partnerships recognized as legal entities and able to hold title in the partnerships name?

Yup

When advertising a property for sale does the Broker need to include his business name?

Yup

A promise by the offeree to be bound by the exact terms proposed by the offeror.

acceptance

To be eligible for recording in PA a document must be in writing, properly executed and what else?

acknowledged

This clause provides that when a property is sold, the lender may either declare the balance of the seller's debt due immediately (the buyer must obtain new financing) or permit the buyer to assume the loan at an interest rate acceptable to the lender?

alienation clause (also known as a resale clause or due-on-sale clause).

The transfer in writing of interest in a bond, mortgage, lease, or other instrument?

assignment

What do joint tenancy and tenancy by the entirety have in common regarding the last survivor?

becomes a severalty.

Any income earned from a person's separate property remains part of the separate property. Separate property can be mortgaged or conveyed by the owning spouse without the signature of the non-owning spouse. Separate property refers to property being owned when?

before marriage

A brass marker that surveyors use to mark local datums is called a ?

benchmark

In other states, not PA, lenders may prefer to use a three-party instrument known as a deed of trust. This conveys naked title or bare legal title (no right to possess). The deed is given as security for the loan to a third party, known as what?

beneficiary

One of the distinguishing characteristic of a land trust includes that public records do not usually name what?

beneficiary

Because in a real estate contract the seller promises to sell a parcel of real estate and deliver title to the buyer, who promises to pay a certain sum of money for the property, this is an example of what type of contract?

bilateral contract

The Real Estate Commission may take disciplinary action against a licensee for all of the following EXCEPT for violating which laws?

blue-sky laws

A salesperson receives an earnest money check from the buyer along with the buyer's offer. Who should the check be turned over to?

broker

Who is given the greatest protection in a general warranty deed?

buyer

What is a colorless, odorless toxic flammable gas formed by incomplete of carbon?

carbon monoxide

A broker receives a check for earnest money from a buyer and deposits the money into an escrow or trust account. This protects the broker from a charge of?

commingling

Real estate ownership that involves holding title to an individual unit and a specified share of the undivided interest in the common elements is a ?

condiminium

Is Fannie Mae a conservatorship or a mortgage company?

conservatorship

Why are documents affecting real estate recorded or filed with the county in which the property is located?

constructive notice

What is an example of a bilateral contract?

contract

In a cooperative ownership who holds title to the land and the building?

corporation

A grantor conveys property by what?

deed

How are condominiums transferred?

deed (will or living trust)

A deed given by the mortgagor to the mortgagee when the mortgagor is in default under the terms of the mortgage. This is a way for the mortgagor to avoid foreclosure?

deed in lieu of foreclosure (friendly foreclosure)

What is an instrument used to create a mortgage lien by which the borrower conveys title to a trust, which holds it as security for the benefit of the note holder (the lender)?

deed of trust

A clause used in leases and mortgages that cancels a specified right upon the occurrence of a certain condition, such as cancellation of a mortgage upon repayment of the mortgage loan?

defeasance clause

A personal judgment levied against the borrower when a foreclosure sale does not produce sufficient funds to pay the mortgage debt in full?

deficiency judgment.

The gift of real property by will is known as a

devise

Tenancy in common may be terminated by "J's Dad", which stands for J=Judgement, D=death, A=agreement and D= ?

divorce

The right of a government body to take ownership of real estate for public benefit is called?

eminent domain

A Special warranty deed contains 2 basic warranties including that the granter received the title and what else and that the property not be ?

encumbered

A special warranty deed includes 2 basic warranties: That the Grantor received title, and that the property not have any what?

encumbrances

When is the Broker responsible for depositing the funds in escrow?

end of the next business day following the receipt.

What is the right of a defaulted property owner to recover the property prior to its sale by paying the appropriate fees and charges?

equitable right of redemption

After examining the public records, the title insurance company usually issues what may be called a Preliminary Report of Title or a Commitment to issue a title policy. It includes name of insured, legal description of property, estate or interest covered, conditions and stipulations under which policy was issued and what else?

exceptions (schedule of exceptions- including encumbrances and defects found in the public records and any known unrecorded defects)

In what type of contract does one or both parties still have some act to perform. An agreement of sale is an example of this type of contract. It is not signed until closing: Ownership has not yet changed hands, and the seller has not received the full sales price.

executory contract exist?

