Exam Question Master 2

Acre

43,560 square feet

Defeasance Clause

A provision in a mortgage that specifies the terms and conditions to be met in order to avoid default and thereby defeat the mortgage.

Conventional Loan

A real estate loan that is neither FHA-insured nor VA-guaranteed

Easement by Prescription

A right acquired by an adverse user to use the land of another, created through a court of law after long and uninterrupted use.

Gross Income Multiplier (GIM)

A rule of thumb for estimating the market value of commercial and industrial properties; the ratio to convert annual income into market value.

Condominium Documents

A set of papers describing the condominium and the association.

Balloon Payment

A single, large payment made at the maturity of a partially amortized mortgage to pay off the debt in full.

Buffer Zone

A strip of land separating one land use from another.

Chain of Title

A successive listing of all previous holders of titles (owners) back to an acceptable starting point.

Estate by the Entireties

A tenancy created by husband and wife jointly owning real property with instant and complete right of survivorship.

Estate for Years

A tenancy measured from a starting date to termination date (may be for a few days or longer than any natural life; e.g. a leasehold is an estate for years.)

Deed

A type of conveyance; a written instrument to transfer title to real property from one party to another.

Bargain and Sale Deed

A type of deed in which title is transferred and limited number of warranties are made respecting title to or use of the property.

Easement in Gross

A type of easement that benefits an individual or business entity and is not related to a specific adjacent parcel, for example, utility easements.

Earnest Money

A type of money that a broker may handle for others in the ordinary course of business;also called a good-faith deposit or binder deposit.

Brokers Price Opinion (BPO)

A written opinion of the value of real property. Florida real estate licensees are allowed to prepare and charge for BPOs provided the BPO is not called an appraisal. Price opinions are often requested by relocation companies and lenders involved in short sales of distressed properties.

Estoppel Certificate

A written statement that bars the signer from making a claim inconsistent with the instrument ( commonly used with a mortgage assumption).

As valorem

According to the value; in proportion to worth.

Comparative Market Analysis (CMA)

An informed estimate of market value performed by a real estate licensee for the seller to assist in arriving at an appropriate listing price, or it working with the buyer, an informal estimate of market value to assist the buyer in arriving at an appropriate offering price.

Fannie Mae

An institution in the secondary mortgage market that buys and sells mortgages.

Abstract of Title

Condensed history of title to real property consisting of a summary of the links I the "chain of title" extracted from documents bearing on the title status.

At Arms Length

Conducting negotiations on ones own behalf without being subject to the other party's control or influence.

Deposit

Earnest money or some other valuable consideration given as evidence of good faith to accompany an offer to purchase or rent. (Binder deposit, earnest money deposit)

Freddie Mac

Formerly called the Federal Home Loan Mortgage Corporation (FHLMC). A secondary mortgage market institution that buys and sells conventional, FHA, and VA loans.

Erosion

Gradual loss of land due to water or other natural causes.

Base Line

Imaginary lines running east to west and crossing a principal meridian at a definite point; used by surveyors for reference in location and describing land under the government survey system.

Air Rights

The freedom to use the open space above a property.

Blockbusting

The illegal practice of inducing homeowners to sell their property by making misrepresentations regarding the entry or prospective entry of minority persons in order to cause a turnover of properties in the neighborhood; discriminatory acts against sellers.

Assessment

The imposition of tax or charge according to a preset rate; the allocation of he proportionate individual share of a common expense in a condo or co-op building.

Alluvion (Alluvium)

The increase of land by the gradual and imperceptible action of natural forces(e.g., deposits of sand and mud on a riverbank).

Declaration of Condominium

The legal document that the developer of a condominium must file and record in order to create a condominium under state law.

Equity

The market value of a property less any debt against it; in a business entity, assets minus liabilities equals capital (owners equity); a system of legal rules administered by a court of chancery.

Fee Simple Estate

The most comprehensive and complete interest one can hold in real property; freehold estate. Also called fee or fee simple absolute.

Curable

When the correction of a defect results in as much added value as the cost to correct the defect.

Concurrent Ownership

When two or more persons own property at the same time, such as joint tenants, tenants by the entirety, or tenants in common.

Culpable Negligence

Inadequate attention to duties and obligations by those who know, or should know, what is required of them.

Federal Housing Administration (FHA)

Insures mortgage loans made by FHA-approved lenders on homes that meet FHA standards in order to make mortgages more desirable investments for lenders.

Caveat Emptor

Latin for "let the buyer beware."

Green Belt Law

Legislation that authorizes county property appraisers to asses land used for agricultural land.

Blanket Mortgage

One debt instrument covering two or more parcels.

Devisor

One who gives real property through a will.

Attorney-in-fact

One who is authorized to perform certain acts for another under a power of attorney.

Devisee

One who receives real property under a will.

Customer

One with whom the broker or sales associate hopes to be successful in accomplishing the purpose of employment. Per section 475.01, F.S., a member of the public who is or may be a buyer or a seller of real property and may or may not be represented by a real estate licensee in an authorized brokerage relationship.

Grantor

Party who signs and gives a deed; seller.

Deed Restrictions

Provision in a mortgage that specifies the terms and conditions to be met in order to avoid default and thereby defeat the mortgage.

Business Broker

Real estate licensees who engage in the sale, purchase, or lease of businesses.

Escheat

Reversion of property to the state when an owner dies without leaving a will or any known heirs.

Antitrust Laws

State and federal laws designed to maintain and preserve business competition.

