Real Estate Financing Practice Flashcards
What is a blanket loan?
A blanket loan covers more than one parcel or lot. It is usually used to finance subdivisions development. However, it can finance the purchase of a improved property or consolidate loans as well.
What is the package loan?
Includes real and personal property such as furniture, drapes, the kitchen range, dishwasher, as part of the sales price of the home.
what is a wraparound loan?
It enables a borrower with an existing mortgage or deed of trust loan to obtain additional financing from the second lender without paying off the first loan. The lender gives the borrower a new, increased loan at a higher interest rate and it assumes payment of the existing loan.
What is an open~end loan?
A mortgage loan that is expandable by increments up to maximum dollar amount, will loathing secured by the same original mortgage.
What is in the estate for years?
It’s a leasehold estate that continues for a definite period. That Maybe for years, months, weeks, or even days.
What is an estate from period to period?
Created when the landlord and tenant into into an agreement for an indefinite time-that is, the lease does not contain a specific expiration date. It continues until proper notice has been given.
What is a lease?
It’s a contract between an owner of real estate (the lessor) and a tenant (the leasee).
What is a leasehold estate?
It’s a tenants rights of possess real estate for the time of the lease.
What is an estate at Will?
It gives the tenants the right to possess the property with the landlord consent for an unspecified or uncertain time. It continues until it’s terminated by either party giving proper notice.
What is an estate at sufferance?
Arises when a tenant lawfully possess real property continues in possession of the premises without the landlord consent after the rights expired
What is a gross lease?
It’s where the tenant pays fixed rent they also may pay taxes, repairs, insurance, etc. Residential and commercial office leases are most often gross leases
What is a net lease?
A net lease they pay a fixed rent plus all or most property charges. Most often associated with large commercial and industrial leases.
What is a percentage lease?
Tenant pays a fixed rent plus a percent of the gross sales. Received by the tenant doing business on the leased property. The percentages charged is negotiable and varies depending upon the nature of the business, location of the property and general economic conditions.
What is a variable lease?
Increase in the rental charges during the lease period.
What is a ground lease?
It’s when an owner of a piece of land allows the tenant to erect the building on the land, the owner still owns the land and the tenant pays rent for the grounds. Separate ownership of the land and the building.
Oil and gas lease?
When an oil company leases land to explore for oil and gas, a special lease agreement must be negotiated.
What is a lease purchase?
Part of the rent is applied towards the purchase price of the property until it is reduced to an amount for which the tenet can obtain financing or purchased the property out right, depending on the terms of the lease purchase agreement.
What is a sale and leaseback?
It’s an arrangement where the owners of a property sell the property and then lease it back again for an agreed period and Rental.
Which type of insurance coverages insures an employer gives most claims for job related injuries?
Worker’s Compensation
Property managers is offered a choice of three insurance policies with different deductibles. If the property manager select the policy with the highest deductible, which risk management technique is being used?
Retaining risk
Adaptation of property specifications to suit tennant requirements are…
Tenant improvements.
Avoid, control, transfer, or retain are the four alternative techniques of…
Risk management
The manager of a commercial building has many responsibilities in connection with the operation and maintenance of the structure. The manager would normally be considered the agent of…
Owner
A high-rise apartment building burns to the ground. What type of insurance covers the landlord against the resulting loss of rent?
Consequential loss, use, and occupancy
A property manager who enters into a management agreement with an owner is usually a…..
General agent… One was authorized by principle to represent the principal in a broad range of matters related to particular business or activity.
What is a universal agent?
As a person empowered to do anything the principal could do personally. They act on behalf of the principal and is virtually unlimited.
What is a special agent? Or a limited agent
Authorized to represent the principal in one specific act or business transaction only.
What is a designated agent?
It’s a person authorized by the real estate broker to act as the agent of a specific principle.
What is express agency?
It’s where the parties formally express their intentions to establish an agency and state is terms and conditions. It could be either oral or written.
What is implied agency?
This occurs when the actions of the parties indicated that they mutually consent to an agency. A licensee acts on behalf of another party at the party’s agent.
What is a non-agent?
Also known as a facilitator, inter mediator, transactional broker, transactional coordinator, or contract broker. Assist one or both parties with the transaction without representing either parties interest and often is subject to specific statutory responsibilities
What is price-fixing?
It’s setting the prices for products or services rather than letting the competition and open market except wish those prices. And real estate price-fixing occurs when competing brokers agrees to set sales commissions, fees, or management rates.
What is group boycotting?
It’s when one or more business gets together to conspire against another business
What is a tie in agreement?
It’s an agreement to sell one product buyer has to purchases another product as well. So the first desired product is tied to the purchase of the second less desirable product.
What is a net listing?
Specify that the seller will receive a net amount of money from any sale, but the excess of going to the listing broker as commission.
What is eminent domain?
It is the right of the government to acquire privately owned property for public use.
What is condemnation?
Is the process by which the government exercises the right of eminent domain by either judicial or administrative proceedings.
What is taxation?
It’s a charge on real estate to raise funds to meet public needs of government.
What is life estate?
It is a freehold estate limited in duration to a life of the owner or the life of some other designated person or persons. It is not inheritable.