Tanks that hold less than 110 gallons, Farm and residential tanks that hold 1,100 gallons or less of motor fuel used for noncommercial purposes, tanks that store heating oil, tanks on or above the floor of underground areas, such as basements or tunnels, septic tanks and systems for collecting storm water and wastewater. All of these USTs are exempt from what type of regulations?

federal regulations

For a lender to create a security interest in personal property, the Uniform Commercial Code (UCC) requires the borrower to sign a security agreement. A short notice of this agreement must be filed with the recorder of deeds. What is this agreement called?

financing statement.

The effect of recording a warranty deed is to protect the interests of the ?

grantee

What type of lease has the landlord paying all property charges regularly incurred through ownership, such as repairs, taxes, insurance premiums, and operating expenses. Most of these leases are residential leases.

gross lease

What activity may an unlicensed assistant carry out for other licensees?

hold open house

Who is the condominium property administered by?

homeowners' association (HOA)

A broker manages a large apartment community. The termite company offers the broker $100 each time that the broker hires the termite company; the broker sees no reason to inform the owner. In this situation, this compensation is?

illegal

A salesperson wants to change offices. The salesperson returns her current license along with the required fee and the change of employment notification. At which time may the salesperson be involved in real estate activities on behalf of the second broker after mailing the change of employment notification?

immediately

Standard of coverage includes defects, forged documents, incompetent grantors, incorrect marital statements and what else?

improperly delivered deeds

PA has adopted this theory that states, the property owner does not automatically forfeit the real estate on default of the debt. The borrower must first be given a notice of intention to foreclose before the lender can file suit and proceed with foreclosure. The notice forewarns the borrower and provides an opportunity to resolve the matter before the lender takes legal action.

intermediary theory

When a person dies and has no heirs the title to the estate passes to the state by the state's power of escheat. Land may be acquired through the process of accretion or actually lost through erosion. Other acts of nature, such as earthquakes, hurricanes, sinkholes, and mudslides, may create or eliminate a landowner's holdings What is this referred to as?

intestate

A Contract is a voluntary, legal enforceable promise between two competent parties to perform (or not perform) some legal act in exchange for consideration. It must be voluntary, made by legally competent parties, supported by legal consideration and what else?

legal

Who may amend or modify the Real Estate Licensing and Registration Act?

legislature

The State Real Estate Commission functions under the Bureau of Professional and Occupational Affair within the PA Dept of State. It is comprised of 11 persons. The Commissioner, Director, 3 public members, 5 licensed real estate brokers (10 years), and 1 other person. Who is that person?

licensed Broker (or Cemetery Broker-having been licensed for at least five years and sold cemetery lots for at least 10 years)

In what theory do some states interpret a mortgage as being purely a lient on real property?

lien theory

What type of title has to disclose no serious defects and not depend on doubtful questions of law or fact to prove its validity?

marketable title

What is a fungus that produces a superficial growth on various kinds of damp or decaying organic matter?

mold

When a property is to be mortgaged, the owner must execute (sign) two separate instruments: the promissory note and what else?

mortgage

In what type of lease does the tenant pay all or most of the operating expenses in addition to the rent?

net lease

What type of lease requires the tenant to pay not only rent but also costs incurred in maintaining the property, including taxes, insurance, utilities, and repairs?

net lease

Are there currently federal requirements to disclose mold contamination?

no

Is a deed of trust used in PA?

no

The Uniform Commercial Code (UCC) is a commercial law statute that has been adopteed to some extent in all 50 states. Does the UCC applies to both real estate and personal transactions?

no ( only personal transactions)

Is an express contract an agreement of the parties demonstrated by their acts and conduct?

no (Implied)

Is mental capacity the same as medical sanity?

no (the test is whether a person is capable of understanding their actions)

A Cemetery Salesperson in an individual who is employed by a broker or cemetery broker for the exclusive purpose of engaging in the specialized field of cemetery lot sales. They must be 18 years old, submit a sworn affidavit from the employing broker or cemetery broker attesting to the applicant's good reputation and that the broker will actively supervise and train the applicant. In addition are they required to complete education and an exam?

nope

An Associate Broker is an individual who has met the broker license requirements but who is employed by a broker of record. Are they able to engage in the real estate business in their own name or from their own place of business?

nope

Are candidates for licensure required to be either a US citizen or resident of PA in order to be issued a license?

nope

Are licensed salespersons, brokers, and time-share persons required to obtain a separate license to sell campground memberships?

nope

Has the EPA been able to establish a "threshold" safe level of radon exposure?

nope

In PA a person must be 18 years old and of sound mind to make a will. Does the law also requires that the will be signed by the testator and be witnessed or acknowledged?

