Scenario Based

Question 1

Professional liability insurance that protects real estate licensees from mistakes or negligence.

Answer 1

Errors and Omissions Insurance

Question 2

Lease for which the landlord pays all ownership expenses such as property taxes, insurance, etc.

Answer 2

Gross Lease

Question 3

A property developed for co-ownership, with each co-owner having a separate interest in an individual unit, combined with an undivided interest in the common areas of the property.

Answer 3

Condominium

Question 4

A form of property ownership in which several buyers purchase an interest in the same estate, with each party having the right to use the property and facilities for a designated period.

Answer 4

Timeshare

Question 5

When a landlord’s act (or failure to act) interferes with the tenant’s quiet enjoyment of the property, or makes the property unfit for its intended use, to such an extent that the tenant is forced to move out.

Answer 5

Constructive Eviction

Question 6

What tenants are actually paying in rent.

Answer 6

Contract Rent

Question 7

The rent the property could currently command on the open market

Answer 7

Economic rent

Question 8

Lease where tenants pay all taxes, insurance, etc., plus utilities and rent.

Answer 8

Net Lease

Question 9

A building owned by a corporation, where the residents are shareholders in the corporation; each shareholder receives a proprietary lease on an individual unit and the right to use the common areas.

Answer 9

Cooperative

Question 10

Exclusive, longer term lease given to a person who lives in a cooperative and owns stock in the cooperative.

Answer 10

Proprietary Lease