Brainscape's Knowledge GenomeTM

Browse over 1 million classes created by top students, professors, publishers, and experts.


See full index

Real Estate Contracts > Math > Flashcards

Math Flashcards

1
Q

Debit

A

Debit is an amount of money that a person will owe.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
2
Q

Credit

A

A credit is an amount of money that a person will receive, or that has already been paid, like earnest money.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
3
Q

Prorations

A

Prorations are settled between the buyer and seller in proration to the amount of time they all the property in the billing cycle. They will be a debit for one party and a credit for another for the same amount.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
4
Q

What is a bankers calendar?

A

360 days a year / 30 days a month unless told otherwise.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
5
Q

What is an actual calendar?

A

365 days / actual days in the month

〰30 days in September, April, June & November … all the rest have 31 except February, which has 28

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
6
Q

Commission splits

A

Use the T formula

       Commission $ --------------------------------------------------- Sales Price x Commission Rate
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
7
Q

Sellers Net:

How to figure it out

A
  • Add expenses and subtract refunds from desired net amount
  • Subtract the rate from 100% first, then use the t-method
  • also called “sellers dollars after commission”
                PART (net before commission) ----------------------------------------------- SALE PRICE x. 100% - commission =
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
8
Q

Prorations:

Do you debit and credit the same amount for prorations?

A

Yes - i’ll prorations will be debited and credited the same amount.

Use a bankers calendar, which is 30 days a month, 360 days in a year unless it specifically states actual days.

Actual days referred to the actual number of days in a month and 365 days in a year.

Seller owns the home the day of closing.

  • Be careful deciding which calendar to use…(bankers or actual)
  • Who owes whom
  • What are the timeframes
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
9
Q

TAX MATH
Mills = 1/1000 of a dollar
Mileage rate = mills x .01 move decimal three spaces to the left i.e.; 7 mills =.007
Use millage rate in place of tax rate\unit

A

Formulas:

Value x Assessment Rate x Equalization Factor (if any) x (tax rate/unit ➗100) = Taxes

Value x Assessment Rate x Equalization Factor (if any) x Millage Rate = Taxes

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
10
Q

Financing Math

Loan amount X interest rate = interest

Interest paid ➗ loan amount = interest rate

Interest paid ➗ interest rate = Loan amount

A 
PART
                     (Annual Interest)
      -------------------------------
        WHOLE.        x.    Interest Rate
      (Loan Amt).                 (%)
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
11
Q

Interest Due on Loan

A

INTEREST $ (Part)
_______________________
Loan Amt x Interest Rate

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
12
Q

Loan Fees

(the lesser of sale price or appraised value) x LTX = loan amount

Loan amount x number of points = dollar amount

Loan balance x penalty rate = prepayment penalty

A

LTV = Loan-to-Value: the loan amount as a percentage of the value of the property (sale price or appraised value, whichever is less).

Points (pts): - up front interest. Also know as a discount points

1 point (pt) = 1% of the loan amount

Origination Fees - include processing fees, points, underwriting fees, closing costs, etc.

Prepayment penalty: - a percentage of the loan amount that is charged should the loan be paid in full prior to the maturity date.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
13
Q

Valuation Math
The Income Approach is used for valuation of income-producing such as apartments, office buildings and shopping centers. It assumes that the income generated by a property determines the property’s value.

A

Capitalization Rate (Cap Rate) - the potential rate of return on an owners investment

Net Operating Income (NOI) = annual income - annual expense

NOI = annual income - annual expenses
NOI / market value = Cap Rate
NOI / Cap Rate = Value
Value x Cap Rate = NOI

   Net Operating Income \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ Market Value   x   Cap Rate (%)
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
14
Q

Linear Measurements: a linear measurement is a line measurement, used perhaps to measure the lenght of a fence or to measure frontage on the lake or road.

A

12 inches = 1 foot
3 feet = 1 yard
5280 feet = 1 mile
A perimeter is the distance around something. It is the total of the lengths of all sides.
Frontage (front door) - typically the first number given in a lot measurment. Ex. 75 ft. x 50 ft.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
15
Q

Area Measurements: Real Estate is often measured in square feet or acreage.

A

1 acre = 43,560 sq. ft
1 mile = 5,280 feet
1 section = 1 square mile = 640 acres
1 sq. yard = 9 sq. ft

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
16
Q

Formulas for Area Measurements

A

Area of Rectangle = length x width
Area of Triangle = 1/2 base x height
or length x width x .5 = Triangle

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
17
Q

How many inches are in a foot?

A

12 inches = 1 foot

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
18
Q

How many feet are in 1 yard?

A

3 feet = 1 yard

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
19
Q

How may feet are in a mile?

