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CA Real Estate Exam Vocabulary > CA REAL ESTATE EXAM FLASHCARDS > Flashcards

CA REAL ESTATE EXAM FLASHCARDS

When you're on the go or just need a quick vocab refresh while studying for the CA Real Estate Exam, these cards come in handy!

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1
Q

Reed vs. King

A

Pertains to death on a property. If a death occurred within 3 years, you must disclose the death & manner of death. The exception to this rule would be if the death occurred due to HIV or AIDS.

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2
Q

Jones vs. Mayer

A

Civil Rights Act of 1968. Prohibits racial discrimination in every private property transaction whether selling or leasing.

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3
Q

Easton vs. Strassburger

A

Pertains to disclosures. Every agent must conduct a reasonable competent, diligent, visual inspection of ACCESSIBLE areas for 1-4 unit single family homes. Seller must also disclose to 3rd parties. Does NOT replace any other inspection.

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4
Q

Transfer Disclosure Statement (TDS)

A

The form used to disclose.

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5
Q

Real Property

A

Land; Fixtures (attachments); Appurtenant (“runs with the land”); Immovable by law.

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6
Q

Chattel Real

A

…is PERSONAL property. Ex: Leasehold; Security Interest (mortgage or trust deed)

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7
Q

Mineral Rights

A

Refers to the right to remove substances from the land. Usually from beneath the surface.

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8
Q

Deed

A

Transfers the title to REAL ESTATE.

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9
Q

Bill of Sale

A

Transfers title to PERSONAL property.

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10
Q

M.A.R.I.A.

A

Method of attachment; Adaptability; Relationship of the parties; Intent of the parties; Agreement of the parties. Tests used by courts in determining whether or not something is a fixture. TIME & COST ARE NOT CONSIDERED in making this determination.

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11
Q

Interpleader

A

A legal action filed by ESCROW when parties disagree on whether something is a fixture.

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12
Q

Freehold Estates

A

Highest form of lad ownership and of indefinite duration

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13
Q

Holder

A

Owner of a LIFE ESTATE, as long as she is alive. A Holder CAN SELL or LEASE a life estate. Holder CANNOT WILL/DEVISE or COMMIT WASTE (fail to pay property tax; fail to maintain) with a life estate.

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14
Q

Creator

A

When a Holder/Owner of a LIFE ESTATE dies it reverts back to the Creator of the life estate.

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15
Q

Fee Simple Absolute

A

Highest & most complete form of land ownership.

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16
Q

Fee Simple Defeasible

A

Real Property subject to the power of termination.

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17
Q

Defeasible Estates

A

Subject to a condition. If condition is breached, there will be a forfeiture of the land or loss of title.

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18
Q

Life Estate

A

A freehold estate with limited duration based upon somebody’s life.

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19
Q

Estate in Reversion

A

Process by which the Holder in a LIFE ESTATE has died and the estate is going back to the Creator.

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20
Q

Encumbrances

A

Anything that would be a burden on the title. Two types: Money (liens); Non-money (easements).

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21
Q

Lien Priority

A

The earlier the lien is recorded, the more senior the lien is in priority.

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22
Q

Mechanics Lien

A

Liens against REAL property. Used to help secure payment for anybody providing: labor; services; materials or equipment. Effective when the WORK STARTED.

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23
Q

Liens

A

Money encumbrances that make property security for the payment of a debt or discharge of an obligation. Ex: Mechanics lien; Property tax lien; Mortgage

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24
Q

General Lien

A

A lien that affects both REAL and PERSONAL property. Ex: IRS; Judgements & attachments (seizes assets).

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25
Q

Voluntary Lien

A

A lien accepted freely. Ex: Mortgage.

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26
Q

Involuntary Lien

A

A lien that happens by operation of law. Ex: Property tax lien; Mechanics lien; IRS

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27
Q

Easement

A

The right to use the land of another for a particular purpose.

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28
Q

Dominant Tenement

A

Benefits from the easement.

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29
Q

Servient Tenement

A

Burdened by the easement.

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30
Q

Easement in Gross

A

Utility companies access property using this type of easement.

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31
Q

Prescriptive Easement

A

A HOSTILE easement.