Acceleration Clause

Stipulation in a mortgage that the entire unpaid balance of the debt may become due and payable if a default of expressed conditions should occur.

Arbitration

The act of having a third party tender a binding decision in a disposition between two parties.

Alienation

The act of transferring ownership, title, or an interest or estate in real property.

Effective Age

The age indicated by a structured condition and utility.

Discount Rate

The amount of interest the Federal Reserve charged to lend money to its eligible banks.

Administrative Law

The body of law created by administrative agencies in the form of rules, regulations, orders, and decisions.

Capital

The collective wealth (money and property) of a person or burdened; the investment in a property.

Assemblage

The combining of two of more adjoining properties into one tract.

Eminent Domain

The constitutional right given to a unit of government to take private property involuntarily, if taken for public use and fair price is paid to the owner.

Familial Status

A protected class as defined in the Fair Housing Act, consisting of one or more individuals under age 18 living with a parent or legal guardian and pregnant women.

Concurrency

A provision in Florida's Growth Policy Act that requires water and waste treatment facilities needed to support additional population to be in place before new development is allowed.

Branch Office

A business location other than the real estate brokers principal place of business.

Escrow Disbursement Order (EDO)

A course of action for determining the disposition of a contested deposit.

Active license

A current, valid license registered with the DPBR. The status required to actively engage in the real estate business.

Due-on-Sale Clause

A provision in a conventional mortgage that entitles the lender to require the entire loan balance to be paid in full if the property is sold.

Civil Rights Act of 1866

A federal act that prohibits any type of discrimination based on race in any real estate transaction (sale or rental) without exception.

Federal Deposit Insurance Corporation (FDIC)

A federal agency that insures deposits of member banks and savings associations.

Ginnie Mae

A federal agency that is party of the Department of Housing and Urban Development (HUD). Ginnie Mae plays an important role in achieving the HUD's goal of served sectors of the housing market.

Convertible Mortgage

A financing instrument allowing a change from an adjustable-rate to a fixed-rate Mortgage.

Adjustable-rate mortgage (ARM)

A financing technique in which the lender can raise or lower the interest rate according to a set index.

Contract for Deed (land contract)

A financing technique wherein the seller agrees to deliver the deed at some future date and the buyer takes possession while paying the agreed amount. Also called an installment sale contract or agreement for deed.

Deed and n Lieu of Forclosure

A friendly foreclosure (non-judicial procedure) in which the mortgagor gives title to the mortgagee.

Devise

A gift of real property by a will.

Assignment of Mortgage

A legal instrument stating that the mortgagee assigns (transfers) the mortgage and promissory note to the purchaser.

Cease to be in Force

A licensee can not perform real estate services because certain events occur, such as when a broker changes business address.

Adverse Possession

A method of obtaining title to real property by occupying it in an open and hostile manner contrary to the interests of the owner.

Asbestos

A mineral fiber used until 1978 in a variety of building construction materials for insulation and as a fire retardant.

Condominium

A multi unit project consisting of individual ownership of a dwelling unit and undivided ownership of common areas.

Cooperative

A multiunit project consisting of individual dwelling units owned by the corporation in which the individual apartment tenants own stock rather than owning their respective units.

Fiduciary

A person in a position of trust and confidence with respect to another person.

Estoppel

A principle of law that prohibits (stops) people from defending themselves against their own acts or lack of action.

Doc Stamps

An abbreviated term for documentary stamp tax.

Fair Housing Act

An act contained in Title VIII of the Civil Rights Act of 1968 that created protected classes of people and prohibits discrimination when selling or renting residential property when based on race, color, religion, sex, National origin, familial status, or handicap status.

Blind Advertisement

An advertisement that provides only a telephone number, a post office box, and/or an address without the licensed name of the brokerage firm.

Gross Lease

An agreement for the tenant to pay a fixed (base) rent with the landlord paying all the expenses associated with the property.

Bilateral Contract

An agreement wherein both parties are legally obligated to each other to perform.

Corporation Sole

An artificial or fictitious person formed by an ecclesiastical body (Church)

Corporation

An artificial or fictitious person formed to conduct specified types of business activities.

Administrative Law Judge

An attorney employed by the Division of Administrative Hearings, Department of Administration, to hear complaints and issue recommended orders.

Easement by Necessity

An easement created by a court of law in cases where justice and necessity dictate it, such as when property is landlocked.

Fixture

An object that was once considered personal property but has become real property because of attachment to, or use in, improvements to real property.

Cloud on Title

Any defect, valid claim, or encumbrance that serves to impair the title or curtail on owner's rights.

Debit

As a verb, to make an entry on the left or charge side of an account; as a noun, a charge or expense.

Commingle

To mix together money or a deposit with personal funds; combine; intermingle.

Common Elements

The parts of a multiple-ownership property not included on the units; those parts in which each unit owner holds an undivided interest.

Capital Gain (or Loss)

The profit (or loss) from the sale of an asset, including real property.

Buyers Market

The supply of available properties exceeds the demand.

Going-Concern Value

The worth of a business, including real estate, goodwill, and earning capacity.

Designated Sale Associates

Two real estate licensees designated to represent the buyer and the seller as single agents in a nonresidential transaction. The buyer and the seller must have assets of $1 million or more and sign disclosures stating that their assets meet the required threshold.

Encroachment

Unauthorized use of another person's property.

Follow-up

What's sales associate does after a sale to maintain customer contact and goodwill.