IN Real Estate flashcards
IN Real Estate · Build recall with a focused review session.
32 cards. Read the term and the definition here. The deck at the top of this page is optional.
- Fee simple absolute
- The most complete ownership estate in real property; it lasts indefinitely, is freely inheritable, and is subject only to government powers and private restrictions.
- Joint tenancy
- Ownership by two or more persons with equal undivided interests and the right of survivorship, meaning a deceased co-owner's share passes to the surviving owners.
- Fixture
- An item of personal property that has become attached to real property and is treated as real property; tests include annexation, adaptation, and the parties' intent.
- Easement appurtenant
- An easement that benefits a dominant parcel and burdens a servient parcel; it runs with the land and transfers with the benefited property.
- Nonconforming use
- A land use that existed lawfully before a zoning ordinance was adopted and may continue despite not meeting current zoning rules, subject to local limits.
- Variance
- A zoning board's authorization allowing a property owner to depart from a dimensional or use requirement because strict application would cause unnecessary hardship.
- Eminent domain
- The government's power to take private property for public use, provided the owner receives just compensation as required by the Fifth Amendment.
- Fiduciary duty
- A legal obligation of trust owed by an agent to a principal, including loyalty, obedience, disclosure, confidentiality, accounting, and reasonable care.
- Dual agency
- A brokerage relationship in which one agent represents both buyer and seller in the same transaction; it requires informed written consent where state law permits it.
- Agency disclosure
- A required notice explaining whom a real estate licensee represents and the duties owed, typically provided before substantive discussions or before an offer.
- Confidentiality duty
- An agent's obligation not to reveal a principal's confidential information, such as motivation or financial limits, and it generally continues after the agency ends.
- Statute of Frauds
- A legal rule requiring certain contracts, including real estate sale and lease contracts over one year, to be in writing and signed to be enforceable.
- Counteroffer
- A response to an offer that changes its terms; it rejects the original offer and creates a new offer that the original offeror may accept or reject.
- Earnest money
- A good-faith deposit made by a buyer to show commitment to a real estate purchase; it is credited to the buyer at closing or handled per contract terms if default occurs.
- Contingency
- A contract condition that must be satisfied, such as financing, inspection, or appraisal, before the buyer or seller is obligated to complete the transaction.
- Mortgage
- A written instrument that pledges real property as security for a loan; the borrower retains ownership while the lender holds a lien or title interest depending on state law.
- Loan-to-value ratio
- The loan amount divided by the property's appraised value or purchase price, whichever is lower, expressed as a percentage; higher ratios increase lender risk.
- PITI
- The four typical monthly housing payment components: principal, interest, property taxes, and homeowners insurance; lenders use it to evaluate affordability.
- General warranty deed
- A deed in which the grantor warrants title against all defects, including those created by prior owners, and promises to defend the grantee's title.
- Recording
- Filing a deed or mortgage with the county recorder to give public notice of an interest in real property and to establish priority under state recording law.
- Title insurance
- An insurance policy protecting an owner or lender against covered title defects, such as undisclosed liens or errors, existing at the policy date.
- Sales comparison approach
- An appraisal method estimating value by comparing the subject property with recently sold similar properties and adjusting for differences in features, location, and condition.
- Capitalization rate
- A rate used in the income approach, calculated as net operating income divided by property value or price, to convert income into an estimated value.
- Highest and best use
- The reasonably probable, legal, physically possible, financially feasible, and maximally productive use of a property that produces the highest value.
- Lead-based paint disclosure
- A federal requirement for sales and leases of housing built before 1978 to disclose known lead hazards and provide the EPA pamphlet and opportunity for inspection.
- Fair Housing Act
- A federal law prohibiting discrimination in housing sales, rentals, and financing based on race, color, religion, sex, national origin, familial status, or disability.
- RESPA
- A federal law governing settlement practices for federally related mortgage loans; it requires certain disclosures and prohibits kickbacks and unearned fees.
- Commission formula
- The sales commission equals the sale price multiplied by the agreed commission rate; for example, a 6% rate on a $200,000 sale yields $12,000.
- Acre conversion
- One acre equals 43,560 square feet; one square mile equals 640 acres, and one section of land equals one square mile.
- Net operating income
- Effective gross income minus operating expenses, excluding debt service and income taxes; it is the numerator in the direct capitalization formula.
- Indiana Real Estate Commission
- The state body that regulates real estate brokers and managing brokers in Indiana, adopts licensing rules, and hears disciplinary matters through the Professional Licensing Agency.
- Commingling
- Mixing client funds with a licensee's personal or business funds; it is prohibited, and trust funds must be handled through a proper escrow or trust account.