A

5,280 feet = 1 mile

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
20
Q

How many sq feet are in 1 acre?

A

43,560 sq. feet = 1 acre

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
21
Q

1 mile is how many feet?

A

1 mile = 5,280 feet

22
Q

1 section equals how many square miles?

A

1 section = 1 sq. mile = 640 acres

23
Q

How many square miles = 640 acres?

A

1 square mile = 640 acres

24
Q

1 section = 1 square mile = 640 acres

A

know this

25
Q

1 sq. yard equals how many feet

A

1 sq. yard = 9 sq. feet

26
Q

Volume Measurements: volume is the space inside a 3-dimensional object. Volume is measured cubic units.
***this is most used when calculating warehouse space..

A

Convert the length, width & height measurements into similar units such as feet, inches or yards.
1 cubic yard = 3’x3’x3’ = 27 cubic feet

Formula:
volume of rectangular space = length x width x height

27
Q

How is concrete different when measuring?

A
  • ***Concrete is usually measured in cubic yards.

* ***There are 27 cubic feet in ONE cubic yard.

28
Q

What is the formula for measuring Cubic Yards?

A

cubic feet / 27 = cubic yard

29
Q

Rectangular Survey Method: always begin this question at the end! Forget about the company directions. Only use the numbers; the compass directions do not have any bearing on the outcome of the problem. YOU WILL ONLY USE THE DENOMINATOR OF EACH.

A

A section is a portion of a township under the rectangular survey system. A section is a square with mile-long sides and an area of one square mile or 640 acres.
**1 section = 640 acres = 1 sq. mile

30
Q

The sale price is a _______to the buyer and a ______to the seller?

A

The sale price is a DEBIT to the buyer and a credit to the seller.

31
Q

Earnest money is ______to the buyer?

A

Earnest money is a CREDIT to the buyer.

32
Q

The sellers old loan to be paid off is a _______to the seller?

A

The sellers old loan to be paid off is a DEBIT to the seller, unless the loan is being assumed. If the loan is being assumed then it would be a debit to the seller and a credit to the buyer.

33
Q

The buyers new loan is a _______to the buyer?

A

The buyers new loan is a CREDIT to the buyer.

34
Q

If the lender charges a prepayment penalty, it is a ________ to the seller?

A

If the lender charges a prepayment penalty, it is a DEBIT to the seller.

35
Q

The interest due on the buyers new loan is a ________ to the buyer?

A

DEBIT

36
Q

If there is a loan origination fee, it is a ___________to the buyer?

A

DEBIT

37
Q

Taxes, if they have NOT been paid. (they are paid in arrears) will be a ______ to the seller and a _______to the buyer?

A

DEBIT to the seller and a CREDIT to the buyer

38
Q

If the taxes have been paid in advance, ________the seller and __________the buyer?

A

CREDIT the seller and DEBIT the buyer

39
Q

If there is an insurance assumption by the buyer then the entry will be a ________to the seller and a _________to the buyer?

A

CREDIT to the seller and DEBIT to the buyer

40
Q

If the seller prepaid a bill, the entry will be a ________to the seller and ________to the buyer?

A

CREDIT to the seller and DEBIT to the buyer.

41
Q

If the seller has collected rent from tenants, the entry will be a _________to the seller and ________to the buyer?

A

DEBIT to the seller and CREDIT to the buyer

42
Q

If the buyer buys personal property from the seller it is always entered as a _______to the buyer and _________to the seller.

A

DEBIT to the buyer and a CREDIT to the seller

43
Q

If a seller loans the buyer money for a down payment, the entry would be a __________to the seller and ________to the buyer?
pg. 72

A

DEBIT to the seller and a CREDIT to the buyer

44
Q

Discount Points

A

Discount Points
____________________________
Loan Amt x 1% / pt.

45
Q

Sellers Net

A

Sellers Net
_____________________________
Sale Price x 100%
- Commission %
________________
%

46
Q

Commission

A

Commission
_______________________________
Sales Price x Comm Rate %

47
Q

Loan Origination Fee

A

Loan Origination Fee
_______________________________
Loan Amt. x % (mills X .001)

48
Q

Taxes

A

Taxes
_______________________________
Value x Tax %

49
Q

Assessed Value

A

Assessed Value
________________________________
Value x Assessed %

50
Q

Interest $

A

Interest $
________________________________
Loan Amt x Interest %

51
Q

Net Operating Income

A

Net Operating Income
_________________________________
Value x Cap %

52
Q

Part Annual Interest

A

Part (Annual Interest)
_________________________________
Whole (Loan Amt) x Interest Rate (%)

Real Estate Contracts (9 decks)

Brainscape helps you reach your goals faster, through stronger study habits.
© 2024 Bold Learning Solutions. Terms and Conditions