What it is remainder and reversion?
The fee simple owner who creates a life estate must plan for its future ownership. The life estate and is replaced by fee simple estate. The future owner of the fee simple estate may be designated in one or two ways;
Remainder interest-creator of the life estate may name a as the person to whom the property will pass on when the life estate ends.
Reversionary interest-the creator of the life Estate may choose not to name a remainderman. In that case, ownership reverts to the original owner upon the end of the life estate.
What is a legal life estate?
Not created voluntarily by an owner. Rather, it is form of life estate established by state law.
What is the homestead?
It is a legal life estate in real estate occupied as a family home. An effect, the home or at least some part of it is protected from most creditors during the office lifetime.
What is a encumbrance?
It is a claim, charge, or a liability that attaches to real estate.
What is the deed restriction?
Private restrictions that affect the use of the land. Was placed under the by the previous owner, they run with the land, limiting the use of the property and binding to all grantees.
What is an easement?
The right to use the land of another for particular purpose.
What is an appurtenant easement?
It is attached to the ownership of one parcel and allows this owner the use of a neighbor’s land.
What is an easement in gross?
It’s an individual or company interest in the right to use someone else’s land. For example a railroad right-of-way is a easement a gross, as are the right way of utility easements such as for pipeline or hi-tension powerline.
What is an easement by necessity?
Created when a owner sells a parcel of land and has no access to the street or public way except over the sellers remaining land
What is easement by prescription?
Person uses another person’s land for certain period of time. Ranges from 10 to 21 years. Must be open visible and notorious and the owner must have been able to learn of it.
What is a statutory lien?
It’s created by regulating taxes, it’s a involuntary, statutory lien. Without any action by the property owner.
What is an equitable lien?
A court ordered judgment that requires a debtor to pay the balance on a delinquent charged account.
What is a general lien?
It’s a charge that affects all the property, both real and personal
What is it specific lien?
Specific property and effects of particular property. Deals with vendors liens, mechanics lien, Mortgage Lane, real estate tax lien, and liens for special assessments and utilities.
What is a subordination agreement?
It’s a written agreement between lienholders to change the party of mortgage, judgments and other ways.
What is ad valorem?
A Latin word for according to value. Taxes based on the value of a property being taxed and are specific, involuntary, statutory liens.
What is a mil?
It’s one 1/1000 of a dollar or .001
What is special assessments?
Taxes charged on real estate to fund public improvements to the property. Property owners are required to pay for the improvements because the property benefits directly from them.
What are unilateral contracts?
It’s a one-sided agreement. One party makes a promise as to induce the second party to do something. The second part is not legally obligated to act. However, the second party does comply, the first party is obligated to keep a promise
What is express contract?
It’s when the party state retirement show their intentions and words, either oral or written. Most real estate contracts are expressed contracts they have been committed to writing.
What is a voidable contract?
Appears to be valid but maybe rescind it disaffirmed I want to both parties based on some legal principle. Considered by the courts to be valid if the party who has the option to disaffirm the agreement is not do so within a period of time
What is unenforceable contract?
They also appeared to be valid; however, neither party can sue the other two forced performance.
What is novation?
The substitution of a new contract for an existing contract.
What is a land contract? Also called a contract for deed, a bond for title, and installment contract, a land sales contract, or articles of agreement for warranty deed.
The seller retains legal title. The buyer called Ivin D takes possession and gets equitable title to the property. The buyer agrees to get the seller down payment and pay regular monthly installments of principal and interest of a number of years. The bar also pays real estate taxes, insurance premiums, repairs, and upkeep on the property. The seller is not obligated to execute and deliver the deed to the bar until the terms of the agreement are met.
What is a habendum clause?
It defines ownership to be enjoyed it may follow the granting clause. It begins with the words to have and to hold.
What is an acknowledgment?
The formal declaration under of that a person who signs a written document though so voluntarily and that the signature is genuine.
What is delivery and acceptance?
The title is not considered transferred until the deed is actually delivered to and excepted by the grantee.
What is a Gen. warranty deed?
It provides the greatest protection to the bar because the grantor is legally bound by certain covenants promises or warranties.
What is covenant of seisin?
Once that they own the property and have the right to convey title to it. Seisin simply means possession.
What is covenant against encumbrances?
The grantor warrants that the property is free from liens or encumbrances, except for any specifically stated in the deed.
What is covenant of quiet enjoyment?
The grantor guarantees that the grantees title will be good against third parties who might bring court actions to establish superior title to the property.
What is covenant of quiet enjoyment?
The grantor guarantees that the grantees title will be good against third parties who might bring court actions to establish Se. title to the property.
What is covenant of warranty forever?
The grantor promises to compensate the grantee for loss sustained if the title fails at any time in the future
What is a special warranty deed?
Contains two basic warranties; at the grantor received title and that the property was not encumbered during the time to grantor held title except otherwise noted in the date
What is a bargain and sale deed?
Contains no express warranties against encumbrances
What is a quitclaim deed?
Provides the grantee with the least protection of any deed. He carries no covenants or warranties and generally conveys only what interest the Gretchin may have when the deed is delivered.
