Licensed Real Estate Agent Exam key terms

Sole ownership of real property by one person or one legal entity, with no other co-owners holding an interest in the title.

Concurrent ownership in which each co-owner holds an undivided fractional share, may sell or devise that share, and has no right of survivorship.

Concurrent ownership with the four unities of time, title, interest, and possession, plus a right of survivorship that passes a deceased co-owner's share to the survivors.

Feature of joint tenancy and tenancy by the entirety under which a deceased co-owner's interest automatically transfers to the remaining co-owners instead of passing through probate.

A form of co-ownership available only to married couples in some states, featuring survivorship and protection against one spouse's individual creditors.

A right to use a neighboring parcel that benefits the dominant parcel and burdens the servient parcel, passing automatically when either parcel is transferred.

A personal right to use another's land that benefits a specific holder rather than a parcel, such as a utility easement, and is generally not transferable with land.

Any claim, lien, easement, restriction, or other burden on title that may diminish value or limit use but does not necessarily prevent transfer of ownership.

The ranking that determines which lienholder gets paid first from sale proceeds, usually by recording date, with property tax liens and certain others often taking statutory precedence.

A doctrine letting a person gain title to land by open, notorious, hostile, continuous, and exclusive possession for the statutory period, sometimes with payment of taxes.

The legal obligation of an agent to act in the principal's best interest, encompassing loyalty, obedience, disclosure, confidentiality, accounting, and reasonable care and skill.

A consensual arrangement in which a principal authorizes an agent to act on the principal's behalf, creating fiduciary duties and potential liability for the agent's acts.

Representation of both buyer and seller, or both landlord and tenant, in the same transaction, permitted only with informed written consent where state law allows it.

A brokerage practice in which different licensees within one firm are assigned to represent opposing parties, with confidential information shielded between them under state rules.

The uninterrupted series of efforts that leads to a completed transaction, used to decide which broker is entitled to a commission when more than one is involved.

A listing agreement entitling the broker to a commission regardless of who procures the buyer, including when the owner sells the property personally during the listing term.

A listing arrangement where the broker's compensation is any amount received above a seller-specified minimum price; many states prohibit or tightly restrict it as a conflict of interest.

An agreement in which a seller grants a buyer the exclusive right to purchase property at set terms within a stated period in exchange for consideration.

A contract condition that must be satisfied, such as financing, inspection, or appraisal, before the transaction proceeds; failure may allow cancellation and return of the deposit.

Funds a buyer delivers on signing to show good faith, typically held in trust and applied to the purchase price or forfeited under stated default terms.

A neutral third party's holding of funds and documents until all conditions are met, then disbursing them according to the parties' written instructions.

A closing document itemizing debits and credits to buyer and seller, including loan charges, prorations, commissions, and payoff amounts, showing funds due at closing.

The division of an expense or income item, such as taxes, rent, or interest, between buyer and seller based on the number of days each owns the property in the period.

The loan amount divided by the property's appraised value or purchase price, whichever is lower, used to gauge risk and set mortgage insurance requirements.

Coverage protecting a lender against borrower default, usually required when the loan-to-value ratio exceeds 80 percent and cancelable under federal disclosure rules.

The scheduled repayment of a loan through periodic payments that cover interest first and then principal, with the principal portion growing over the loan term.

A loan whose interest rate changes on a set schedule based on an index plus a margin, subject to periodic and lifetime caps and required consumer disclosures.

A federally required statement showing the annual percentage rate, finance charge, amount financed, and total payments so borrowers can compare credit costs.

A licensee's analysis of recently sold, pending, and active comparable properties, adjusted for differences, to estimate a probable listing or sale price.

A valuation method that estimates value by adjusting prices of similar sold properties for differences in location, size, condition, features, and date of sale.

The legally permissible, physically possible, financially feasible use that produces the greatest value to the land, a standard assumption in appraisals and site analysis.

An administrative exception allowing an owner to depart from a zoning rule because of unique hardship of the parcel, granted without changing the underlying zoning district.

A use that lawfully existed before a zoning ordinance took effect and may continue despite no longer matching current district rules, often with limits on expansion.

A group shielded from discrimination by fair housing law, including race, color, religion, sex, national origin, familial status, and disability under federal statutes.

Directing prospective buyers or tenants toward or away from neighborhoods based on protected characteristics, a prohibited practice even when done without explicit statements.

Inducing owners to sell by suggesting that members of a protected class are moving into the area and will lower property values, an illegal and unethical practice.

A change in rules, policies, practices, or services, or permission for a physical modification, needed so a person with a disability can use and enjoy housing.

Mixing client or tenant funds with a licensee's personal or business funds, generally prohibited; related conversion is the actual misuse of trust funds.

Professional liability coverage protecting licensees and firms against claims of negligence or mistakes in real estate services, distinct from general business insurance.

Tenant funds held to cover unpaid rent or damage beyond normal wear, subject to state limits on amount, separate account rules, and return deadlines.