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Real Estate Review > State Exam Review > Flashcards

State Exam Review Flashcards

1
Q

How long is a real estate licensed issued for?

A

2 years, then must renew.

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2
Q

What kind of property requires a Property Condition Disclosure?

A

A resale. Not required on new construction or if the property is going through the courts.

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3
Q

If a broker’s license is suspended, how long is an agent’s license suspended?

A

Until you find another broker.

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4
Q

What should an agent do if a Broker’s license is revoked?

A

Find another broker.

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5
Q

Who negotiates and determines a broker’s commission?

A

Broker and Seller-Client

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6
Q

What fiduciary is broken if there is a financial loss?

A

Reasonable care and skill

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7
Q

What agreement guarantees a broker gets paid commission?

A

Exclusive right to sale

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8
Q

What agreement says a buyer doesn’t have to pay commission if they sale their own house?

A

Exclusive Agency Agreement

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9
Q

If an agent is running an open house, what are the buyers considered to the agent?

A

Customers

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10
Q

What explains to customers who an agent/broker represents?

A

Agency Disclosure document

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11
Q

What is first substantial contact?

A

First face-to-face talking real estate

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12
Q

What type of real estate agent represents client or customers in one area?

A

Special Agents (most all real estate agents)

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13
Q

What kind of agents are Property managers?

A

General Agents

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14
Q

What kind of agent has power of attorney?

A

Universal Agent

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15
Q

What is another name for a client?

A

Principle

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16
Q

What is another name for a principle?

A

Client

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17
Q

What is it called when you own a property by a river/stream?

A

Riparian Water Rights

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18
Q

What is it called if you own property by an ocean?

A

Littoral Water Rights

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19
Q

What kind of deed does a married couple have?

A

Deed by entirety. (Has survivorship)

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20
Q

What kind of deed do unmarried individuals have for survivorship rights?

A

Joint Deed

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21
Q

What kind of deed do unmarried individuals have with no survivorship rights?

A

Tenants in common

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22
Q

What is the term for one owner of property?

A

Severalty

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23
Q

What is the fullest ownership estate?

A

Fee Simple Estate

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24
Q

What type of deed would prohibit installing a pool?

A

Restrictive Control

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25
Q

Which lien always has priority to be paid?

A

Property Taxes

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26
Q

Who has to sign a deed?

A

All grantors

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27
Q

What protects against defects or gaps in a title chain?

A

Title Insurance

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28
Q

What legal description is used to make a survey?

A

metes and bounds

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29
Q

What kind of survey has a point of beginning?

A

metes and bounds

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30
Q

What commercial lease is based on the volume of tenant’s business?

A

Percentage Lease

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31
Q

Who signs Purchase Agreement first?

A

Buyer

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32
Q

What requires a lender to give borrowers a loan estimate within 3 days of application?

A

TILA RESPA or “Trid”

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33
Q

What dictates how financial terms are advertised?

A

TILA Reg Z

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34
Q

What kind of mortgage allows a buyer to get special help from a bank (lower interest rates, etc), then share profit with lender down the road?

A

Shared Equity Mortgage

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35
Q

What is the term for mortgages paid in equal monthly payments to pay off mortgage in full?

A

Fully amortizing

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36
Q

What is amortization?

A

Repayment of principal

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37
Q

What is the name for the bank in a mortgage transaction?

A

Mortgagee

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38
Q

What is the name for the borrower in a mortgage transaction?

A

Mortgagors

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39
Q

What document regulates construction standards?

A

Building permit and inspection

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40
Q

What document states it is safe to move into a building?

A

Certificate of Occupancy

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41
Q

What are the outside walls attached to framing called?

A

Sheathing

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42
Q

What measures the efficiency of insulation’s resistance to heat flow?

A

R-Factor

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43
Q

What is the R-Factor?

A

Measures the efficiency of insulation to heat flow resistance

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44
Q

What is a Title X?

A

Lead paint disclosure

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45
Q

What regulation concerns Lead Paint disclosure?

