Real Estate Test Unit 17

Question 1

actual eviction

Answer 1

the legal process that results in a tenant’s being physically removed from leased premises

Question 2

constructive eviction

Answer 2

actions of a landlord that so materially disturb or impair a tenant’s enjoyment of the leased premises that the tenant is effectively forced to move out and terminate the lease without liability for any further rent

Question 3

estate (tenancy) at sufferance

Answer 3

the tenancy of a lessee who lawfully comes into possession of a landlord’s real estate but who continues to occupy the premises improperly after the lease rights have expired

Question 4

estate (tenancy) at will

Answer 4

an estate that gives the lessee the right to possession until the estate is terminated by either party; the term of this estate is indefinite

Question 5

estate (tenancy) for years

Answer 5

an interest for a certain, exact period of time in property leased for a specified consideration

Question 6

estate (tenancy) from period to period

Answer 6

an interest in leased property that continues from period to period- week to week, month to month, or year to year

Question 7

gross lease

Answer 7

a lease of property according to which a landlord pays all property charges regularly incurred through ownership, such as repairs, taxes, insurance, and operating expenses. most residential leases are gross leases

Question 8

ground lease

Answer 8

a lease of land only, on which the tenant usually owns a building or is required to build as specified in the lease. such leases are usually long-term net leases; the tenant’s rights and obligations continue until the lease expires or is terminated through default

Question 9

holdover tenancy

Answer 9

a tenancy in which a lessee retains possession of leased property after the lease has expired and the landlord, by continuing to accept rent, agrees to the tenant’s continued occupancy as defined by state law

Question 10

lease option

Answer 10

a lease under which the tenant has the right to purchase the property at an agreed upon price either during the lease term or at its end

Question 11

lease purchase

Answer 11

the purchase of real property, the consummation of which is preceded by a lease, usually long term, that is typically done for tax or financing purposes

Question 12

leasehold estate

Answer 12

a tenant’s right to occupy real estate during the term of a lease, generally considered a personal property interest, although a long-term lease may be eligible for treatment as real property for financing purposes

Question 13

lease

Answer 13

a written or oral contract between a landlord (the lessor) and a tenant (the lessee) that transfers the right to exclusive possession and use of the landlord’s real property to the lessee for a specified period of time and for a stated consideration (rent). by state law, leases for longer than a certain period of time (generally one year) must be in writing to be enforceable

Question 14

month-to-month tenancy

Answer 14

a periodic tenancy under which the tenant rents for one month at a time. in the absence of a rental agreement (oral or written), a tenancy is generally considered to be month to month

Question 15

net lease

Answer 15

a lease requiring the tenant to pay not only rent but also costs incurred in maintaining the property, including taxes, insurance, utilities, and repairs

Question 16

non disturbance clause

Answer 16

a mortgage clause stating that the mortgagee agrees not to terminate the tenancies of the lessees in the event the mortgagee forecloses on the mortgagor-lessor’s building

Question 17

percentage lease

Answer 17

a lease, commonly used for commercial property, whose rental is based on the tenant’s gross sales at the premises; it usually stipulates a base monthly rental plus a percentage of any gross sales above a certain amount

Question 18

purchase option

Answer 18

the right given by a lease to the tenant to purchase the property at a predetermined price within a certain period, possibly the lease term

Question 19

renewal option

Answer 19

a clause in a lease that grants the lessee the privilege of renewing the lease

Question 20

rent

Answer 20

a fixed, periodic payment made by a tenant of a property to the owner for possession and use, usually by prior agreement of the parties

Question 21

reversionary right

Answer 21

the return of the rights of possession and quiet enjoyment to the lessor at the expiration of a lease

Question 22

right of first refusal

Answer 22

a clause allowing the tenant the opportunity to buy the property before the owner accepts an offer from another party

Question 23

security deposit

Answer 23

a payment by a tenant, held by the landlord during the lease term, and kept (wholly or partially) on default or on destruction of the premises by the tenant

Question 24

subjective value

Answer 24

the perceived value of an item based on the benefits given to the owner

Question 25

suit for possession

Answer 25

a court suit initiated by a landlord to evict a tenant from leased premises after the tenant has breached one of the terms of the lease or has held possession of the property after the lease’s expiration