Set 9 (new) Flashcards
T/F: an easement in gross is usually for companies (such as railroads)
True
Easement in gross - companies, rail roads
T/F: * A note “creates” the debt. Mortgage is given as security for the note, giving the lender (mortgagee) the right to foreclose.
True
Regarding foreclosures, what is “equitable redemption”
Equitable redemption - borrower`s right to stop the foreclosure process by paying off the loan BEFORE the sale
T/F: If the buyer can’t get a loan, the earnest money should go back to him
True
If can’t get loan, earnest money back to buyer
T/F: Milrate is used to calculate monthly taxes
True
Milrate, calculate monthly taxes
T/F: Listing agent earns commission when finds buyer who is ready, willing & able. Even if seller doesn’t want to sell anymore for some reason
True
- Listing agent earns commission when finds buyer who is ready, willing & able. Even if seller doesn’t want to sell anymore for some reason
T/F: The Closing agent can be a title company, brokerage or attorney (and other ppl)
True
Closing agent - can be title company, brokerage, attorney, & others
T/F: At closing you usually need a buyer, seller, & closing agent
True
- Closing - usually need buyer, seller, & closing agent
T/F: A general agency is ongoing
True
- General agency - ongoing, e.g property manager
T/F: Private mortgage insurance (PMI) is required on conventional loans when borrower puts less than 20% down.
True
- Private mortgage insurance (PMI) required on conventional loans when borrower puts less than 20% down.
Does RESPA apply to all closing costs?
Yes
- RESPA - applies to all closing costs
T/F: For FHA loans, the gov insures the local lender
True
- FHA loan - gov insures local lender
T/F: If a loan has a alienation clause, that means the loan is assumable
False
Alienation clause - loan isn’t assumable, loan balance due on sale of property
T/F: With an easement, death of either the dominant tenement or servient tenement does not affect the appurtenant easement
True
- Death of either the dominant tenement (the land owner that is benefitted) or servient tenement (the land owner that is burdened) does not affect the appurtenant easement - the easement runs with the land
Do truth in lending laws apply to all the closing costs or just the loan?
Just the loan
Truth in lending laws - applies to just loan
T/F: the borrower signs the promissory note to create the debt
True
Promissory note - borrower signs to create debt, note can be bought/sold
T/F: Deeds must have granting clause
True
- Deeds must have granting clause
T/F: The terms principal and client are interchangeable
True
principal/client - hires the agent, terms r interchangeable
T/F: with a Purchase money mortgage, the seller helps finance part of loan on behalf of buyer
True
Purchase money mortgage - seller helps finance part of loan on behalf of buyer
T/F: A mortgage lien is an example of an appurtenance
False
mortgage lien - encumbrance, not an appurtenance.
T/F: a Lien or a deed restriction are examples of an encumbrance
true
Encumbrance - Lein, deed restriction/covenant
T/F: A Quitclaim deed clears up a cloudy title
True
Quitclaim deed - clears up cloudy title
Judicial vs non-judicial foreclosure
Judicial - go to court
Non-judicial - don’t go to court
Essentially, a judicial foreclosure means that the lender goes to court to get a judgment to foreclose on your home, while a non-judicial foreclosure means that the lender does not need to go to court
Judicial vs non-judicial foreclosure
Judicial - go to court
Non-judicial - don’t go to court
Essentially, a judicial foreclosure means that the lender goes to court to get a judgment to foreclose on your home, while a non-judicial foreclosure means that the lender does not need to go to court
T/F: A proprietary lease has to do with a co-op
True
A proprietary lease, also referred to as an occupancy agreement, gives a shareholder in a housing cooperative the right to occupy a particular dwelling unit. Homebuyers who join a co-op are purchasing shares in a corporation rather than acquiring real estate.
What kind of mortgage lets the borrower borrow money again if he wants
Open end mortgage
Open end mortgage - borrower can borrow again and again. Like line of credit
There is usually a set dollar limit on the additional amount that can be borrowed
T/F: Builders or sellers may offer a buydown mortgage option to help increase the chances of selling the property, by making it more affordable.
True
Makes offer more attractive
Buydown:
Basically a mortgage subsidy made by the seller on behalf of the homebuyer.