A

Title X

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46
Q

Buildings built before what year must have notification on lead paint?

A

1978

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47
Q

Does the seller have to test for lead paint?

A

No, but must allow the buyer to do so at buyer’s expense.

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48
Q

What insulation material is dangerous in powdered form?

A

Asbestos

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49
Q

What is the chemical used in freezing units?

A

Freon/CFC

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50
Q

What is an opinion of value called?

A

Appraisal

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51
Q

What is the term when an building is of an “old style” or outdated and is losing value?

A

Obselescence

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52
Q

What three pieces of data make up a comparative market analysis?

A

Recently sold properties, current listings, expired listings

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53
Q

What is the purpose of a CMA?

A

Purpose - recommended terms and value range

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54
Q

When was familial status and disability added to Fair Housing Act?

A

1988

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55
Q

What was added to the Fair Housing Act in 1988?

A

Familial status and disability

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56
Q

What is the term for an agent claiming property values will go down because minorities are moving in the area?

A

Blockbustering or panic selling

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57
Q

What protects against negligence?

A

Liability insurance

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58
Q

What kind of insurance policy do Condo owners get?

A

HO6

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59
Q

What kind of insurance policy do renters get?

A

H04

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60
Q

What do property taxes create against property?

A

Liens

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61
Q

What is a lien?

A

Evidence of debt

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62
Q

What properties must always pay full property taxes?

A

Vacation/2nd homes, no exceptions

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63
Q

What is the formula for Assessed Value?

A

Market value x level of assessment

Ex: $1M x 30% = $300k

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64
Q

Name an exception to the Fair Housing rules?

A

Renting a room in your own house/apartment - for example, a widow could say “no children or only women.”

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65
Q

What is discrimination in mortgage lending called?

A

Redlining

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66
Q

What is the formula for square feet?

A

Length x width

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67
Q

What creates a comprehensive plan for building?

A

Planning Board

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68
Q

Who is responsible for drinking water and sewage?

A

NYS Dept of Health

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69
Q

When must a seller provide the buyer a Property Condition Disclosure Form?

A

Before signing sales contract or seller gives $500 credit to buyer at closing

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70
Q

What kind of employee is a real estate agent?

A

Statutory non-employee (independent contractor)

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71
Q

Name the requirements for being an independent contractor.

A

Must have written contract with brokerage
Hours cannot be set
Gross check, no deductions
Files a schedule C

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72
Q

What fiduciary is broken if a broker commingles funds?

A

Accountability

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73
Q

What is it called when a broker mixes various monies into their account?

A

Commingling

74
Q

Where is the seller agency disclosed?

A

Agency Disclosure Form

75
Q

What is the one expense a broker can cover for an agent?

A

Errors and Omissions insurance

76
Q

Who does a trade fixture belong to in commercial real estate?

A

The tenant

77
Q

What is an example of trade fixtures in commercial real estate?

A

Display cabinets, fridges, etc.

78
Q

What easement is used by utility companies?

A

Easement in gross

79
Q

What easement is used by property owners?

A

Easement in appurtenances

80
Q

Define the Dominant in easements.

A

The person who uses another property for their needs

81
Q

Define the serviant in easements.

A

The person who’s property gets used

82
Q

Who is the grantor?

A

The Seller

83
Q

Who is the grantee?

A

The buyer

84
Q

What kind of deed removes a cloud on a title?

A

Quitclaim deed

85
Q

What kind of deed has no warranties?

A

Quitclaim deed

86
Q

What is a cloud on a title?

A

Gaps in chain of ownership

87
Q

What is it called when one records a deed with the county clerk?

A

Constructive notice

88
Q

What happens to the tenant if leased real estate is sold?

A

They stay until the end of the lease.

89
Q

When is a contract of sale completed?

A

At closing

90
Q

What is the purpose of earnest money?

A

Shows good faith, serves as a down payment

91
Q

What is a wrap-around mortgage?

