S.R. 7 Flashcards
A sudden and violent change to the bed or course of a stream or river causing a measurable loss or addition to land.
Avulsions
An owner or possessor of land that abuts a natural stream or river.
Riparian Owner
The natural erosion of soil on one side of a watercourse and the gradual addition of soil to the other side.
Accretions
Part of the shore zone of a body of water such as a pond or lake.
Littoral
A type of personal property which, in its most general definition, can include any asset other than real estate.
Chattel
Property placed on or annexed to rented real estate by a tenant for the purpose of the conduct of a trade business.
Trade Fixtures
The crops or products of the land, which legally belong to a tenant.
Emblements
Oldest type of legal description. Clockwise direction. Has the words ‘beginning at a point’ or ‘point of beginning.’
Metes and Bounds
Primarily used west of the Mississippi. 1 Township = 6 mi. x 6 mi. (36 sq mi) = 36 sections 1 section = 1 mi. x 1 mi. (1 sq mi) = 640 acres 1 Acre = 43,560 sq ft. 1 Mile = 5,280 ft.
Government Rectangular Survey System
It is sometimes referred to as the Recorded Plat Survey System or the Recorded Map Survey System. It is the newest type of legal description.
Lot and Block Survey System
A burden, obstruction, or impediment on property that lessens its value or makes it less marketable.
Encumbrance
A legal obligation imposed in a deed by the seller upon the buyer of real estate to do or not to do something.
Restrictive Covenant
A creditor’s claim against property to secure repayment of a debt.
Lien
General contractor - at time of making contract or within 10 days after the work in agreed upon. Subcontractor - 45 days of starting work. Draft, serve and file a mechanic’s lien within 120 days of the last date of contribution. Commence a mechanic’s lien foreclosure action within one year of the last date of contribution.
Mechanic’s Lien Pre-lien Notice
A building, a part of a building, or an obstruction that physically intrudes upon, overlaps, or trespasses upon the property of another.
Encroachment
Tax year runs Januray 1 - December 31. Payable in two installments: May 15 and October 15.
Property Taxes in MN
P - Principal
I - Interest
T - Taxes
I - Insurance
PITI
A tax based on the assessed value of real estate or personal property.
Ad Valorem Tax
An assessment that has begun, but not yet completed OR an assessment that has been approved but not yet leveled.
Pending Assessments
An assessment that has been billed, work completed, but not yet paid.
Levied Assessment
The reversion of property to the state in the event that the owner dies intestate and with no legal heirs.
Escheat
The right of any governmental body to enact and enforce regulations for the order, safety, health, morals and general welfare of the public; this does not allow for reversionary rights.
Police Power
A court proceeding.
Habeas Corpus
The right of the government or a public utility to acquire property for necessary public use by condemnation and the owner must be fairly compensated.
Eminent Domain
A real estate term in which the owner is entitled to: The entire property with unconditional power of disposition during the owner’s life and, the property descends to the owner’s heirs and legal representative upon the owner’s death intestate. The most common type of value sought.
Fee Simple Absolute
A type of property ownership in which the grant of title or duration of ownership is dependent on a specified condition. Also known as Fee Simple Determinable or Determinable Fee.
Fee Simple Defeasible
A freehold interest (in real property) that expires upon the death of the owner or some other specified person.
Life Estate
The person who is to receive possession of the property after the death of a Life Tenant.
Remainderman
A leasehold estate is an ownership interest in land in which a lessee or a tenant holds real property by some form of title from a lessor or landlord.
Leasehold
A state law that provides that certain contracts must be in writing in order to be enforceable. Applies to deeds, mortgages and other real estate contracts, with the exception of leases for periods shorter than 12 months, in residential properties, containing fewer than 12 units.
Statute of Frauds
A fixed-term tenancy or tenancy for years lasts for some fixed period of time.
Tenancy for Years
An estate that exists for some period of time, determined by the term of the payment of rent.
Periodic
Describes any leasehold where either the landlord or the tenant may terminate at any time on reasonable notice. It usually occurs in the absence of a lease, or where the tenancy is not for consideration.
Tenancy at Will
A tenancy at sufferance exists when a tenant remains in possession of property after the expiration of his lease, and until the landlord acts to eject the tenant from the property.
Tenancy at Sufferance
An area of land that separates two drastically different land use zones.
Buffer Zone
The act or process of revising an entire ‘zone’.
