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CE SHOP - MAIN POINTS > MAIN POINTS ON EDGE TESTS > Flashcards

MAIN POINTS ON EDGE TESTS Flashcards

1
Q

What is Fee simple estate?

A

Also known as fee simple absolute is a type of freehold estate that conveys the most rights available.

Property held as a fee simple can be sold and is inheritable.

Timeshare estates are owned as fee simple estates

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2
Q

What is Fee simple defeasible?

A

freehold estate in which ownership is subject to either the occurrence or non-occurrence of a particular event. The two categories of fee simple defeasible estates are fee simple determinable and fee simple subject to condition subsequent.

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3
Q

within fee simple defeasible, what is the difference between simple determinable and fee simple subject to condition?

A

With a fee simple determinable estate, the current property owner conveys ownership to a new owner as long as some event does or doesn’t occur.

With a fee simple subject to condition subsequent estate, the current property owner conveys ownership to a new owner on a specific condition.

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4
Q

Explain the 4 leasehold estates:

A

An estate for years is a lease that ends on a specific date

A periodic estate (aka estate from period to period) is a lease that automatically renews at the end of its term (such as a month-to-month lease)

An estate at will is a lease without an established ending

An estate at sufferance is one in which a tenant (referred to as a holdover tenant) didn’t leave when the lease expired.

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5
Q

it is a form of co-ownership in which each co-owner is entitled to possession of the whole. An owner’s ownership is inheritable and, upon the owner’s death, doesn’t necessarily pass to the other owners.

A

Tenancy in common

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6
Q

it is a form of co-ownership in which equal ownership requires unity of time, title, interest, and possession.

it includes the right of survivorship, which means that the surviving co-owner(s) will own the property of a tenant who dies.

A

joint tenancy

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7
Q

it is an interest in real property where the owner’s possession of the property isn’t of fixed duration,

A

a freehold estate

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8
Q

it is is a type of freehold estate in which ownership is limited to someone’s lifetime.

A

A life estate

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9
Q

it is based on the life of the estate holder/life tenant. For example, Christine gives her son this estate in a property, and the estate lasts until her son’s death.

A

An ordinary life estate

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10
Q

it is based on the life of someone other than the holder of the life estate/life tenant. For example, Jarrod grants his ex-wife, Margo, a this life estate in a house where Jarrod’s mother Rose and Margo, who cares for Rose, both reside. The life estate stipulates that Margo’s interest in the property will cease when Jarrod’s mother dies.

A

Pur Autre Vie (“for another’s life.”)

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11
Q

The bundle of rights includes:

A

Possession: the titleholder may possess (be on) the property.

Control: The owner controls the use of the property.

Exclusion: The owner may decide who may or may not access the property.

Enjoyment: The owner may use the property in any legal matter.

Disposition: The owner has the right to sell or convey the property.

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12
Q

Which document is used to give a buyer an overview of the title history and information about what is or isn’t covered in an insurance policy?

A

Preliminary report

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13
Q

a summary giving details of the title deeds and documents that prove an owner’s right to dispose of land, together with any encumbrances that relate to the property.

A

Abstract of title

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14
Q

Which clause in the listing agreement gives the listing broker the authority and obligates the broker to market the property to other brokers?

A

Multiple listing clause

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15
Q

An abandoned or otherwise unused commercial or industrial site with suspected contaminants is known as what?

A

A brownfield

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16
Q

If the building has no elevator and four units and was ready for occupancy after March 13, 1991

A

disability requirements apply to ground floor units.

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17
Q

What are the three major leases?

A

A net lease is one in which the tenant pays some or all of the property’s costs in addition to rent. When the tenant is paying for property taxes, insurance, and maintenance along with the rent, the lease is generally referred to as a triple net lease (NNN). An absolute net lease is a triple net lease in which the tenant is also responsible for all building expenses and repairs, including roofing and structural repairs.

A gross lease is one in which the landlord pays all expenses related to the property, such as taxes, repairs, insurance, utilities, maintenance) while the tenant pays a fixed rent. These are sometimes called full-service leases.

