Modern Real Estate Practice: Unit 2 Flashcards
Governmental Rights in Land - PETE
Police power
Eminent domain
Taxation
Escheat
Police power…
public control of land
Right to enact and enforce laws…
governing land use
Eminent domain…
the right to TAKE private land for public use
Condemnation…
process of taking private land for public use (eminent domain)
Taxation…
real property taxes and special assessments
Property taxes have…
priority over all other liens
Ad valorem =
at assessed value (assessed value x tax rate = property taxes)
Count assessor determines…
assessed value, which is used only by the assessor
Special assessments are…
charges against properties that benefit from a public improvement (street lights, sidewalks, etc). Second priority after upaid taxes
Escheat…
Government’s right to take property that has been abandoned if the owner dies with NO WILL (INTESTATE) and without HEIRS
Annual tax = assessed value x tax rate
Assessed value = actual (market value) x assessment rate (%)
Per =
Divide (mil = divide by 1000)
Giver of the deed; receiver of the deed
GrantOR; grantEE
Giver of the lease; receiver of the lease
LessOR; lessEE
Giver of the mortgage; receiver of the mortgage
MortgagOR (borrower); MortgagEE (lender) - has all the Mon-EEY
Two types of estates…
Freehold and Leasehold (nonfreehold)
Freehold estate…
OWNERSHIP for an indefinite duration
Leasehold (nonfreehold) estates…
POSSESSION for a fixed term
Types of freehold estates (3)…
Fee simple absolute, fee simple defeasible/qualified fee, and life estate
Fee simple absolute…
Complete bundle of rights; maximum or largest control of property; lasts forever
Fee simple defeasible or qualified fee…
Created by a deed condition, normally a gift. If deed condition is violated, may revert to grantor
Life estate…
Life tenant (grantee) is owner. When the life tenant dies, it returns to fee simple absolute.
Leasehold estates…
The POSSESSION is for a fixed term tenant (lessee) holds a leasehold estate; the landlord (lessor) holds a leased fee estate.
Estate (tenancy) for years…
Specific termination date - no advance notice required; Death of landlord or tenant does not terminate.
Types of estate (tenancy)
- Estate for years (notice and definite termination date)
- Periodic estate (automatically rolls over)
- Estate at will (there at the landlord’s discretion)
- Estate at sufference (landlord is suffering cause he/she can’t collect rent)
Encumbrances…
claim, right, or interest held by a party who is not the legal owner of the property (easements, liens, deed restrictions, and iencroahcments.
Easement…
The right to USE the lands of another for a specific purpose. (transfers with the land through the deed)
Appurtenant easements has a…
Dominant holder (receiving the easement) and servient holder (giving the easement)
Easement in gross…
Only has servient property (example: utility easement)
Easement by necessity…
granted by the courts a private owner to prevent property being landlocked
Easements may be created by…
express contract, prescription, or necessity (NOT REVOCABLE ONCE GIVEN)
Easements can be terminated three ways…
- Merger
- Release (of rights) - transfers with deed unless released
- Abandonment (must be proven in court)
Deed restrictions are…
privately created controls on land use to protect property values and owners (examples: no RVs in driveway, no fences in front yard, etc.
Deed restrictions must be for…
lawful purposes (cannot restrict property based on race)
Liens are…
a claim on land to secure payment of debt (voluntary vs involuntary; specific vs general)
Release of liens…
- Lien waiver releases unrecorded lien
2. Recording of a satisfaction releases a recorded lien
Lien types…
- Specific (involuntary - attach only to real or personal property - property taxes, mechanic or construction)
- Mortgage (voluntary)
- General (involuntary - attach to all property - unpaid hospital bills, court order, etc)
- IRS or State (involuntary - income taxes)
Homestead exemption…
is created by state statute to protect primary residence against creditors (personal loans and credit cards)
Doer and curtesy…
other legal rights in some states
Encroachments…
unauthorized use of land (ask listing broker for survey)
Licenses…
revocable permission to grant the right to use property
