NM Real Estate flashcards
NM 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: perpetual, inheritable, and freely transferable, subject only to government powers such as taxation, eminent domain, police power, and escheat.
- Fixture
- A former item of personal property that has become real property because it is annexed to the land, adapted to the property's use, and intended to remain permanently, so it transfers with the realty.
- Trade fixture
- Personal property installed by a commercial tenant for business purposes; it stays the tenant's property and is removable before the lease ends if removal does not cause substantial damage.
- Easement appurtenant
- An easement that benefits a neighboring parcel, the dominant tenement, and burdens the servient parcel; it runs with the land and passes automatically when either parcel is transferred.
- Tenancy in common
- Co-ownership in which each owner holds a separate undivided interest that may be unequal, may be conveyed or devised individually, and carries no right of survivorship.
- Joint tenancy
- Co-ownership by two or more persons with equal undivided interests, unity of title, time, interest, and possession, plus a right of survivorship that passes the whole to the survivors.
- Exclusive right to sell
- A listing agreement under which the broker earns a commission no matter who procures the buyer, including the seller, making it the broadest and most broker-favored listing.
- Qualifying broker
- The licensed broker who holds the brokerage license, supervises associate brokers and staff, and is responsible to the New Mexico Real Estate Commission for the brokerage's compliance.
- Associate broker
- A New Mexico licensee who holds a broker license but works under a qualifying broker's brokerage; New Mexico licenses brokers rather than salespersons for individual licensees.
- Trust account
- A separate bank account used to hold client funds such as earnest money and rents; mixing these funds with the broker's operating or personal money is prohibited.
- Commingling
- Illegally mixing client trust funds with the broker's personal or operating money, or failing to deposit earnest money promptly into the designated trust account.
- Gross receipts tax
- New Mexico's business tax imposed on gross receipts from services, including real estate brokerage commissions; New Mexico has no general state sales tax on goods.
- License renewal cycle
- New Mexico real estate licenses renew on a three-year cycle, and licensees must complete required continuing education and pay renewal fees to keep the license active.
- Fiduciary duty of loyalty
- A licensee must place the principal's interests above all others, avoid self-dealing, and disclose any personal interest in the transaction or referral compensation before acting.
- Confidentiality duty
- A licensee may not reveal the principal's confidential information, such as motivation or top price, and this duty continues after the brokerage relationship ends.
- Brokerage relationship disclosure
- A written notice required in New Mexico identifying whom the licensee represents and which types of brokerage relationships are available, given before or when services begin.
- Transaction broker
- A New Mexico brokerage role in which the licensee assists both buyer and seller without being the agent of either, owing honesty, disclosure of known material facts, accounting, and confidentiality.
- Dual agency consent
- Acting as agent for both buyer and seller in one transaction; because duties conflict, it requires full written disclosure and the informed written consent of both parties.
- Material adverse fact
- A fact about the property or transaction known to the licensee that could affect a party's decision or the property's value; it must be disclosed even if it hurts the client.
- Statute of frauds
- A legal rule requiring real estate contracts and deeds to be in writing, signed by the party to be charged, and to identify the parties, the property, and the price.
- Counteroffer
- A response that changes the terms of an offer; it operates as a rejection of the original offer and creates a new offer the other party may accept or reject.
- Earnest money
- A good-faith deposit by the buyer, held in the broker's trust account and credited to the buyer at closing; the contract states who keeps it if the buyer defaults.
- General warranty deed
- A deed containing present and future covenants of seisin, quiet enjoyment, warranty, and further assurances, by which the grantor warrants title against all claims, including earlier ones.
- Quitclaim deed
- A conveyance that transfers only whatever interest the grantor may have, with no warranties of title and no guarantee that the grantor owns any interest at all.
- Constructive notice
- Notice given by recording a document with the county clerk; once recorded, the world is legally presumed to know its contents, protecting later purchasers and lenders.
- Community property
- New Mexico is a community property state; property acquired during marriage is generally owned equally, and both spouses normally must join to convey community real estate.
- Loan-to-value ratio
- The loan amount divided by the lesser of the purchase price or appraised value, expressed as a percentage; lenders use it to set loan limits and mortgage insurance.
- Discount point
- A fee equal to 1 percent of the loan amount paid at closing to obtain a lower interest rate; more points mean a lower rate and higher upfront cost.
- PITI
- The total monthly housing payment made up of principal, interest, property taxes, and hazard insurance, with taxes and insurance often held in an escrow or impound account.
- Capitalization rate
- Net operating income divided by property value; it is also used to estimate value by dividing net operating income by a market-derived rate.
- Gross rent multiplier
- Sale price divided by gross monthly rent; a quick income-approach check for comparable rental properties when expenses are not separately analyzed.
- Acre
- A unit of land area equal to 43,560 square feet, roughly 208.7 feet on each side; one section of land contains 640 acres.