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Real Estate > Chapter 10: Leases > Flashcards

Chapter 10: Leases Flashcards

1
Q

What does a sublease consist of?

A

The original tenant (sublessor) transfers less than the entire remaining leasehold estate to the sublessee

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2
Q

What is a sandwich lease?

A

the original tenant. is the lessee in the main lease and the lessor in the sublease

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3
Q

What is an option to renew?

A

Gives the tenant the right to extend the lease for another term

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4
Q

What is an option to buy?

A

Gives tenant the right to buy at set price within a designated period of time

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5
Q

What are the 7 types of leases ?

A

Gross lease, net lease, net lease, graduate lease, reappraisal lease, percentage lease, ground lease, and sale leaseback

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6
Q

What is the right of refusal?

A

does not obligate landlord to self, but must offer to tenant before anyone else.

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7
Q

What is gross lease?

A

AKA Flat lease, tenant pays rent to landlord, they use it to pay property taxes, insurance premium, repair/maintenance.

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8
Q

What is a net lease?

A

Tenant pays a fixed rental plus all operating expenses.

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9
Q

What is an escalator clause in a graduated lease?

A

The landlord in in a long term lease acquires some necessary protection against rising costs & inflation.

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10
Q

What is a step up lease?

A

Provides rent increases in predetermined amounts

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11
Q

What is an index lease?

A

Periodic rent adjustment based on changes in economic index.

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12
Q

What is an escalator lease?

A

Rent increases are tied to operating cost

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13
Q

What is an reappraisal lease?

A

Provides the rents to be reappraised at certain intervals

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14
Q

What is a percentage lease?

A

Tenant pays a fixed minimum(base rent) plus percentage of gross sales/profits.

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15
Q

What is a ground lease?

A

Rental for unimproved land with permission granted to the tenant to construct building or make improvements at tenant’s expense.

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16
Q

what is a sale leaseback

A

The owner sells property to an investor with an agreement to lease it back on a long term net lease

17
Q

What is the role of officers and directors?

A

Operating and conducting business affairs of association. of all owners

18
Q

What is the Role of community association manager?

A

Serves as buffer between directors and the owners

19
Q

What does fidelity insurance cover?

A

The broke, partners, officers, affiliates, employees and anyone handling funds.

20
Q

What is a leasehold estate?

A

less than freehold interest, known as tenancy

21
Q

What is a leased fee estate?

A

entitling the lessor (landlord) to receive rental payments from tenant

22
Q

What are the 4 types of leasehold estates?

A

estate for years, estate from period to period, estate at will, estate at sufferance

23
Q

What does estate for years (tenancy for years) consist of?

A

tenant has exclusive possession and use of property

24
Q

What does estate from period to period(periodic tenancy) consist of?

A

rights are transferred from period covered by rent and automatically renewed every time rent is paid

25
Q

What does estate at will (tenancy at will) consist of?

A

landlord allows tenant to occupy property for uncertain time

26
Q

What does estate at sufferance (tenancy at sufferance) consist of?

A

when tenant stays over for longer than lease agreement (holdover tenant)

27
Q

what are the 9 requirements for a valid lease?

A

legally competent, mutual agreement, genuine assent, consideration, lawful purpose, in writing, description of premises, lease term, signature-delivery-acceptance

28
Q

what sis a subordination clause?

A

the tenant’s rights have no priority over any loan whether arranged before or after lease was signed

29
Q

What is a non-disturbance agreement?

A

lender promises not to cancel any leases in the event of a foreclosure

30
Q

What does subdivision with no governing homeowner association consist of?

A

protection of covenants but no obligation to pay assessments. owners take violates of covenants amongst themselves

31
Q

What does subdivision with voluntary homeowner association consist of?

A

owners can elect not to join association. association has obligation to enforce covenants

32
Q

What does subdivision with mandatory homeowner association consist of?

A

association can ensure facilities are maintained and covenants enforced. They can levy assessment against owners

33
Q

What is the GA Property owners association act?

A

provides the option to submit a statutory scheme of development that provides significant collection and enforcement powers

Real Estate (13 decks)

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