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32
Q

N.A.C.H.O.

A

An easement will become a legal right is 5 things take place: Notorious; Adverse; Continuous for 5 years; Hostile; Open (not done in secret)

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33
Q

Title Vesting

A

Method or mode of holding title.

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34
Q

Prescriptive Easement (Termination)

A

Termination of a PRESCRIPTIVE easement can be done by either: Merger; Agreement (dominant signs a QUITCLAIM deed); Destruction; Non-Use for 5 years; Adverse Possession (going after property itself)

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35
Q

Ownership in Severalty

A

Ownership by one person or sole proprietorship.

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36
Q

Concurrent Ownership

A

Ownership by more than one person.

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37
Q

Joint Tenancy

A

Concurrent Ownership that includes 4 uniting factors: TIME (everyone has to sign at the same time); TITLE (everyone’s name is on the document); INTEREST (everyone gets equal share); POSSESSION (everyone gets use of the the entire structure). Property CANNOT be willed/devised due to RIGHT OF SURVIVORSHIP.

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38
Q

Tenancy in Common

A

Concurrent Ownership united by 1 factor: POSSESSION (everyone gets use of the entire structure). This type of vesting allows property to will/devised due to NO Right of Survivorship.

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39
Q

Community Property

A

Holdover from Spain. Property that is acquired during marriage.

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40
Q

Right of Survivorship

A

When one vested party in JOINT TENANCY dies, the other vested party(ies) gain the property interest of the party that died. Allows property to escape probate.

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41
Q

Separate Property

A

Property acquired prior to marriage either including by gift, will or inheritance. Also includes proceeds or income from separate property.

42
Q

Metes & Bounds

A

Land description. METES refers to distance. BOUNDS refer to natural & artificial markers. Used in extremely RURAL areas where NO tract map has been recorded.

43
Q

Topography

A

“Lay of the land”

44
Q

Principal Baselines

A

There are 3 baselines. They run EAST & WEST.

45
Q

Principal Meridian Lines

A

There are 3 meridian lines. They run NORTH & SOUTH. Starting points are: HUMBOLT; MT. DIABLO; SAN BERNARDINO.

46
Q

Sections in a Township

A

There are 36 sections; 36 square miles; 6 miles square.

47
Q

Lot & Block

A

The way we uniquely describe property that includes the Assessor’s Parcel Number (APN).

48
Q

Appropriation

A

Right of the government to collect water & distribute to all non-owners of the water.

49
Q

Eminent Domain

A

Power of the government to take private property for some PUBLIC USE paying Fair Market Value & just compensation.

50
Q

Condemnation

A

Process of government converting private property into a public use (typically by way of Eminent Domain).

51
Q

Inverse Condemnation

A

Homeowner forces the government to purchase their property because of something the government has done causing the homeowner to no longer enjoy their home.

52
Q

Zoning

A

A PUBLIC control. A comprehensive legal tool in executing the GENERAL PLAN.

53
Q

Variance

A

If a homeowner is placed at a disadvantage, she may file a variance.

54
Q

Conditional-Use Permit

A

Allows or permits a non-conforming use such as a church in a residential zone to exist.

55
Q

Grandfather Clause

A

A provision in a zoning ordinance that allows an existing use to continue, although non-conforming.

56
Q

CC&R’s

A

Covenants, Conditions & Restrictions. A PRIVATE control. Found or referenced in the DEED. Created by the developer. Are APPURTENANT to the land.

57
Q

Radon Gas

A

An environmental hazard proven to be colorless and odorless.

58
Q

Mass Spectrometer

A

Used to measure levels of radon gas.

59
Q

Police Power

A

Power of government to enact laws to promote Public Health, Public Safety & General Public Welfare. Ex: Zoning; a Real Estate License.

60
Q

Alquist-Priolo

A

Cover earthquakes. Seller must disclose. Applies to ALL counties in CA.

61
Q

Accretion

A

Accumulation of new soil on the property due to the action of water.

62
Q

Alluvium Soil

A

The new soil created by accretion.

63
Q

Accession

A

The increase in land ownership due to accretion.