A

A new second mortgage that combines with an existing mortgage to create a new mortgage

92
Q

What is the right of government to take private real estate for good of community, paying owner fair market value?

A

Eminent Domain

93
Q

What is the term for exercising Eminent Domain?

A

Condemnation

94
Q

What is the term when an individual dies without will or heirs and property goes to government?

A

Escheat

95
Q

What regulates the use of land?

A

Zoning Code

96
Q

What is an exception to a zoning code?

A

Variance

97
Q

Who issues variances?

A

Zoning Board of Appeals ZBA

98
Q

What is the law nicknamed the Superfund?

A

CERCLA

99
Q

What is responsible for the clean up of waste site and finding the person(s) responsible?

A

CERCLA - Superfund

100
Q

What keeps water out of construction/property?

A

Flashing

101
Q

What overhangs walls on the external part of a building?

A

Eaves

102
Q

What measures the speed that the ground aborts water/underground water?

A

Percolation rate

103
Q

What are 3 Appraisal approaches to Value?

A

Sales Comparison
Income Approach
Coast Approach

104
Q

What is included in the Sales Comparison appraisal approach?

A

3 similar recent sales

105
Q

What makes up the income appraisal approach?

A

office building/investors

106
Q

What is the cost appraisal approach used for?

A

Unique/unusual properties or new construction comps

107
Q

When was the first civil rights act?

A

1866

108
Q

What was the first protected class in the Civil Rights Act of 1866?

A

Race

109
Q

Are there any exceptions to the Civil Rights Act of 1866?

A

None.

110
Q

What is the formula for annual interest and monthly interest amounts?

A

Loan Amount x interest rate = annual interest
Annual interest / 12 = monthly interest

$100k x 6% = $6000 annual interest
$6000/12 = $500 monthly interest

111
Q

If there is an old structure that residents don’t want torn down, who do they appeal to?

A

Landmark Preservation

112
Q

What percentage does a property need to be insured for?

A

80% of building’s value

113
Q

What policy offers extra liability protection or large sums of insurance?

A

Umbrella

114
Q

What are ad volurum taxes based on?

A

Assessed Value?

115
Q

What is the term for taxes based on assessed value?

A

Ad Valorum taxes

116
Q

What kind of property is exempt from real estate assessment?

A

None.

117
Q

What kind of property is divided into a condo and coop?

A

Condop

118
Q

What clause allows a renter to purchase condo when it first comes up for sale?

A

Right of first refusal

119
Q

Who manages coop cooperation?

A

The Coop Board

120
Q

What is the lease clause that allows landlord to raise rents at specific times/intervals?

A

Escalation clause

121
Q

What lease clause allows landlords to raise rents immediately based on expenses?

A

Pass-thru

122
Q

What category is a warehouse distribution center in?

A

Manufacturing

123
Q

What is another name for a land lease?

A

Ground lease

124
Q

What is the formula for cash on cash?

A

Cash flow / down payment = cash on cash percentage

10k / 100k = 10%

125
Q

What lease clause dictates what tenant can and cannot do with the property?

A

Use Clause

126
Q

What is the difference between grows and net income?

A

Net is AFTER operating expenses

127
Q

What is the principal that states money today is more valuable than money in the future?

A

Time Value of Money, because you can use the money today to make more money

128
Q

What is salary bonus and commission considered?

A

Active Income

129
Q

What is rental income considered?

A

Passive income

130
Q

What are stocks and bonds income considered?

A

Portfolio income

131
Q

What can homeowners deduct from taxes?

A

Real Estate taxes and mortgage interest

132
Q

For the sale of a primary residence, what tax break does a seller get for capital gains tax?

A

Singles: $250k

Married couple: $500k

133
Q

How many years must a person live at primary residence to quality for capital gains tax break?

A

2 out of the last 5 years

134
Q

What is it called when a broker agent also acts as a mortgage broker?

A

Dual Agency

135
Q

What makes up an operating budget?

