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Colorado Real Estate License Exam > National PSI Real Estate Exam Prep > Flashcards

National PSI Real Estate Exam Prep Flashcards

1
Q

Cooperative (“Co-Op”) Ownership

  1. Similar to…
  2. But Is not …
  3. Instead owns …
A
  1. Condominium or Townhouse
  2. Real Estate
  3. Stockholder in a corporation that Entitles the holder to a leasehold interest in a specific unit of real property.
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2
Q

Townhouse vs. Condominium

  1. Condominium excludes…
  2. Townhouse includes…
A
  1. Actual ownership of land below the unit, air space above, and sometimes a yard.
  2. condominium owns only the unit and a share of the common interest property, like a park or pool
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3
Q

How many square feet in an acre?

A

43,560 square feet

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4
Q

Define “real property” or “real estate”.

A

Land + Improvements

Improvements are the things attached to the land and the rights/benefits that run with its ownership.

Examples:
House
Fence
Trees (but not crops)
Built in bookcases
Light fixtures
Window coverings(?)
Sinks, baths 
Swimming pool
Easement to access the nearest road
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5
Q

“Land”

A

By default includes earth’s surface, subsurface all the way down to the center of the eart & sky up to the outer atmosphere.

In Colorado, mineral & water rights have often been “stripped”. Upper atmosphere has been claimed by nations under eminent domain, for satellites etc.

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6
Q

“Improvements”

A

Things attached to the land and the rights/benefits that run with its ownership.

Aka “appurtenances”

Examples:
House
Fence
Trees (but not crops) 
Built in bookcases
Light fixtures
Window coverings(?)
Sinks, baths 
Swimming pool
Easement to access the nearest
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7
Q

“Personal property”

A

Property that is unattached & moveable.

Example:
Rugs
Jewelry
Lawn mower

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8
Q

Legal Test: Is it a Fixture?

4 Part

A
  1. Intent to make permanent
  2. Method of attachment
  3. Adaptation / Customization
  4. General understanding
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9
Q

3 Key Characteristics of Land

A
  1. Immovable. Can’t relocate.
  2. Permanent. Can’t be destroyed.
  3. Unique. Cannot be duplicated.
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10
Q

Factors Influencing Value of Land

A
  1. scarcity
  2. improvements
  3. type of ownership
  4. area preference (i.e. “location)
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11
Q

“Encumbrances”

A

Encumbrances are non-ownership interests that represent a restriction on the use and/or transfer of real property.

Examples:
Mortgage
Other Liens
Easements

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12
Q

Types of Liens

A
  1. Voluntary vs. Involuntary

2. General vs. Specific

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13
Q

Effective date of a lien

A

Generally the day it is recorded.

Except mechanics liens may relate back to the date work was completed.

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14
Q

“Easement”

A

The right of a non-owner to use a property for a specific purpose, (generally to cross over it).

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15
Q

Appurtenant Easement

A
  1. Runs with the land.

2. Involves a dominant estate which is sllowed to use the servient estate for a specific purpose (typically for access).

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16
Q

“Easement in Gross”

A

The easement is not to a neighbor, but rather to a utility or permission granted to hunt on the land.

Does not run with the land. Terminates upon sale, contractual expiration or death of the owner.

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17
Q

“Prescriptive easements”

A

Acquired right to use land of another:

  1. open
  2. notorious
  3. hostile
  4. statutory period (“tacking” may be permitted)
  • Prevented by closing off access periodically. Signage.
18
Q

“License”

A

A personal, revocable right or privilege granted by an owner to someone else to use the property, typically in a brief, limited way.

19
Q

“Encroachment”

A

Tree branch growns over the property line.

Shed built on your neighbor’s property.

Septic tank spilled into neighboring well!

20
Q

“Clear Title”

A

Also known as “good title”, it is free of restrictions that would limit transfer.

21
Q

“Equitable Title”

A

The right to acquire ownership and formal legal title, e.g. when a prospective buyer has entered into a valid, enforceable contract.

22
Q

“Bare legal title”

A

A limited form of technical ownership. For example, this is the type of title held by a mortgage lender or a seller who has entered into a legally binding contract to sell.

23
Q

4 Governmental Powers Over Property

A
  1. police power,
  2. taxation,
  3. eminent domain
  4. escheat.
24
Q

Examples of Police Power

A

Zoning

Building Permits

25
Q

Ad Valorem Taxes

A

Meaning “at value”.
General Assessments based on the assessed value of the property. This is the primary tax base used by municipalities to provide fire stations, police, parks & road maintenance.

26
Q

Special Assessment

A

An additional tax, assessed for a specific purpose, such as replacing a bridge or building a new high school.

27
Q

Tax liens

A

If property taxes are unpaid, the taxing authority may place a lien against the title.

28
Q

Eminent Domain

A

Forced sale if property for a use, public or private, deemed by Gov’t to be beneficial to the community’s interest. VERY UNPOPULAR.

  • miltary base expansion
  • utilities installations
  • industrial park
29
Q

Emminent Domain: 3 Stages

A
  1. Negotiation
  2. Condemnation /Litigation
  3. If win either way, FMV Compensation
30
Q

Eminent Domain is authorized by?

A

US Constitution, 5th Amendment, “takings clase”.

31
Q

Water rights: prior-appropriation doctrine

A

those along a waterway may take all they want for “reasonable & beneficial use” regardless of those downstream.

“first in time, first in right”

WESTERN STATES

32
Q

Water right: permits

A

Government restriction of water use or access such as dighing a well, irrigating agriculture, or even collecting rainwater (Western/ Arid states)

33
Q

What is the riparian-rights doctrine?

A

Differs from prior appropriation doctrine.

All owners benefiting from bordering a river or stream have EQUAL rights to use the water passing by or through the property.

Being upstream doesn’t give an advantage.

EASTERN STATES

34
Q

Abatement, mitigation, and cleanup may be required as an exercise of police power to address …

A

environmental hazards.

35
Q

What is CERCLA?

A

Comprehensive Environmental Response, Compensation, and Liability Act 1980

aka Superfund Legislation

36
Q

What did CERCLA do?

A

established requirements and liabilities concerning closed and abandoned hazardous waste sites, and established a trust fund to pay for uncollectable cleanup costs

37
Q

What did the Superfund Amendments and Reauthorizations Act (1986),

A

Kept Superfund trust funded.
Stressed the importance of permanent remedies and cleanup technologies.
Added enforcement powers.

38
Q

What is Resource Conservation and Recovery Act (RCRA)?

A

An amendment to the Solid Waste Disposal Act. Governs private & public solid waste disposal.

39
Q

What larger act encompasses the Oil Pollution Act (OPA)?

A

The Clean Water Act.

Does what it sounds like: regulates responses and responsibilities for oil contamination

40
Q

What law requires an Environmental Impact Statement for certain federally funded projects?

A

The National Environmental Policy Act (1969)

41
Q

Name 10 environmental hazards governed by discovery and disclosure duties:

A
  1. lead-based paint
  2. asbestos (abatement)
  3. radon gas (venting)
  4. toxic mold
  5. drinking water contamination
  6. urea formaldehyde foam insulation (UFFI)
  7. contaminated soil
  8. underground storage tanks (oil) (northeast)
  9. protected / endangered species habitat
  10. methamphetamine labs or other chemical contaminants in the building left behind by former use (printing or industrial)
42
Q

In a 1031 exchange, how is the basis of the new property calculated?

A

In a 1031 exchange, the basis of the original property carries over to the new property.

Colorado Real Estate License Exam (3 decks)

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