KEY VOCABULARY WORDS:

Question 1

Bundle of Rights

Answer 1

Legal rights of the real estate title holder. Includes the right of possession, the right of control, the right of exclusion, the right of enjoyment and the right of disposition.

Question 2

Real Property

Answer 2

Generally immovable. Goes with the real estate.

Question 3

Personal Property

Answer 3

Generally movable. Goes with the person. Personal property can be hypothecated, alienated and become real property (a fixture).

Question 4

Chattel Real

Answer 4

Often merely refers to tangible movable personal property.

Question 5

Fixture

Answer 5

Personal property that is now real property- for example, a pool covering or a painting that has been nailed to the wall. The acronym MARIA is a test for whether or not something is a fixture (Method Adaptability Relationship Intention Agreement).

Question 6

Trade Fixture

Answer 6

Personal property that is now real property- for example, a pool covering or a painting that has been nailed to the wall. The acronym MARIA is a test for whether or not something is a fixture (Method Adaptability Relationship Intention Agreement).

Question 7

Riparian Rights

Answer 7

Water rights over a moving body of water- for example, a river or a stream.

Question 8

Littoral Rights

Answer 8

Land which abuts a body of static water- for example, a lake, sea or ocean.

Question 9

Accretion

Answer 9

An increase in actual land due to natural causes- for example, from the gradual action of the ocean or river waters.

Question 10

Avulsion

Answer 10

Land is washed away by water- for example, a dam breaks and the rushing water washes away a strip of land.

Question 11

Reliction

Answer 11

Gradual recession of water, leaving land permanently uncovered.

Question 12

Government Powers

Answer 12

PETE- Police power, Eminent domain, Taxation, Escheat.

Question 13

Police Power

Answer 13

The government’s right to regulate conduct or property to protect the health, safety, welfare, and morals of the community. Includes regulations like zoning laws. Zoning

Question 14

1031 Tax Deferred Exchange

Answer 14

Process which allows investors to sell a property and reinvest the proceeds into a new property (as part of a qualifying like-kind exchange) while postponing the payment of capital gain taxes.

Question 15

Boot

Answer 15

Cash or property used to balance out the equities of properties being exchanged. Receipt of boot may result in a recognized gain. Cost basis of the old property will be the same as Cost Basis of the new property being acquired, regardless of any boot given in the exchange.

Question 16

Ad Valorem

Answer 16

Ad Valorem When something is taxed based on its value. Latin for “According to Value.

Question 17

Tax Shelter

Answer 17

General term for any property (or other investment) which gives the owner income tax advantages (such as deductions for property taxes, mortgage interest, or depreciation).

Question 18

Property Tax

Answer 18

involuntary, specific lien levied against real property.

Question 19

Income Tax

Answer 19

An involuntary, general lien levied against income.

Question 20

Zoning

Answer 20

An ordinance (regulation or law) that defines how property is specify geographics zones can be used

Ideally to promote public health and safety, but sometimes they are several reasons of moral in general welfare.The planning of commission is responsible for the zoning all of properties in the local area.

Question 21

Variance

Answer 21

Request to deviate from zoning laws/For example,When a land owner wants a building 3 feet higher than the zones height restriction allowed.Variance is done lot by lot.

Question 22

Down zoning

Answer 22

Changing a zone from commercial to residential

Question 23

Grandfather Clause

Answer 23

Allows a property to continue it’s existing use, even if it doesn’t comply with zoning laws.

Question 24

Nonconforming Use

Answer 24

Allows a property to continue it’s existing use when it no longer complies to zoning regulations, but did at the time the property’s use was established.

Question 25

Multi-family Residential use.

Answer 25

An r-3 zone is for multi~family residential use.

Question 26

Building Codes

Answer 26

Establish minimum standards of construction for public safety. Local building codes usually set high standards. When they are different from state standards or federal standards, the builder must follow whichever standards are highest- for example, if the local codes requires 1 handrail and federal law requires 2 hand rails, the builder must install 2 handrails.

Question 27

Escheat

Answer 27

When property is returned to the state because there is no individual owner- for example, when a property owner dies intestate (without a will), and without heirs. An individual cannot get property through escheat, it is a government power.

Question 28

Intestate

Answer 28

Without a will.