nope

In a strict foreclosure the borrower must be given notice and then a deadline is set for the balance of the defaulted debt must be paid in full. In this method of foreclosure is it necessary to go to court?

nope

Is a Rental Listing Referral Agent required to be affiliated with a Broker?

nope

Is an express contract an agreement of the parties demonstrated by their acts and conduct?

nope

Is payment of a commission by a licensed broker to another licensed broker cause for disciplinary action against a licensee?

nope

Mortgage brokers locate potential borrowers, process preliminary loan applications, and submit the applications to lenders for final approval. Are they Lenders?

nope

Proof of ownership is evidence that the title is , in fact, marketable. Is the deed itself evidence of ownership?

nope

Is a warranty deed acceptable as the evidence of marketable title?

nope ( A title insurance policy is acceptable evidence)

Is a Certificate of Title a guarantee of ownership?

nope ( It certifies the condition of the title based on the title search)

The Uniform Electronic Transaction Act (UETA) sets forth basic rules for entering an enforceable contract using electronic means and has been enacted in ALL states?

nope (only some)

Are the members of the Commission selected by the state association of REALTORS?

nope (they are appointed by the Governor)

A promise made by one party requesting something in exchange for that promise with the intention that the offer will be bound to the terms if the offer is accepted.

offer

The regulations define a Broker of Record as the individual broker who is responsible for the real estate transactions of a partnership, association or corporation licensed as a broker. How many individuals may be recognized at the broker of record, regardless of the number of offices the firm operates?

only one

When a corporation is s recognized as a legal entity it can hold title to real estate in a sole owner (severalty), trust (trustee) or what?

partner (or in a partnership)

The Secondary Market stimulates both the housing construction market and the mortgage market by expanding the types of loans available by assembling them into packages called?

pools

The secondary mortgage market exists to help lenders raise capital to continue making mortgage loans, it does not interact directly with borrowers. Further the secondary market is especially useful when money is in short supply; it stimulates both the housing construction market and the mortgage market by expanding the types of loans available. In the secondary market, various agencies purchase a number of mortgage loans and assemble them into packages called? These agencies purchase the mortgages from banks and savings associations. Securities that represent shares in these pooled mortgages are then sold to investors or other agencies

pools

What does seisin mean?

possession

The party who hires a real estate licensee to market his home is considered the?

principal

Why did The Bureau of Professional and Occupational Affairs create a Charging Unit in 2006?

process of complaints

A financing instrument that confirms the debt is signed by its maker and is negotiable (transferable to a third party)?

promissory note

What is the purpose of License Laws?

protect the public

PA's Uniform Condominium Act requires purchasers be provided with information and sign what at least 15 days before purchase?

public offering statement.

A very active and successful associate broker has formed a team consisting of herself and two other licensees to assist her. The Commission allows this broker of record to pay commission checks for all three licensees when what type of association is formed?

qualified association

When a grantor guarantees that the title will be good against the title claims of third parties this is referred to as the covenant of?

quiet enjoyment

When a title insurance policy is being issued, the public records are searched and the title company's record of title is continued to date. When the title examination is complete, the title company notifies the parties in writing of the condition of the title. This notification is called?

report of title ( commitment for title insurance)

When a title company makes a payment to settle a claim covered by a policy, the company generally acquires the right to any remedy or damages available to the insured. This right is called?

subrogation.

Joint Tenancy is ownership of real estate between two or more parties who have been named in one conveyance as joint tenants. Upon the death of a joint tenant, the decedent's interest passes to the surviving tenant or tenant's by the right of ?

survivorship

When a person who dies and has prepared a will indicating how the deceased's property will be disposed of they are making a voluntary action called?

testate

The State Real Estate Commission functions under what organization?

the Bureau of Professional and Occupational Affairs

Evidence of the kind of estate and all liens against a parcel of real estate can usually be proven by Certificate of title or what else?

title insurance

In some states this theory interprets a mortgage to mean that this person is the owner of the mortgaged land and that upon full payment of the mortgage debt, the borrower becomes the landowner. What theory is this?

title theory

Who is the party who holds a real estate license and provides services for a consumer without being an agent or advocate of the consumer?

transaction licensee

"Mandatory language prescribed by the Act and the Regulations' purpose is to ensure that consumers are properly informed about their rights in what?

transactions ( and that certain procedures are properly disclosed)

What is the name of the fund that many lenders require borrowers to provide a reserve fund for future real estate taxes and insurance premiums?

trust (escrow account)

A Contract that is valid between the parties but the court cannot force the parties to perform is said to be what?