A graduated lease allows specific rent increases at future dates. It’s a type of variable lease that permits an increase/decrease in rent during the lease period. The increase can be based on a number of factors, such as changes to appraised value, index, or time.

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18
Q

As far as judiciary duties go, which one is the most fundamental and which one last forever?

A

Loyalty is the most fundamental

confidentiality lasts forever

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19
Q

How’s the Georgia intangible tax computed?

A

It’s based on the amount borrowed, and is $1.50 per each $500 or fractional part thereof, with a maximum of $25,000.

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20
Q

it is when a licensee provides a contract to a lender where the sales price listing is above the actual sales price. This is fraud and it’s illegal.

A

Kiting

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21
Q

it is an exaggerated image of what is being described and is especially featured in testimonials.

A

Puffery

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22
Q

Mention the 8 economic principles of value?

A

conformity: how similar it is to other properties
competition: what else is available.
substitution: A reasonable person will not pay more for a property if a comparable one can be had for less.
contribution: The value of any given change to the property is dependent on the value of the property as a whole. Because of this, the same improvement to different houses may result in an increase in value in one, while the other sees no appreciable change.

The principle of plottage: combining adjacent parcels of land into a single parcel
The principle of assemblage: combing the parcels

The principle of regression: A decline in value due to the decline in value of neighboring properties

The principle of progression: The increase in property value from increased surrounding property values

The principle of anticipation: Changes in value may be caused by the expectation of events.

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23
Q

Federal law exempts this property from the certified appraisal requirement because the sales price is less than

A

$400,000

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24
Q

Georgia brokers must maintain copies of written agreements with non-resident licensees for a minimum of

A

Three

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25
Q

What must Georgia associate brokers do in order to work independently as brokers?

A

Have written consent from all brokers involved.

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26
Q

it is a horizontal point of reference from which surveyors measure the depth and height of various land elevations.

A

A datum

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27
Q

it is a point where the exact elevation is known and marked with a brass or aluminum plate. Surveyors can use this as a starting point to measure other elevations.

A

A benchmark

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28
Q

they are the direction and distance of a line forming the property’s boundary;

A

metes

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29
Q

Beginning at a stake and stones about 30 feet from the center of the brook that runs across the road southwesterly from the dwelling house of the late Jebediah Smith now occupied by the widow Callie Thornton and in the west line of the highway leading by the dwelling house now occupied by the widow Callie Thornton …

A

metes and bounds

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30
Q

they are physical features that define the boundaries of the property

A

bounds

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31
Q

A permanent physical marker used in a metes-and-bounds description that can be man-made or natural. It may be a tree, creek, rock, or a stake placed in the ground.

A

Monument

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32
Q

it divides land into townships and further into sections and fractions called sections.

A

The rectangular government survey system

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33
Q

begin with a reference to either metes and bounds or RGSS, then divide the land into lots with numerical descriptions of each parcel

A

Lot-and-block systems

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34
Q

Number township

A

6 5 4 3 2 1
7 8 9 10 11 12
18 17 16 15 14 13
19 20 21 22 23 24

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35
Q

“The north half of the northwest quarter of Section 6, Township 8 North, Range 68 west of the 5th principal meridian.”

A

Rectangular government survey

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36
Q

when The Closing Disclosure and Loan Estimate aren’t required?

A

When it is seller-financed

When it is for HELOC or equity loan

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37
Q

how many square feet in an acre?

A

43,560

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38
Q

what are 4 terms describing natural processes associated with water rights?

A

Accretion: Process by which water carries rock, sand, and soil and causes land build-up

Alluvion: New deposits of land that are the result of accretion

Erosion: Gradual loss of land due to a natural force

Avulsion: A sudden loss of land by a swift, large-scale change in water flow

Reliction: When water gradually recedes and uncovers new land

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39
Q

Economic characteristics of land

A

Scarcity: You can’t make more land

Improvements: A land’s value can be positively or negatively affected by the improvements made on it.

