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Real Estate Salesperson > NJ Real Salesperson Exam Vocabulary & Math Formulas > Flashcards

NJ Real Salesperson Exam Vocabulary & Math Formulas Flashcards

New Jersey State Real Estate Salesperson

1
Q

Fee Simple Absolute:

A

Most complete ownership, inheritable.

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2
Q

Fee Simple Defeasible:

A

Ownership with conditions, can be lost if conditions aren’t met.

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3
Q

Life Estate:

A

Ownership for the duration of a person’s life.

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4
Q

Estate for Years:

A

Specific start and end date, survives death or property sale.

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5
Q

Periodic-Tenancy:

A

Renews automatically (e.g., month-to-month).

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6
Q

Tenancy at Will:

A

No fixed term, can be terminated by either party.

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7
Q

Tenancy at Sufferance:

A

Tenant stays beyond lease term without landlord’s permission.

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8
Q

Joint Tenancy:

A

Right of survivorship (ownership passes to surviving joint tenants). Requires four unities:
Time (acquired at the same time)
Title (acquired by the same deed)
Interest (equal ownership shares)
Possession (equal rights to possess the entire property)

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9
Q

Tenancy in Common:

A

No right of survivorship (ownership passes to heirs).
Can have unequal ownership shares.

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10
Q

Tenancy by the Entirety:

A

Only for married couples, right of survivorship.

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11
Q

Fiduciary Duties:

A

Care: Protect the client’s best interests.
Loyalty: Prioritize the client’s needs above your own.
Obedience: Follow the client’s lawful instructions.
Disclosure: Disclose all material facts about the property.
Accounting: Handle client funds with honesty and transparency.

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12
Q

Seller’s Agent:

A

Represents the seller.

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13
Q

Buyer’s Agent

A

Represents the buyer.

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14
Q

Dual Agency

A

: Represents both the buyer and seller (requires informed consent from both parties).

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15
Q

Sub-Agency:

A

Occurs when a cooperating broker represents the seller through the listing broker.

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16
Q

Listing Agreements

A

Contracts between the seller and the broker.

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17
Q

Exclusive Right-to-Sell:

A

Broker gets paid regardless of who finds the buyer.

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18
Q

Exclusive Agency:

A

Broker gets paid if they find the buyer, but not if the seller finds their own.

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19
Q

Open Listing:

A

Sellers can list with multiple brokers; only the broker who finds the buyer gets paid.

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20
Q

Buyer Representation Agreements

A

Contracts between the buyer and the broker.

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21
Q

Purchase Agreements:

A

Contracts between the buyer and the seller.

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22
Q

Mortgage:

A

Loan secured by real property.

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23
Q

Down Payment:

A

Portion of the purchase price paid upfront.

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24
Q

Points:

A

Fees paid to the lender to lower the interest rate (each point is 1% of the loan amount).

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25
Q

Closing Costs:

A

Expenses incurred in transferring property ownership (e.g., appraisal fees, title insurance, attorney fees)

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26
Q

Sales Comparison Approach:

A

Compare the subject property to similar recently sold properties.

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27
Q

Cost Approach:

A

Estimating the cost to rebuild the property minus depreciation

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28
Q

Income Approach

A

Estimating the potential rental income of the property.

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29
Q

Fair Housing Act of 1968:

A

Prohibits discrimination based on race, color, religion, national origin, sex, disability, and familial status.

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30
Q

Easement:

A

The right to use another person’s land for a specific purpose (e.g., right-of-way).

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31
Q

Lien:

A

A legal claim against property to secure a debt (e.g., mortgage, property tax lien).

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32
Q

Encroachment:

A

Unauthorized intrusion of a structure or improvement onto another person’s property

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33
Q

Adverse Possession:

A

Acquiring title to property by open, notorious, hostile, and continuous use for a statutory period.

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34
Q

Real Estate Commission

A

The governing body for real estate licensees in New Jersey.

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35
Q

License Requirements:

A

Pass the state and national exams.
Complete required education courses.
Meet character and fitness requirements.

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36
Q

Eligibility Requirements:

A

Be at least 18 years old.
High school diploma or GED equivalent.
Complete a 75-hour pre-licensing course.
Pass the NJ Real Estate Salesperson Exam.
Submit fingerprints for a criminal background check.
Obtain sponsorship from a licensed NJ broker.

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37
Q

License Renewal:

A

Renew every two years.
Complete 12 hours of Continuing Education (CE) courses (2 hours ethics, 6 hours core topics).

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38
Q

Environmental Issues

A

Asbestos, radon, lead paint, underground storage tanks.
Wetlands and floodplain restrictions.

39
Q

The NJ Department of Environmental Protection (DEP)

A

oversee environmental regulations

40
Q

Frontage:

A

Linear measurement of the property along the street.

41
Q

Proration:

A

Adjustments made at closing to allocate costs or income between the buyer and seller (e.g., property taxes, insurance).

