National Real estate practice review
What is an encumbrance?
A defect on a title that can be monetary or physical
Lenders must deliver the Closing Disclosure at least ______ days before closing.
3
Investors who want to use the 1031 tax-deferred exchange must identify the new property within ___days of closing
45
The typical option period for contracts is
6 months
What's a township?
A 36-square-mile square formed in the use of the rectangular government survey system
Periodic estate
A periodic estate renews automatically at the end of the lease period.
Net operating income is determined by subtracting total operating expenses from the ___
Effective gross income
The lot and block system always begins with one of two types of land descriptions as a reference point:
Either a metes and bounds description or an RGSS (rectangular government survey system) description.
When a licensee has broad responsibility to handle all details of a specific transaction, what type of real estate agency relationship usually exists?
General
What purpose does bulk zoning serve?
It restricts the density of buildings in an area through practices like setbacks and open space requirements.
Which ownership type is defined by four unities: time, title, interest, and possession?
Joint tenancy
Purchase money mortgage
The term for seller financing typically used to bridge the gap between the buyer's available down payment and the institutional loan, though it can also be used to finance the entire purchase price.
Which of these can be defined as a lender charging a borrower more than the highest allowable interest rate?
Usury
Home Mortgage Disclosure Act
Which federal lending act requires financial institutions to fulfill their obligations to serve the housing needs of the communities and neighborhoods in which they're located?
The elements appraisers consider in the sales comparison approach are applied in a specific order
financing terms and cash equivalency, conditions of sale, market conditions at the time of contract and closing, location, and physical characteristics
An estate for years
has a fixed termination date
Which agreement terms is typically a standard part of the sales contract?
include specific closing instructions, the selection of a closing agent, agreement on specific documents that will be provided, and a statement about transferring warranties on built-in appliances and HVAC systems.
An appreciable asset
is something that will increase in value over time.
Rescission can be a(n) ______ agreement to cancel a contract
mutual
Duress
occurs when a threat is involved
Undue influence
occurs when persuasion overcomes another person's free will and judgment.
In strict liability, the ______ is responsible for cleanup, regardless of who created the initial problem.
owner
The Clayton Act supports the Sherman Antitrust Act's purpose of
prohibiting monopolies by prohibiting mergers or acquisitions that would create a monopoly.
Prepayment penalty disclosures must be made to the borrower, typically twice
when the borrower applies for the loan, and at least three days before the loan is granted.
Easement appurtenant
An easement created to benefit adjacent land.
Estate at will
An estate at will is a leasehold estate with an unknown duration.
What type of an eviction could tenants claim if they're forced to vacate an apartment after the landlord failed to repair the heat?
Constructive eviction
A trustee is holding title to Cassandra's house until the loan is paid in full. Which type of security instrument was used?
Deed of trust Three parties are involved when a deed of trust is used: the lender (beneficiary), the borrower (trustor), and a neutral third party (trustee)
Who can enforce an option contract?
Only an optionee (buyer) can enforce an option contract
Subdivision regulations imposed by developers in an effort to maintain control of the development of the subdivision are an example of ______.
Private land use control
Which of the following is an example of easement termination by merger?
The owner of a servient estate buys the property of the dominant estate
Which local land use group has the dual focus of livability and quality of life
The planning board has the dual focus of livability and quality of life.
A living trust differs from a testamentary trust in that a living trust is established to convey property as well as to
Transfer ownership before death and avoid probate A living trust avoids the entire probate process
functional obsolescence
a form of depreciation or loss in value caused by defects in design, such as an atypical floor plan.
periodic estate
automatically renewed at the end of the lease.
In both open listings and exclusive agency listings the seller
doesn't have to pay a listing agent commission if the seller finds a buyer herself.
Community Reinvestment Act
requires lenders to meet the needs of their communities by investing in development and rehabilitation efforts including those that enable low and moderate income neighborhoods meet the needs of the community.
Home Mortgage Disclosure Act
requires many financial institutions to publicly disclose information about mortgages, allowing public officials to make informed policy decisions and revealing potentially discriminatory lending patterns.
Capital gains fall into which stage of the property ownership life cycle?
reversion (sale) of property they own
Who is bound by the purchase agreement?
the parties, their heirs, personal representatives, successors, and assigns.
With a land contract
the seller agrees to provide credit to the buyer for a portion (or sometimes all) of the funds required to close the transaction. The buyer makes payments directly to the seller.
With exclusive agency,
the seller retains the right to sell and avoids paying the commission.
Metes and bounds
uses compass headings and directions.