Permanence of investment: Some improvements are long-term, stable investments with stable returns over time.

area preference: A property’s value dependson its location.

40
Q

DESCRIBE TYPE OF LIENS

A

liens, and decedent’s debts.

A mechanic’s lien is one a vendor of goods or services places on the property and creates a cloud on the property’s title.

ATTACHMENT LIEN IS the one a court places on a property, also known as judgment liens

41
Q

What is a quitclaim deed?

A

It just transfer the title from the grantor to grantee but offer no guarantees or warranties.

42
Q

DESCRIBE THE 7 STEPS OF APPRAISAL

A
  1. STATE THE PROBLEM
  2. Identify data needed.
  3. GATHER AND ANALYZE DATA
  4. Determine highest and best use (Imagine no comparables)
  5. Estimate the land value (as if the land were vacant).
  6. Use one or more of the three approaches to valuation
  7. Reconcile values to determine the final appraised value.
43
Q

Security instrument clauses include:

A

The defeasance clause orders the lender or trustee to immediately release full title to the borrower once the loan is paid in full.

An acceleration clause makes the entire debt due immediately if there’s borrower default.

A due-on-sale clause (also known as alienation clause) requires the borrower to repay the loan when transferring ownership to another.

44
Q

In Georgia, upon what amount is the transfer tax calculated? and upon what amount is the intangible tax calculated?

A

Transfer Tax: Sale price

Intangible Tax: borrow price

45
Q

who pays the transfer tax and who pays the intangible tax?

A

Transfer tax: SELLER

Intangible tax: BUYER

46
Q

How much is a section?

A

one mile square, or 640 acres each.

47
Q

unlike, buyer or seller agency, Agency coupled with interest is

A

irrevocable.

48
Q

How many acres in a square mile?

A

640 acres

49
Q

Three covenants provide present warranties:

A

Covenant of SEISIN: The grantor holds title to and possession of the property.

Covenant of right to convey: The grantor has the right to convey both title to and possession of the property. it has to be of legal age

Covenant against encumbrances: The grantor assures the grantee that there are no encumbrances against the title other than those identified in public records or the deed itself.

50
Q

Which clause in the deed of trust and Georgia’s security deed is the equivalent of the defeasance clause in the mortgage?

A

Reconveyance

51
Q

All lenders have different underwriting standards, but traditionally

A

the housing debt-to-income ratio: 25 to 28%

total debt-to-income ratio of : 33 to 36%

52
Q

it determines a probable range of property values by comparing a group of comparable sales to the subject. The appraiser attempts to include both superior and inferior units of comparison such as age and transaction price.

A

Bracketing

53
Q

What’s the capitalization formula used in the income approach?

A

Value = net operating income divided by cap rate

54
Q

it gives the lender power of sale, meaning the lender can sell the property without judicial proceedings if the borrower defaults.

A

Transfer of Rights in Property

55
Q

How many feet are in a mile?

A

5,280

56
Q

Physical characteristics of land

A

Immobility: The geographic location of land is fixed and can’t be changed.

Indestructibility: Improvements may deteriorate over time, but not land itself.

Uniqueness/nonhomogeneity: One piece of land is never exactly like another.

57
Q

Economic characteristics of land

A

Scarcity: You can’t make more land; what we have now is what we’ll always have.

Improvements: A land’s value can be positively or negatively affected by the improvements made on it.

Permanence of investment: Some improvements are long-term, stable investments with stable returns over time.

Situs/location/area preference: A property’s value depends in large part on its location.

58
Q

What is a statutory right of redemption?

A

The right of a borrower to redeem the property by paying amounts owed plus costs, even after the foreclosure sale

59
Q

What is the overarching theme addressed by statutory duties in most states?

A

Licensees may not take any action that might be detrimental to the client’s legal interests.

60
Q

Zoning actions may include:

A

Nonconforming use: Deviates from current zoning but is grandfathered in (such as a home built years ago in an area that’s now commercially zoned).