42
Q

Capitalization Rate

A

Used to estimate the value of an income-producing property

43
Q

Return on investment (ROI)

A

The ROI is calculated by dividing the final value minus the initial cost by the cost. ROI Formula: (Final Value – Initial Cost) / Cost = RO

44
Q

Price to rent ratio

A

The price to rent ratio is calculated by dividing the median home price by the median annual rent.

45
Q

Depth

A

Measurement of property from the front to the rear.

46
Q

Broker Price Opinion

A

An estimate of a property’s value prepared by a licensed real estate broker.

47
Q

Comparative Market Analysis (CMA)

A

A tool used to estimate a property’s value based on similar properties that have sold, are on the market, or were listed but didn’t sell.

48
Q

Riparian Rights

A

The rights of property owners to access and use water from a river or stream adjacent to their land.

49
Q

Fixture

A

An item of personal property that has been permanently attached to real estate, making it part of the property.

50
Q

Variance

A

An exception to zoning regulations granted to a property owner.

51
Q

Building Code:

A

Regulations specifying construction standards for buildings to ensure safety.

52
Q

Chain of Title:

A

A history of ownership for a specific property.

53
Q

Cloud on Title:

A

Any claim or encumbrance that may impair the title to real property.

54
Q

Condominium

A

A property where individual units are owned separately, and common areas are shared.

55
Q

Cooperative (Co-op):

A

A building owned by a corporation where residents own shares in the corporation instead of owning their unit.

56
Q

Multiple Listing Service (MLS):

A

A database of properties for sale shared among brokers.

57
Q

Metes and Bounds:

A

A method of describing land using boundaries and measurements.

58
Q

Judgment Lien

A

A court-ordered lien on property to satisfy a debt.

59
Q

Option Contract

A

: A contract giving one party the right to buy or lease property within a specified time

60
Q

Origination Fee:

A

: A fee charged by a lender for processing a loan application.

61
Q

Package Mortgage:

A

A mortgage covering both real and personal property.

62
Q

Partially Amortized Loan:

A

: A loan with regular payments and a balloon payment at the end.

63
Q

Percentage Lease:

A

: A lease where rent is based on a percentage of sales.

64
Q

Homeowners Association (HOA)

A

An organization managing a residential community’s common areas.

65
Q

Hypothecation:

A

Pledging property as security for a loan without surrendering possession.

66
Q

Implied Agency:

A

An agency relationship created through actions rather than a formal agreement.

67
Q

Hypothecation:

A

Pledging property as security for a loan without surrendering possession.

68
Q

Improvements

A

Additions to the land, such as buildings or landscaping, that increase value.

69
Q

Lis Pendens

A

A notice of a pending lawsuit involving property.

70
Q

Marketable Title:

A

A title free from significant defects.

71
Q

Mechanic’s Lien

A

A lien placed on a property for unpaid construction or repair work.

72
Q

Novation:

A

Replacing an old contract with a new one.

73
Q

Option Contract:

A

: A contract giving one party the right to buy or lease property within a specified time.

74
Q

Power of Attorney:

A

A legal document authorizing someone to act on another’s behalf

75
Q

Prepayment Penalty

A

fee for paying off a loan early.

76
Q

Principal

A

The original loan amount or the main party to a transaction.

77
Q

Real Estate Investment Trust (REIT):

A

A company owning, operating, or financing real estate.

78
Q

Real Property

A

Land and anything permanently attached to it.

79
Q

Restrictive Covenant:

A

A limitation on property use in a deed.

80
Q

Right of First Refusal:

A

he right to purchase property before others.

81
Q

Riparian Rights:

A

Water rights for landowners adjacent to a river or stream.

82
Q

Title Insurance:

A

Insurance protecting against title defects or ownership disputes.

83
Q

Ad Valorem Tax:

A

A property tax based on the assessed value of the property.

84
Q

Accrued Depreciation:

A

The loss in value of a property over time due to physical wear, functional obsolescence, or external factors.

85
Q

Loan-to-value ratio

A

Loan Amount / Assessed Value of the Property = Loan to Value Ratio

86
Q

Down payment

A

Sale Price x Percentage Payment = Down Payment Amount

87
Q

Capitalization rate

A

Net Operating Income / Purchase Price = Capitalization Rate

88
Q

Return on investment (ROI)

A

(Final Value – Initial Cost) / Cost = ROI

89
Q

Monthly mortgage payment

A

P [ i(1 + i)^n ] / [ (1 + i)^n – 1] = M
M = monthly mortgage payment
P = loan amount
i = monthly interest rate
n = number of payments (assume 30-yr, fixed)

90
Q

Price to rent ratio

A

Median Home Price / Median Annual Rent = Price to Rent Ratio

91
Q

Prorated taxes

A

By identifying the number of days remaining in the year and dividing it by 365, you’ll get the percentage of the tax bill that your buyer will need to pay.

92
Q

70% Rule

A

(ARV) x .70 − Estimated repair costs = Maximum buying price

93
Q

The 28 / 36 rule (Qualification Ratio)

A

The 28 in this rule suggests the home buyer can qualify for 28% of their gross monthly income
On the other hand, the 36 in this home buyer rule considers your client’s additional debt payments

Real Estate Salesperson (1 decks)

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