Question 29

Testate

Answer 29

Having a will.

Question 30

Probate Sale

Answer 30

The selling of a property when a homeowner dies and the property needs to be divided among inheritors or sold to pay debts. The broker’s commission is set by the court in a probate sale.

Question 31

Holographic Will

Answer 31

Handwritten will.

Question 32

Taxation

Answer 32

Financial charge (or some other type of levy imposed) upon a taxpayer by a governmental organization.

Question 33

1031 Tax Deferred Exchange

Answer 33

Process which allows investors to sell a property and reinvest the proceeds into a new property (as part of a qualifying like-kind exchange) while postponing the payment of capital gain taxes.

Question 34

Boot

Answer 34

Cash or property used to balance out the equities of properties being exchanged. Receipt of boot may result in a recognized gain. Cost basis of the old property will be the same as Cost Basis of the new property being acquired, regardless of any boot given in the exchange.

Question 35

Ad Valorem

Answer 35

When something is taxed based on its value. Latin for “According to Value.”

Question 36

Tax Shelter

Answer 36

General term for any property (or other investment) which gives the owner income tax advantages (such as deductions for property taxes, mortgage interest, or depreciation).

Question 37

Property Tax An involuntary,

Answer 37

An involuntary, specific lien levied against real property.

Question 38

Income Tax

Answer 38

An involuntary, general lien levied against income.

Question 39

Marginal Tax Rate

Answer 39

Percentage of tax applied to your income for each tax bracket in which you qualify. In essence, the percentage taken from your next dollar of taxable income above a predefined income threshold. It is applied to the nearest dollar of taxable earned income.

Question 40

Unadjusted Cost Basis

Answer 40

Original price of a property. Used to calculate capital gains. It is usually just the purchase price.

Question 41

Adjusted Cost Basis

Answer 41

Takes into account changes to a property which would affect its cost. To calculate, start with the amount originally paid, add the cost of improvements and assessments, then subtract deductions taken (such as depreciation and depletion)- for example, adding the cost of a new concrete patio on your personal residence. Mortgage payments are not included in this calculation.

Question 42

Eminent Domain

Answer 42

Property taken by the government for public use in exchange for just compensation. Government power.

Question 43

Condemnation

Answer 43

Action which results in compensation for a property when eminent domain rights are exercised by the government.

Question 44

Inverse Condemnation

Answer 44

Action which results in compensation for a property when eminent domain rights are exercised by the government.

Question 45

Lis Pendens

Answer 45

A pending legal action- for example, a notice that a property is due to be taken to court which, depending on the results of the court case, could affect the title. A lis pendens remains in effect until there is a judgment or the court case is dismissed.

Question 46

Injunction

Answer 46

A court order to stop certain actions by certain individuals- for example, local homeowners could seek an injunction to stop another homeowner from putting up a large neon sign over his home that says “Motel”.

Question 47

Writ of Execution

Answer 47

example, to sell a property to satisfy a judgment against the owner.

Question 48

Constructive Notice

Answer 48

A “legal fiction” that says someone has been notified of something even though actual notice didn’t happen. With property, once a document is recorded, subsequent buyers are deemed to have received “constructive notice” regarding the document and its effect on the property. Constructive Notice can also be given by taking possession.Why can’t you please papa

Question 49

Constructive Notice

Answer 49

A “legal fiction” that says someone has been notified of something even though actual notice didn’t happen. With property, once a document is recorded, subsequent buyers are deemed to have received “constructive notice” regarding the document and its effect on the property. Constructive Notice can also be given by taking possession.

Question 50

Actual Notice

Answer 50

When first-hand knowledge of something’s provided to an individual-for example, if a buyer knows that someone has taken possession of the property that is for sale.

Question 51

Material Fact

Answer 51

Fact that a reasonable person would think was relevant to a decision being made- for example, un-repaired water damage in the attic of a home for sale. If knowing something could cause a person to change their mind about a transaction, legally it’s a material fact.

Question 52

Acknowledgement

Answer 52

An affirmation or declaration used to authenticate legal instruments, usually done by a notary (a public figure who can oversee the signing of documents, such as deeds or mortgages). An Acknowledgment may only be carried out by a notary public who has no interest in the transaction.