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Broker II Flashcards

1
Q

Valid Contract requirements

A

Offer and contract
Consideration
Legally competent parties
Voluntary

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2
Q

Statute of Frauds

A

Must be in writing

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3
Q

Novation

A

Contract substituted for another

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4
Q

Escalator offer

A

Person will top an existing offer up to a certain price

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5
Q

PMI Loans

A

Private Mortgage Insurance- less than 20% down

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6
Q

When can someone terminate PMI

A

when principal balance reaches 78%

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7
Q

How much are loan origination fees

A

1-3%

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8
Q

Defeasance clause

A

immediately release full title when loan is paid in full

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9
Q

FHA borrowers min down payment

A

3.5%

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10
Q

Deed of trust participants

A

trustor(borrower)
beneficiary (lender)
trustee (holds deed)

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11
Q

Deed of trust definition

A

primary security instrument

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12
Q

Universal agent

A

authority to act for principal
someone w POA

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13
Q

General agent

A

handles all dealing in a specific area for a client: real estate or escrow

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14
Q

Single license dual agency

A

Licensee reps both buyer and seller in a single transaction

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15
Q

Designated agency/ dual license dual agency

A

2 separate licensees from a single firm represent a party in the same transaction
impossible to provide loyalty
or full disclosure

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16
Q

Sub agency

A

Unrepresented buyer to a transaction

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17
Q

express agency

A

Agency understood and agreed to
spoken or written

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18
Q

Implied agency

A

Avoid!

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19
Q

Ratification

A

Acceptance after the fact-
signing paperwork
or parties actions

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20
Q

Estoppel

A

prevents parties from suing each other
Actions or statements have implied a certain agreement

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21
Q

Agency

A

created solely through agreement

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22
Q

Exclusive agency

A

one brokerage market and sells property

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23
Q

Exclusive right to Sell

A

listing agent w commission
*start and end dates

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24
Q

Open Listing

A

Seller can work w multiple agents
Agent who brings successful buyer will be paid

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25
Net Listing
Broker contract w seller to receive all net proceeds above a specific price -Illegal in most jurisdictions -conflict of interest
26
listing contracts basics
1-written or oral 2-protection 3-almost always require date 4-outline duties 5-confidentiality 6-disclosure 7-obligations 8-present offers
27
Marketing listing - must provide
Specify: 1-MLS 2-Internet 3-Yard signage
28
Open buyer representation
Allow buyer to work w many agents can enter into an exclusive w anyone and open agreements are terminated -addresses compensation -parties obligations -general description -buyers duties
29
Non agency
provides non agency assistance
30
POA
grants rights and powers from one person (principal) to another (agent) -special and general POA -terminates on death -or divorce
31
Different ways to contract Termination
expiration completion force of law destruction of property or death mutual agreement
32
Revocation
lack of trust
33
Post agreement client/licensee relationship
confidentiality extends
34
Agency Duties
1-act in principals best interest 2-dislose 3-disclose profit 4-reasonable skill 5-care for property received 6-obedience 7-consent
35
Specific Duties- are general
-seek price and terms acceptable -show properties -present offers -copies
36
Fiduciary Duties OLD CAR
Obedience Loyalty Disclosure Confidentiality Accounting Reasonable skill and care -Confidentiality and Accounting don't end
37
Agent duty to customer
-Honesty -integrity -cooperation -disclosure -Fairness -Accounting
38
Disclosure
status -interest -Agency and interest end at sale of property -death of principal doesn't void agency
39
Eminent Domain
govt takes private land for public use fairly compensate owners
40
Taking
govt appropriation
41
Escheat
-takes property of descendent without will, heirs or creditors -benefits public
42
Sunshine Act
FOIA Freedom of Information Act
43
FEMA
researches areas that are risky for flooding
44
Brownfield Act
provides funds for cleaning brown fields
45
Deed restriction
can have time limit or not
46
CCR
HOA or developer expires member of HOA can pursue enforcement in civil law court
47
Prop manager
general agent w license
48
Types of Leases
-Estate at sufferance -estate at will- unknown date -estate for years- terminates at specific date -periodic estate- auto renewal period to period
49
Sherman Act
prevent monopolies
50
Clayton Act
supports Sherman Act- prohibits mergers
51
FTC
investigates antitrust/penalizes violaters
52
Property Disclosures- MAAP
Material Adverse Actual Physical
53
Carpenter ants generate
Frass
54
General warranty Deed
greatest warranty to buyers 6 covenants:
55
Present warranties
Seisin Right to Convey Against Encumbrances
56
Future Warranties
Quiet enjoyment Further assurances Warranty forever
57
Bargain and Sale deed
owner has right to convey no other warranties
58
Executors Deed
convey property from a decendents estate
59
Sheriff Deed
convey foreclosed property
60
Deed in Trust or of Trust
conveys real estate to a trustee for the beneficiary named in the trust
61
TRID required settlement statement
Closing Disclosure CD
62
RESPA
LE 3 days before loan app and CD
63
Closing Disclosure
minimum of 3 days before closing
64
Possible Closing Costs
-Loan fees -appraisal and survey -title insurance -legal fees -real estate commissions -tax and insurance prepayments -transfer fees
65
FIRPTA- foreign investment real property tax act
Withhold 15% of gross sales at closing Buyer responsible Closing Agent handles withholding
66
person under FIRPTA
not a resident alien/ green card holder not a US citizen
67
Home warranty
system or appliance problems after home is purchased
68
Home construction warranty
structural issues workmanship system/appliances 10 yr
69
FHA/VA loans required for new homes
warrantor agrees to pay for covered defects 1 year finished construction date or title conveyance
70
Acceleration clause
entire loan due immediately
71
Deficiency Judgement
borrower pays shortage due at foreclosure sale
72
Short sale
Redemption may allow to buy back after foreclosure- not with short sale Lengthy closing process
73
Probate
distributing deceased person estate
74
FIRREA
1898 appraisals state certified/licensed appraisers
75
FHA insured loan
-appraised by state licensed appraiser -approved by HUD
76
VA loan
VA certified appraiser
77
Appraiser Independence Requirements AIR
Accurate, unbiased value
78
Approaches to Value
Sales Comp Cost Income
79
Appraisal Process
Reconciliation process
80
4 Characteristics of Value
DUST: demand utility scarcity transferability
81
Other values
Value in use Assessed value Mortgage value Insured value Investment value
82
Economic Principles of Value-9
Conformity- conform to neighboring properties Competition- value in comparison to competitive props Substitution- value assessed via comparison of other similar props Contribution- does it add value to area Plottage- combining plots Assemblage- Regression- is value decreased by nearby properties Progression- is value increased by nearby properties Anticipation- future development of change in value affecting property
83
Sales Comparison
most commonly used- Elements Units
84
Cost approach
sum of value of land and improvements on land
85
Income Approach
Income from property
86
Gross rent Multiplier- GRM
4 or less units GRM= sales price/gross monthly rent
87
Gross Income Mult
5 + units GIM= sale price/gross annual income
88
Cap Rate
annual rate of return I/V=R I=R x V Annual
89

Broker (5 decks)

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