Typically, the seller contributes funds to an escrow account that subsidizes the loan during the first years, resulting in a lower monthly payment on the mortgage.
This lower payment allows the homebuyer to qualify more easily for the mortgage.
A _____ mortgage could be seen as a subsidy made by the seller on behalf of the homebuyer.
Buy-down mortgage
Buydown:
Typically, the seller contributes funds to an escrow account that subsidizes the loan during the first years, resulting in a lower monthly payment on the mortgage.
This lower payment allows the homebuyer to qualify more easily for the mortgage.
In a ______ mortgage, the seller pays extra money to buy down the interest rate on behalf of the buyer (similar to paying discount points)
Buy Down Mortgage
Basically a mortgage subsidy made by the seller on behalf of the homebuyer.
Typically, the seller contributes funds to an escrow account that subsidizes the loan during the first years, resulting in a lower monthly payment on the mortgage.
This lower payment allows the homebuyer to qualify more easily for the mortgage.
In real property law, _______ refers to a sudden loss of land, which results from the action of water. It differs from accretion, which describes a gradual addition to land resulting from the action of water.
Avulsion
In real property law, avulsion refers to a sudden loss of land, which results from the action of water. It differs from accretion, which describes a gradual addition to land resulting from the action of water.
What acronym is used to remember the 6 client duties (Care, Accounting, Loyalty, Disclosure, Obedience, Confidentiality)
CAL DOC
Care, Accounting, Loyalty
Disclosure, Obedience, Confidentiality
What acronym is used to remember the 3 customer duties (Fair, Honest, Accurate)
FHA
Fair, Honest, Accurate
T/F: Quitclaim deeds are usually used when the property involved has an outstanding mortgage
False
Quitclaim deeds usually when no mortgage
(Quitclaim deeds are most often for transferring property between family members or to cure a defect on the title, such as a misspelling of a name.)
A _____ deed would most likely be used to cure a defect on the title
Quitclaim deed
Quitclaim deeds are most often for transferring property between family members or to cure a defect on the title, such as a misspelling of a name.
Can a quitclaim deed be used to clear up a cloudy title?
Yes
Quitclaim deed - clears up cloudy title
Quitclaim deeds are most often for transferring property between family members or to cure a defect on the title, such as a misspelling of a name.
A _____ ____ is a court ruling that gives a creditor the right to take possession of a debtor’s real or personal property if the debtor fails to fulfill his or her contractual obligations.
Judgement Lien
A judgment lien is a court ruling that gives a creditor the right to take possession of a debtor’s real or personal property if the debtor fails to fulfill his or her contractual obligations. This lien may be made against an individual or business and allows the creditor to access assets such as the debtor’s business, personal property, and real estate to satisfy the judgment.
When an appraiser uses the word “effective age” what is she referring to?
Age of property based on its condition
the age of the property based upon its condition.
Effective age is a combination of many factors, including location, quality of construction and maintenance, architectural style, actual age, climate and so forth. A well-built building in a desirable location will have a much longer effective life than a cheaply constructed space in a poorly maintained office park setting.
T/F: The covenant in a deed which states that the grantor is the owner and has the right to convey the title is called covenant of power.
Falso
Called covenant of seisin
The covenant in a deed which states that the grantor is the owner and has the right to convey the title is called covenant of seisin.
T/F: Military status is protected by the Fair Housing Laws of Illinois but not by Federal Fair Housing Laws.
True
Military status is protected by the Fair Housing Laws of Illinois but not by Federal Fair Housing Laws.
T/F: The Closing Disclosure (CD) form is a statement of actual charges and adjustments.
True
The Closing Disclosure (CD) is a standard form in use which is used to itemize services and fees charged to the borrower by the lender. The form is called for in the TILA RESPA Integrated Disclosure (TRID).
The Closing Disclosure (CD) form is a statement of actual charges and adjustments.
MASTER LAND PLAN
Plan for a cities future growth
Lays out areas for residential, commercial, etc., which is why there are zoning regulations to make sure this comes to reality
Non-conforming use
Property was used for something before zoning changed and is allowed to stay the same
Example: someone had a house in a area that was later turned into a commercial district
A non-conforming use is where a property is used for something before a zoning change and is allowed to continue
Which of the following would be the BEST example of a buffer zone?