Amend
Use of land that lawfully existed before an enactment of a zoning ordinance and that may be maintained after the effective date of the ordinance, although it no longer complies with use restrictions newly applicable to the area.
Nonconforming Use
An administrative exception to land use regulations, generally in order to compensate for a deficiency in a real property which would prevent the property from complying with the zoning regulation.
Variance
Allows a city or county to consider special uses which may be essential or desirable to a particular community, but which are not allowed as a matter of right within a zoning district through a public hearing process.
Conditional Use Permit
Property owned by two or more people at the same tie with equal shares. When one joint tenant dies, his/her interest automatically vests in the surviving joint tenant(s) by operation of law.
Joint Tenancy
Property owned by two or more persons at the same time. The proportionate interests and right to possess and enjoy property between the tenants in common do not have to be equal. Upon death, the decedent’s interest passes to his/her heirs named in the will, who then become new tenants in common with the surviving tenants.
Tenants in Common
An individual owns a property.
Tenancy in Severalty
A corporation owns a property.
Syndication
The act of conveying or transferring Title and Possession of property.
Alienation
The right of ownership to a tract of land, usually granted by the federal or state government to an individual or private company.
Land Patent
The gift of land by its owner for a public use and the acceptance of it by a unit of government.
Dedication
Explicitly promises (warrants) that the grantor/seller holds good title to the property. Five promises:
- Warranty of seisin
- Quiet enjoyment
- Right to convey
- Freedom from encumbrance
- Good forever
Warranty Deed
Transfers any ownership interest the grantor/seller has in the property, but makes no promises or guarantees about what that interest is or that title is good.
Quitclaim Deed
Implies that the grantor has the right to convey title but makes no warranties against encumbrances. This type of deed is most commonly used by court officials or fiduciaries that hold the property by force of law rather than by title, such as properties seized for unpaid taxes and sold at sheriff’s sale.
Bargain and Sale Deed
The grantor conveys title to the grantee and agrees to protect the grantee against title defects or claims asserted by the grantor and those persons whose right to assert a claim against the title arose during the period the grantor held title to the property.
Special Limited Warranty Deed
A written instrument given to pass title of personal property from seller to a buyer.
Bill of Sale
Linkages from grantor to grantee.
Chain of Title
Once an instrument affecting the title to real estate has been recorded, the law holds that everyone is deemed to know of its existence, even if they haven’t searched the records in the recorder’s office.
Doctrine of Constructive Notice
.0023
Mortgage Registry Tax
.0033
State Deed Tax Rate
15 continuous years. Open for all to see. Exclusive. Hostile.
Adverse Possession
The right of an owner to cross over another’s property for a special necessary purpose.
Easement by Necessity
$390,000 Agricultural - $975,000 Half acre within city, 160 acres everywhere else.
Minnesota Homestead Exemption Amounts
Transfers duties but not responsibility.
Assignment
A contract transferred by the novation process transfers all rights and obligations from the original owner to the new owner.
Novation
An addition to the agreement and is a part of it.
Addendum
A change to the agreement after it was originally accepted.
Amendment
A single rent is set for a definite period of time.
Flat or Fixed Lease
The tenant pays a flat monthly amount. The landlord pays for all operating costs for the building. In some cases, the tenant pays for its electricity, heat, and air conditioning. This type of lease ofte ncontains an escalation clause that allows the landlord to increase the rent annually to offset increased expenses.
Gross Lease
The rent is increased at a set amount on an annual basis during the life of the agreement. The increase is to cover the landlord’s expected increases in expenses. The increase is based on estimated rather than actual costs.
Step Lease
The rent goes up in proportion to an economic index.
Cost-of-Living Lease
The tenant pays a base monthly rent plus some of the expenses. The increases are based on actual costs rather than on estimates. The rent increases at the time that the landlord incurs an increase in costs. In some cases, the tenant pays rent plus all of the real estate taxes. If leasing only a portion of the building, the tenant will pay a proportionate share of the taxes.
Net Lease
The tenant pays the base rental amount, real estate taxes, and insurance premiums. The insurance and real estate taxes are allocated among the tenants based on the proportion of space occupied.
Net-Net Lease
The tenant pays the base rental amount, real estate taxes, and insurance premiums. The insurance and real estate taxes are allocated among the tenants based on the proportion of space occupied.