unenforceable

A contract that has all the elements of a valid contract, yet neither party can sue the other to force performance of it. An example would be an unsigned contract .

unenforceable contract

What type of contract involves a party making a promise to induce another to act, and that person acts as instructed?

unilateral contract

While the real estate license laws regulate the real estate industry, their main objective is to ensure that the rights of purchasers, sellers, tenants, and landlords are protected from what type of practices?

unscrupulous (or sloppy practices)

A contract that meets all the essential elements that make it legally sufficient to be enforceable is said to be what?

valid

A Contract that has no legal force or effect and is, therefore not binding on the parties is said to be ?

void

A contract that has no legal force or effect because it does not meet the essential elements of a contract.

void contract

A Contract that appears valid but may be rescinded or disaffirmed is said to be ?

voidable

A contract that seems to be valid on the surface but may be rejected or disaffirmed by one or both of the parties?

voidable contract

A mortgage is a lien and in title theory the Mortgagor (borrower) gives legal title to the mortgagee (lender) and retains equitable title. When is legal title returned to the Mortgagor?

when the debt is paid off

Title can be transferred in 3 ways: voluntary alienation (gift, sale or by will) involuntary alienation and what else?

will (or descent after the owner dies)

How do the parties state their terms in an express contract?

word

What do parties state in an Express contract?

words

Are ALL of the following traditionally covered by standard title insurance: improperly delivered deeds, defects found in public records, forged documents, incompetent grantors, and incorrect marital statements.

yup

Are capacity to contract., Legal objectives, Offer and acceptance, and Consideration all necessary to have a valid lease?

yup

Are licensees in PA permitted to engage in real estate in other states?

yup

Can a Tenancy in Common be created by operation of the law?

yup

Can a licensed salesperson sell condominiums?

yup

Do written documents affecting land need to be recorded in the county where the land is located?

yup

Does Actual Notice mean that not only is the information available, bu also that someone has been given the information and actually knows it?

yup

Does Extended Title insurance include all the standard benefits plus defects discoverable through the property inspection?

yup

Does Standard Title insurance include improperly delivered deeds?

yup

Does an abstract of title include the history of the title AFTER inspecting the county records for documents affecting the title?

yup

Does the Commercial Real Estate Broker Lien Act law enable licensed real estate brokers to file a lien for payment of services rendered and applies only to commercial real estate transactions?

yup

Does the Pro-Tenant Legislation Uniform Residential Landlord and Tenant Act give the landlord the right to enter the property, use and maintenance of the premises, tenant's protection against retaliation by the landlord for complaints, and disclosure of the property owners' (or manager's) names and addresses to the tenants.

yup

Does the State Real Estate Commission have the authority to promulgate the Rules and Regulations which elaborate on the license law and provide additional legal guidelines for PA licensees?

yup

Does the State of Frauds require ALL contracts be signed?

yup

Is a Veteran who is 100% disabled due to military service able to apply for property tax exemptions?

yup

Is a deed considered valid even if it is signed by an attorney-in-fact rather than the seller?

yup

Is a joint tenant free to convey interest in the jointly held property?

yup

Section 201 of the RELRA and 35.201 of the Regulations define a broker as an individual or entity (corp, partnership, or assoc) who, for another and for a fee, commission or other valuable consideration negotiates with or aids a person in locating or obtaining for purchase, lease or aquisition any interest in real estate and manages the real estate?

yup

The Rules and Regulations provide procedures for administering the law and set up operating guidelines for licensees. The Regulations havve the same force and effect as the law. Both the law and the Regulations are enforced through fines and the denial, suspension, or revocation of licenses. Does this law provide for civil and criminal actions to be brought against violators in serious cases?

yup

The license period for all real estate licensees currently begins June 1 and ends the last day of May in each even-numbered year (a two-year license period). When a license is first issued does it expire on the last day of May of the CURRENT license period?

yup

The seller conveyed a quitclaim deed to the buyer. Upon receipt of the deed, can the buyer be certain that the seller has no further claim to the property?

yup

There are two types of real estate taxes: general real estate taxes (ad valorem) and special assessments or improvement taxes. Are both levied against specific parcels of property and automatically become liens on those properties?

yup

To be eligible for recording in PA, a document must be in writing and properly executed (signed). Must the document be acknowledge before a notary pubic?

yup

UETA has 4 provisions: contract cannot be denied its legal effect just because its e-signed; cannot be denied its legal effect; is sufficient when state signatures are needed, and allows for state written documents to be e-signed. Is this intended to complement real estate transactions?

yup

Will probate court will distribute property held in severally by the deceased?

yup

yup

yup