Real Estate flashcards
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.
- Fixture
- An item of personal property that has become permanently attached to real property. Courts weigh attachment method, adaptation to the property, and the parties' intention.
- Joint tenancy
- Co-ownership with undivided equal shares, four unities (time, title, interest, possession), and the right of survivorship. One owner's death transfers the share to the survivors.
- Metes and bounds
- A legal description using a point of beginning, compass directions (courses), and measured distances to define boundaries, ending back at the point of beginning.
- Section acreage
- In the rectangular survey system, a section is one square mile, or 640 acres. A township contains 36 sections and measures six miles by six miles.
- Fiduciary duties
- Obedience, loyalty, confidentiality, accountability, and reasonable care and skill owed by an agent to a principal. Confidentiality continues after the agency relationship ends.
- Dual agency
- A single licensee representing both buyer and seller in a transaction. It requires informed written consent and limits the agent's ability to advocate for either party.
- Exclusive right to sell
- A listing agreement in which the broker earns a commission regardless of who procures the buyer, including the owner. It is the most common listing contract type.
- Agency by ratification
- An agency created when a principal approves a previously unauthorized act of a person who purported to act on the principal's behalf, giving it retroactive effect.
- Statute of Frauds
- A legal rule requiring real estate sale contracts and leases longer than one year to be in writing and signed by the party to be charged.
- Counteroffer
- A response to an offer that changes its terms. It operates as a rejection of the original offer and creates a new offer from the offeree.
- Liquidated damages
- A contract clause setting a predetermined amount payable on breach, commonly the earnest money. It must be a reasonable estimate, not a penalty.
- Novation
- Substitution of a new party or obligation for an existing one, extinguishing the original contract. It requires the consent of all parties.
- Loan-to-value ratio
- The loan amount divided by the property value or purchase price, whichever is lower, expressed as a percentage. It measures lender risk.
- Discount points
- Prepaid interest charged at closing to lower the note rate. One point equals one percent of the loan amount.
- PITI
- Principal, interest, taxes, and insurance, the four components of a standard monthly housing payment used in underwriting and affordability calculations.
- Regulation Z
- The rule implementing the Truth in Lending Act, requiring disclosure of the annual percentage rate and finance charges within three business days of application.
- Estate for years
- A leasehold with a fixed start and end date. It terminates automatically at the end date without notice to either party.
- Triple net lease
- A lease in which the tenant pays rent plus property taxes, insurance, and maintenance, shifting most operating costs to the tenant.
- Constructive eviction
- A landlord's failure to maintain habitable conditions that substantially interferes with the tenant's use, allowing the tenant to vacate and stop paying rent.
- Security deposit rules
- Landlords must often hold deposits in escrow, provide an itemized statement, and return unused funds within a statutory period, excluding normal wear and tear.
- Acre conversion
- One acre equals 43,560 square feet. To convert square feet to acres, divide the square footage by 43,560.
- Capitalization rate
- Net operating income divided by value. Value equals NOI divided by the cap rate; NOI excludes debt service and capital improvements.
- Gross rent multiplier
- Sale price divided by gross rent. It estimates value by multiplying a property's gross rent by the market-derived multiplier.
- Mill rate
- A property tax rate where one mill equals one dollar of tax per one thousand dollars of assessed value. Tax equals assessed value times rate.
- General warranty deed
- A deed containing five covenants: seisin, quiet enjoyment, further assurance, general warranty, and freedom from encumbrances, covering the entire chain of title.
- Quitclaim deed
- A deed that conveys whatever interest the grantor holds with no warranties. It offers the least protection to the grantee.
- Adverse possession
- Acquiring title by actual, open, notorious, exclusive, hostile, and continuous possession of another's land for the statutory period.
- Constructive notice
- Notice imputed by law from recorded documents in the public records, whether or not a party actually reviewed them.
- Variance
- Zoning relief granted when a property owner shows hardship from strict application of the ordinance. It is specific to the parcel, not a change of use.
- CERCLA liability
- The Superfund law imposing cleanup liability on current owners, past owners at disposal time, generators, and transporters of hazardous substances.
- Nonconforming use
- A use that existed lawfully before a zoning ordinance took effect and may continue despite no longer conforming to current zoning.
- Fair Housing Act classes
- The federal law prohibiting discrimination based on race, color, religion, sex, national origin, familial status, and disability in the sale or rental of housing.