Law 8 - Practice

Question 1

For investment property, an improvement is

______________, or _________________, or __________________.

Answer 1

adding something not previously there
upgrading something that was existing
adapting the asset to a new use

Question 2

A repair is defined as those that _____________________________________.

Answer 2

do not add significant value or extend its life.

Question 3

Improvements must be __________________ and ________________ over its useful life.

Answer 3

capitalized depreciated

Question 4

A fax deferred exchange is also known as a _______ and is used for ___________ or _____________ property.

Answer 4

1031
business
investment

Question 5

Agents are not authorized to ______________________.

Answer 5

Practice Law

Question 6

One big advantage to real estate investing is _________________.

Answer 6

depreciation

Question 7

Prices in an open market can be established by principal of _________ and ____________.

Answer 7

supply demand

Question 8

Oversupply of houses can result in _____________ prices.

Answer 8

reduced

Question 9

Four factors that can effect the ability to supply houses are:

Answer 9

capital
labor
land
building materials

Question 10

Three factors that can effect demand for housing are ___________, _____________, and ______________.

Answer 10

population
demographics
employment and wage levels

Question 11

A deed can take several forms, depending on the extent of the __________________________.

Answer 11

grantor’s pledges

Question 12

A general warranty deed provide 5 covenants

1. Seisen warrants that ______________________.
2. Encumbrances warrants that the property _____________________.
3. Quiet Enjoyment guarantees title will be __________________________.
4. Further Assurance promises to _______________________.
5. Warranty Forever promises to ___________________________________.

Answer 12

1. he or she owns the property
2. free of liens or encumbrances
3. good against third parties
4. deliver any instrument
5. compensate for loss any time in the future

Question 13

A special warranty deed contains __ warranties.

Answer 13

2

Question 14

A special warranty deed commonly contains the words ___________________, _____________,, ____________, and _______________.

Answer 14

grantor remises
releases
alienates
conveys

Question 15

A bargain and sale deed contains ___________________________________________.

Answer 15

no express warranties against encumbrances.

Question 16

A quitclaim deed provides the _______________ of any deed. It is usually provided to _______________, ________________________.

Answer 16

least protection
cure a defect
called a cloud on the title

Question 17

Even after obtaining a quitclaim deed is best to request a __________________ as soon as possible.

Answer 17

quiet title action

Question 18

Seller financing is also called ________________________________________.

Answer 18

Purchase Money Mortgage.