A

CURRENT income, profit, expenses

136
Q

What makes up a proforma?

A

FUTURE income, profit, expenses

137
Q

What license must one have to mange more than 1 owner’s property?

A

Broker license

138
Q

What are tax advantages on profits called?

A

Tax Shelters

139
Q

What is a 1031 Exchange?

A

Like kind tax deferred exchange of property that allows investors to defer payment of capital gains tax

140
Q

Who lends money?

A

Mortgage bankers only

141
Q

Who can NOT lend money?

A

Mortgage brokers, Mortgage loan originators

142
Q

Who approves new Condos/Coops and with what?

A

Attorney General with a CPS1

143
Q

What must an owner submit to make changes on a Coop

A

Alteration agreement

144
Q

What kind of estate is a Condo?

A

Freehold, conveyed by a deed

145
Q

What kind of estate is a Coop?

A

Leasehold, conveyed by proprietary lease and stock certificate

146
Q

What is put under foundation to prevent sinking?

A

Footings

147
Q

What states a deal must close by a specific date or there is a penalty?

A

Time of the essence Contract

148
Q

What measure heating/cooling?

A

BTUs

149
Q

What real estate law governs real estate?

A

12-A

150
Q

What is the term for representing both parties in a real estate transaction without consent?

A

Undisclosed dual agency

151
Q

What kind of lease requires tentant to pay most or all of operating expenses?

A

Net Lease

152
Q

What is the first deposit money paid in a sell?

A

earnest money

153
Q

Who holds the deposit money in NYS?

A

Seller’s attorney

154
Q

What kind of mortgage covers more than one property?

A

Blanket mortgage

155
Q

What does the 2nd mortgage market purchase?

A

Buys CLOSED loans from primary mortgage market

156
Q

What is it called when monthly mortgage payments do not cover interest due?

A

negative amortization

157
Q

What must occur before construction begins?

A

A building permit and inspection

158
Q

If an existing building was built to code at the time, but now zoning changes but it is allowed to continue doing business - what it is called?

A

Non-conforming use

159
Q

What document describes materials to be used in building?

A

Construction Building Specifications

160
Q

What does replacement cost cover?

A

Full loss of belongings

161
Q

Who has the burden of proof to challenge taxes?

A

Owner

162
Q

What is inflation?

A

Increase of money in circulation without increase in goods/services

163
Q

What is used to determine rent of commercial space?

A

Rentable Square footage (aka Gross Square Footage)

164
Q

What is another name for usable square footage?

A

Net square footage

165
Q

What is another name of rentable square footage?

A

Gross square footage

166
Q

What is the formula for Debt ratio?

A

Loan amount / asset value

Ex: $500k / $1M = 50%

167
Q

What is it called when you rent your rented space?

A

A sublease

168
Q

What is the landlord called?

A

Lessor

169
Q

What is the tenant called?

A

Lessee

170
Q

If tenant rents their space, what is it called and who is responsible?

A

Sublease/sublet and the tenant is responsible for the rent

171
Q

What is a dangerous radio active gas?

A

Radon

172
Q

What are architectural drawings called?

A

Blueprints

173
Q

What are studs?

A

Vertical support beams

174
Q

What are joists?

A

Horizontal support beams

175
Q

What system uses ducts and blower motor?

A

Forced Warm Air

176
Q

In the mortgage market, what happens when there is plenty of money flowing?

A

Rates go down

177
Q

In the mortgage market, what happens when there is tightened money flow?

A

Rates go up

178
Q

What does an agent do if a Broker doesn’t pay commission?

A

Sue them in court

179
Q

What is a violation of 12-A?

A

Misdemeasnor; penalty $1000 fine and/or 1 year in jail

180
Q

What is a record of ownership of property called?

A

Chain of title

181
Q

What are considered homestead properties?

A

1-4 family homes including condos

182
Q

What are properties that are not 1-4 family homes called?

A

Non-homestead

Real Estate Review (3 decks)

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