Unfamiliar Terms

Question 1

Estovers

Answer 1

legally allowed necessities, such as the right of a tenant to use timber on leased property to support a minimum need for fuel or repairs

Question 2

Noncontiguous

Answer 2

-Not touching

Question 3

Inchoate

Answer 3

A right not yet perfected

Question 4

Downzoning

Answer 4

downsizing..ex going from Commercial to Residential

Question 5

Spot Zoning

Answer 5

Small area of land that does not conform to the zoning of the rest of the area

Question 6

PUD

Answer 6

Mixed use developments

Question 7

City Plan Specifications

Answer 7

tax on real estate requiring property owners to pay for area improvements

Question 8

Floodplain

Answer 8

land located near bodies of water that tend to flood, generally restricted bldg

Question 9

Wetlands

Answer 9

groundwater close to surface may produce swamps, floodplains etc (also used for conservation)

Question 10

HVCC

Answer 10

makes sure borrowers receive a copy of appraisal report 3 days before closing

Question 11

Arms Length Transaction

Answer 11

those that mirror the definition of market value

Question 12

Intermediate theory

Answer 12

state allows lender to take possession of mortgaged real estate default

Question 13

Graduated Payment Mortgage

Answer 13

smaller payments then increased payments-causes negative amortization

Question 14

Subprime Loans

Answer 14

for people w/bad credit, higher interest rates and higher fees

Question 15

Power of Sale Clause

Answer 15

NO court (nonjudicial) for foreclosure

Question 16

Portfolio Loan

Answer 16

When an institution keeps the loans instead of selling to a secondary market

Question 17

Participation Mortgage

Answer 17

Lender receives interest and equity position in a project, known as Equity Kicker, or a % of income of the property

Question 18

Tandem Plan

Answer 18

when Ginnie Mae works with Fannie Mae in times of tight $$$ and high interest rates. FNMA purchases high risk while GNMA guarantees payments and absorbs the difference

Question 19

Truth in Lending Act

Answer 19

requires disclosure of loan terms and APR Developed the Homeownership & Equity Protection Act- Aimed at predatory mortgage loans

Question 20

Disintermediation

Answer 20

lenders experience a rapid withdrawal of funds into alternative investments which weakens the lenders position in the $$ market

Question 21

Property Insurance INfo

Answer 21

Homeowners Insurance HO-2, HO-3
Renters insurance HO-4
Condo Insurance HO-6
…for interior surfaces

Question 22

CLUE

Answer 22

(Claim activity and Property damage) reports are ordered by most insurance companies on property being purchased, insurers use the report to ascertain patterns of possible future claims and adjust their insurance premiums according to risk

Question 23

Underwater Mortgage

Answer 23

mortgage on a home in which the home is worth less than the amount owed to the banks that hold the mortgage on the home; often referred to as negative equity or an upside down mortgage

Question 24

Forbearance

Answer 24

promise not to do something that a party is legally entitled to do

Question 25

Reliction

Answer 25

New land is acquired as water recedes

Question 26

Indemnity

Answer 26

Security or Protection against a loss or financial burden

Question 27

Capital Gains

Answer 27

Profit from the Sale of Property
-Married couples may exclude as much as $500K from cap gains tax for profits on the sale of a principal residence if they file jointly.
must have occupied residency for 2 out of past 5 years
-Homeowners who file as individuals are entitled to a $250K exclusion each

Question 28

FORMS

Answer 28

1031 Tax Deferred Exchange-postpone paying taxes on the gain if reinvest proceeds in similar property
1040- If Self Employed how agents report income
1099S- Closing agents report details of closing
1099 MISC- Report Commission

Question 29

Fair Housing Rules

Answer 29

1st offense $16K
2nd offense w/in 5 years $37K Max
2+ offenses w/in 7 years $65K Max

Question 30

Leasehold estate

Answer 30

considered Personal Property

Question 31

Pyramiding

Answer 31

selling or refinancing currently owned property in order to purchase additional property

Question 32

Conveyance

Answer 32

Deed-Real Property

Bill of Sale- Personal Property

Question 33

UCC Uniform Commercial Code

Answer 33

law that governs documents and forms when personal property is being used as security for a loan/regulates the sale of an actual business and its personal property apart from the real estate