Moratorium: Temporarily halts new property development

Special use permit (aka conditional use permit): Allows use that’s not normally permitted but is considered an “allowable” use within that zoning, such as a church within a residentially zoned area

Variance (aka use variance) Permitted deviation in the zoning ordinance requirements; typically granted when the zoning has created a hardship or burden on the property owner.

Both special use permits and variances require a public hearing before they’re

61
Q

Which of the following loans may require compliance with Appraiser Independence Requirements?

A

Conventional

62
Q

Barb is a qualifying broker in Georgia. She must ensure that all contracts prepared by her licensees are reviewed ______.

A

Within 30 days

63
Q

what is the difference between pre-approval and pre-qualification?

A

A pre-approval letter comes with lender verification of buyer-provided data and provides more assurance to the seller.

Prequalify means that the bank just gather data

64
Q

What is an encumbrance?

A

A defect on a title that can be monetary or physical

65
Q

An illegal practice in which licensees or others encourage homeowners to sell because of an influx or expected influx of minorities into the area

A

blockbusting

66
Q

The practice of a lender to refuse to lend in a specific area, often based on the minority makeup of the area.

A

redlining

67
Q

The illegal practice of nudging buyers away or toward a specific area based on the presence or absence of protected class members in the area relative to the buyers.

A

steering

68
Q

what does the W4 and w9 form do?

A 
w4 = employee form
W9 = request information from company
69
Q

What’s the purpose of a chain of title?

A

To establish history of past ownership

70
Q

GREC members serve five-year terms. If a member ends her term early, what will happen?

A

The governor will appoint another member to fill the vacancy.

71
Q

Common reports in leasing include:

A

Operating budget: Usually covering a one-year period, this report projects the income and expenses of operating the property.

Cash flow report: Usually created monthly, this report shows the current financial status of a property. It accounts for income received (such as rent, late fees, etc.) and expenses paid (such as utilities, personnel, repairs, etc.).

Profit and loss statement: Prepared on a monthly, quarterly, semi-annual, or annual basis, this report shows whether the property profited during the period or suffered a loss.

Budget comparison statement: This report compares actual results from the profit and loss statement to those projected on the operating budget.

72
Q

What’s true about the right of redemption in Georgia?

A

Georgia law doesn’t provide a right of redemption after foreclosure except in cases of tax sales.

73
Q

Henry submits an offer on a condo and includes an earnest money check for 10% of his offer, which the seller accepts. Later on at closing, he brings a cashier’s check for $34,450 (comprising the remaining half of his 20% down payment and $7,950 in closing costs). What’s the condo’s purchase price in whole dollars?

A

Subtract the closing costs from cashier’s check amount ($34,450 – $7,950=$26,500) for half of down payment. The total DP was double this ($53,000). Next, divide $53,000 by 20% (to find purchase price ($53,000 ÷ .2=$265,000). Purchase price is $265,000.

74
Q

Which act was the first to prohibit any exceptions for discrimination based on race or color?

A

Civil Rights Act of 1866

75
Q

What is the assesement % multiply by? The appraisal, borrowed, or sale price?

A
  1. SALE PRICE
  2. APPRAISAL PRICE (IF PROVIDED)
  3. NOT ON THE BORROWED AMOUNT
76
Q

Gabi owns one parcel measuring one square mile and another parcel measuring one mile x half a mile. She combined the parcels and sold them for $2.5 million. What price per acre did she receive for the land?

A

Since we know that one square mile is 640 acres, we can convert each parcel to acres. The first parcel is 640 acres (one square mile). The second parcel is half that size (1 mile x 1/2 mile), or 320 acres. Thus, the total acreage is 960. Divide the sales price by the total acreage (2,500,000 ÷ 960), or $2,604.17.

77
Q

What is a binder?

A

A written outline of the sales transaction

78
Q

What is the difference between actual notice and constructive notice?

A

Actual Notice: delivered (EXECUTED)

Constructive Notice: signed (EXECUTORY)

79
Q

Within a brokerage, who’s responsible for supervising a team’s unlicensed personal assistant?