64
Q

Avulsion

A

The violent tearing away of land by the action of water.

65
Q

Reliction

A

Water may permanently recede uncovering new land that was once under water.

66
Q

Riparian Rights

A

If property borders any type of water course such as a river or stream, property owner has the right to REASONABLE use.

67
Q

Littoral Rights

A

Right to reasonable use of lake or ocean that borders property.

68
Q

Potable Water

A

Water fit for consumption. A Potability Test is used to test water for consumability.

69
Q

Agent

A

Represents a PRINCIPAL in business dealings with 3rd parties. Principal an employer to the agent.

70
Q

Power of Attorney

A

Document that allows an agent to act on behalf of a principal. Also known as Attorney-in-fact. Do not need a Real Estate license to sell principal’s property with Power of Attorney in place. However, CANNOT deed or sell property to HIM/HERSELF.

71
Q

Estoppel

A

Stops one from later denying facts which that person once acknowledged were true & others accepted on good faith.

72
Q

Ratification

A

Principal agrees or ratifies conduct of an agent that was not previously authorized.

73
Q

Special Agent

A

When an agent is hired to a specific task.

74
Q

Dual Agency

A

Represents both principals. Must be disclosed.

75
Q

Fiduciary Duty

A

Highest, good faith and loyalty is owed to the PRINCIPAL; Honesty, fairness and disclosure (not loyalty) is owed to 3rd parties.

76
Q

Appraisal

A

Opinion or estimate of value. Valid for 1 day.

77
Q

Certified General

A

Highest license one can get as an appraiser. Can appraise any amount for both commercial and residential.

78
Q

Narrative Report

A

Most detailed appraisal report. Also known as a self-contained report.

79
Q

Short Report

A

Used by lenders. Also called a summary report.

80
Q

Cap Rate

A

Net Operating Income divided by the List Price = the CAP RATE. The higher the risk, the higher the cap rate.

81
Q

Value

A

Net Operation Income divided by the Cap Rate = the VALUE.

82
Q

Letter Report

A

Used when the client ifs familiar with the property. Also known as a Restricted Use Report.

83
Q

Sales Comparison Approach

A

Also known as Market Data Approach. Based on principle of Substitution. Works well with: Residential; Raw Land; Manufactured Homes; some Commercial.

84
Q

Cost Approach

A

Replace or Reproduce. This approach is used when there are no comparables and the property produces no income. Ex: New construction; unique buildings; Public buildings; Special purpose.

85
Q

Income Approach

A

Works well with large apartment complexes; retail; offices

86
Q

Replacement Cost

A

Building a building of the same utility.

87
Q

Reproduction Cost

A

Building an exact replica.

88
Q

Principle of Substitution

A

Value that tends to be decided by the cost of acquiring an equally desirable property.

89
Q

Principle of Conrtibution

A

A property improvement may or may not increase the property’s overall value market value, regardless of the cost of the improvement.

90
Q

Progression

A

The value of a building is enhanced if buildings around it have a higher value.

91
Q

Regression

A

A building’s value declines if the buildings around it have a lower value.

92
Q

Elements of Value

A

There are 4 elements that need to be present before a product has market value; Demand. Utility. Scarcity. Transfer (the ability to). (D.U.S.T.)

93
Q

Depreciation

A

A loss in value. There are 3 forms of depreciation; Functional, Economic, Physical.

94
Q

Functional Obsolescence

A

Inside the property line. Usually curable.

95
Q

Economic Obsolescence

A

External/outside of property. Incurable.

96
Q

Physical Obsolescence

A

Property damage, destruction. Wear and tear.

97
Q

Gross Rent Multiplier

A

It is a multiple of the rent as it relates to risk. Formula: Property value / Income.

98
Q

Non-Institutional Lenders

A

Mortgage Companies/Mortgage Bankers; Private Individuals; Mortgage Brokers

99
Q

Warehousing

A

Bundling up of loans. Mortgage companies will warehouse their loans and sell on the 2nd Market.

100
Q

Promissory Note

A

A.k.a. loan documents. The PROMISE to pay and the evidence of the DEBT. A negotiable instrument.

CA Real Estate Exam Vocabulary (1 decks)

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