Net-Net-Net Lease
The tenant pays either both a base amount ad a percentage of gross income or, depending on which is higher, pays a base amount or a percentage of the business’s gross income.
Percentage Lease
Rental agreement in which the rent is adjusted periodically based on changes to an agreed-upon index, usually a general economic index such as the Consumer Price Index. The lease provision that calls for the adjustment is an escalation clause.
Index Lease
A leasehold estate in which the lessor has acquired a leasehold interest from an owner or another lessee, and has in turn subleased the premises to a subtenant. All leases that lie between the original lessor and the ultimate subtenant are sandwich leases.
Sandwich Lease
Conveyance of interest in a property by a seller who simultaneously leases (back) the property in order to maintain uninterrupted occupancy while recognizing a capital gain on the sale of the asset.
Sale-Leaseback
Mortgage that includes personal property.
Package Mortgage
Mortgage with more than one parcel pledged.
Blanket Mortgage
Mortgage that allows the borrower to obtain further advances at a later date.
Open-End Mortgage
Mortgage where seller advances money to the buyer and takes a mortgage. Title transfers and seller has lien.
Purchase Money Mortgage
Loan to value ratio greater than 80% Buyer (mortgagor) pays private mortgage insurance (PMI) to protect lender against losses due to non payent. Think of it as default insurance.
Insured Conventional
New construction loans. Interim financing is available in installments as improvements are completed (obligatory advances). Typically short term.
Construction Mortgage
Junior financing that includes the remaining first mortgage balance, which the buyer does NOT assume. Buyer pays second lender (usually the seller) who makes payments on the first mortgage.
Wraparound Mortgage
Mortgage that may include rate and/or payment caps. Interest rate adjusts based on economic index or indicators.
Adjustable Rate Mortgage
Mortgage that commonly uses negative amortization. Payments level off after three to five years. Offers lower payments in the beginning.
Graduated Payment Mortgage
Mortgage that is repaid upon: Sale of the property. Balance reaches maximum limit. Mortgagee pays mortgagor monthly.
Reverse Annuity Mortgage
Mortgage payment plus tax and insurance escrow - PITI. Minnesota requires lender to pay interest on funds in escrow with most conventional loans.
Budget Mortgage
Meets all legal requirements. Binding and enforceable in court.
Valid Contract
No legal effect; unenforceable by either party. Lacks any of the basic elements of a valid contract.
Void Contract
A contract that may be treated as legally unenforceable at the option of a party (usually the injured party) but remains enforceable until that party exercises her option.
Voidable Contract
An agreement in which each of the parties to the contract makes a promise or promises to the other party.
Bilateral Contract
Only one party to the contract makes a promise. The other party performs.
Unilateral Contract
Agreement not to perform.
Forbearance
Specific Performance Liquidated Damages Penal Damages Recission Partial Performance
Breach of Contract - Law of Remedies
Vendor = Seller
Vendee = Buyer
Vendor grants equitable title to the vendee. When the amount of the purchase is paid, the vendor is obligated to deliver legal title to the vendee. Needs to be recorded by the vendee within 4 months of the agreement. Civil penalty if not recorded equals 2% of the principal. If vendee defaults, remedy is cancellation. Equitable redemption period is 60 days from receipt of notice in contacts after July 31, 1985.
Contract for Deed
An additional period of time between default and foreclosure, known as a period of equitable redemption, may allow the mortgagor to accrue sufficient cash flow to not only avoid foreclosure but to mitigate under-investment in non-default states.
Equitable Redemption Period
Allows the mortgagor to redeem the mortgage even after foreclosure sale. A six month period is allowed for the mortgagor to redeem the mortgage by payment of the foreclosure sale price plus a statutory rate of interest to the sale purchaser. Exceptions:
12 month if you have more than 1/3 paid
More than 40 acres
More than 10 acres and in agricultural use
More than 10 acres and mortgage originated before 7/1/1987
5 weeks is property is abondoned
Statutory Redemption Period
Lender has the power to foreclose without going to court.
Optional provision.
Power of Sale Clause
Lender has the right to accelerate foreclosure if one of the following if one of the following promises is broken:
Non-payment of taxes
Insurance coverage lapse
Not keeping up on repairs/upkeep
Removal of improvements
Non payment of principle and interest
Enforce the due-on-sale-clause - allows the lender to accelerate the loan if the property is sold or transferred.
Acceleration Clause