A » An agricultural property between multi-family dwellings and a commercial property
B » A single family property between two commercial properties
C » A single family property between a multi-family dwelling and a commercial property
D » A park between a high-rise apartment building and an industrial area
D » A park between a high-rise apartment building and an industrial area
A buffer zone is primarily to separate residential property from commercial property; therefore, a park between an apartment and industrial use is the best answer. (A) An agricultural property between multi-family and commercial is not as good a buffer as a park. (B) Single family between commercial properties would not be a buffer at all. (C) Single family between multi-family and commercial would also not be a buffer.
T/F: Real property escheats to the county where it is located. Personal property escheats to the state.
True
Real property escheats to the county where it is located. Personal property escheats to the state.
Which of the following is true regarding the Residential Real Property Disclosure Act?
Glossary Terms
Disclosure
A » It covers all residential properties with no exemptions
B » It does not allow for rescission under any circumstances
C » It is a warranty against future defects
D » The form should be completed by the seller and not the agent
D » The form should be completed by the seller and not the agent
The form should be completed by the seller and never by the agent.
T/F: All agents, regardless of representation, must disclose latent, or hidden, defects to potential buyers in Illinois.
True
Must disclose latent, or hidden, defects to potential buyers in Illinois.
But no requirement to point out patent, or obvious, defects that a buyer can see on their own.
T/F: A roof replacement is usually easy to remedy
False
Roof replacements usually expensive to remedy
“(D) Radon gas mitigation is fairly easy and inexpensive to remedy. What is not easy and inexpensive to remedy is (A) a structural foundation problem, (B) a roof replacement or (C) major water leaks in a basement.”
An item in a house that is usually easy and inexpensive to remedy is: ANSWERS A » a structural foundation issue B » a roof replacement C » major water leaks in a basement D » radon gas
D Radon gas
(D) Radon gas mitigation is fairly easy and inexpensive to remedy. What is not easy and inexpensive to remedy is (A) a structural foundation problem, (B) a roof replacement or (C) major water leaks in a basement.
Is radon gas usually expensive or inexpensive to remedy
inexpensive to remedy
“(D) Radon gas mitigation is fairly easy and inexpensive to remedy. What is not easy and inexpensive to remedy is (A) a structural foundation problem, (B) a roof replacement or (C) major water leaks in a basement.”
Installment contract is aka as what? (2 things)
“Contract for deed” or “land contract”
What type of interest does the buyer receive in the property after the seller accepts the offer?
A » Equitable
B » Easement
C » Record
D » Equity
Equitable interest
When the offer is accepted by the seller, the buyer has the right to receive title at closing. This right to get title in the future is called “equitable title.”
Do truth in lending laws (aka Regulation Z) apply to commercial zones?
No
(Federal law pertaining to lenders having to disclose all loan costs to borrowers)
Regulation Z applies to residential loans.
Commercial loans are not covered under Regulation Z.
How many days does a lender have from the time of receipt of loan application to give to the buyer an estimate of closing costs (The Loan Estimate)?
3 days
Under the TILA-RESPA Integrated Disclosure Rules (TRID), a lender must give to the borrower an estimate of closing costs (The Loan Estimate) within 3 days of receipt of loan application.
A lender charging an interest rate that is higher than allowed by laws would be violating:
A » fair housing laws
B » equal credit opportunity laws
C » usury laws
D » securities laws
C) Usury Laws
Usury laws set the maximum interest rate that can be charged by law. (A) Fair housing laws prohibit discrimination on things such as race and religion. (B) Equal credit opportunity laws bar lenders from discrimination. (D) Securities laws deal with stock transactions, etc.
Is sexual orientation covered under the Equal Credit Opportunity Act?
No
Sexual orientation is not covered under this act.
Is a lender allowed to reject a loan based on the marital status of the buyer?
No
The Equal Credit Opportunity Act prohibits discrimination by a lender in this area
T/F: With an amortized mortgage, interest and principal is paid each month
True
An amortized mortgage means to pay interest and principal with each payment.