A

Qualifying broker

80
Q

Title VIII of which law prohibits discrimination in the sale, rental, and financing of housing?

A

Civil Rights Act of 1968

81
Q

Which of these statements about a deed’s habendum clause is true?

A

It’s a description of the act of conveyance.

82
Q

Mention the Easement types:

A

Easement appurtenant: Attached to a specific parcel of land, transfers (“runs”) with the land, and gives the “dominant tenement” rights to use adjoining property/servient tenement

Easement in gross: Granted to a specific individual or business rather than attached to the property itself. (Utility companies)

Easement by necessity: This easement type can only be created for the purpose of ingress and egress.

Easement by prescription: This easement isn’t legal, and is created through the continued, uninterrupted, obvious, exclusive, and adverse use of someone’s property without permission.

83
Q

What forms the boundaries of a township?

A

Township lines and range lines

84
Q

Your clients are looking at buying a $200,000 property with a 30-year loan at a 5% interest rate. If the amortization factor is 5.36822, how much would their principal and interest payment be per month? Remember: The monthly payment multiplier is per $1,000 of the mortgage.

A

The estimated payment is $1,073.64. Remember to divide $200,000 by 1,000, then multiply the factor (5.36822) by 200.

85
Q

If a private individual owner doesn’t own more than three single-family homes at one time, which exemption from the Fair Housing Act could apply?

A

Single-family housing sold or rented without the use of a broker is exempt, provided the owner doesn’t own more than three single-family homes at one time.

86
Q

Valdosta licensees Ken, Sharon, and Kate dislike a lender in town and agree to direct business away from that lender and discourage their clients from using it. Which Georgia unfair trade practice act does this violate, if any?

A

This is group boycotting, which is a form of trade competition restriction, so it violates the Georgia Uniform Deceptive Trade Practices Act (UDTPA).

87
Q

What must Georgia associate brokers do in order to work independently as brokers?

A

What must Georgia associate brokers do in order to work independently as brokers?

88
Q

Tom and Jim are neighbors. Jim wants to buy Tom’s rental property. In the contract they sign, Jim is identified only as “the neighbor.” Which statute or contract element does this violate?

A

The statute of frauds

89
Q

What occurs after an investigation if the Georgia attorney general finds reason for disciplinary action?

A

What occurs after an investigation if the Georgia attorney general finds reason for disciplinary action?

90
Q

Which clause is standard in a deed of trust or security deed and affects the foreclosure process that can be used if the borrower defaults?

A

The power-of-sale clause is standard in a deed of trust and Georgia’s security deed, and allows the non-judicial foreclosure process to be used in case of default. Georgia is a non-judicial foreclosure state.

91
Q

Buyer duties outlined in the Exclusive Buyer Brokerage Engagement Agreement include ______.

A

Being available during the agent’s regular working hours to visit properties

92
Q

Tiers in the rectangular government survey system are formed by ______.

A

Parallel township lines

93
Q

Your client submits an application to rent a condo unit. He has excellent credit and has had the same job for a long time. He uses a cane to help with his mobility. When his application is rejected, he feels it’s due to his disability. He is protected under what federal law?

A

Fair Housing Amendments Act of 1988

94
Q

A life estate can best be described as

A

Ownership, possession, and control for someone’s lifetime

95
Q

Which of these terms can be defined as what a buyer has paid for a property and what the seller has accepted?

A

Price

96
Q

Gladys and her husband, Ralph, owned their home as joint tenants. After Ralph died, Gladys owned the home in severalty. When she dies, which of these will happen to her home?

A

Estate in severalty has the right of inheritance, so the property will go to Gladys’s heirs as described in her will or according to the laws of descent in her state if she dies intestate.

97
Q

What title guarantees will Jody have if her property is deeded to her after a foreclosure?

A

The covenant of seisin

Foreclosed property may be conveyed with a referee’s deed, which offers only the covenant of seisin.

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