Vocabulary: Real Estate License - Utah Law Flashcards
Study for the Utah Law section of the Utah Real Estate License Exam.
Recission
The right of an individual involved in a contract to return to a state identical to that before they entered into the agreement, due to courts not recognizing the contract as legally binding. In many cases, rescission may be an option if there is a material error in the contract, among other reasons.
Abrogation
The act of cancelling, repealing or annulling. \Then a transaction is closed, the REPC is annulled, except for those clauses specifically stated to extend beyond the closing in the Abrogation Clause.
Acceptance
When used in reference to a real estate transaction, acceptance occurs when the transaction is signed and agreed to by all parties and their agreement is communicated to all parties to the transaction.
Accretion
The addition of land, such as by deposits of sand or soil which occur naturally from a body of water as it runs along the property.
Active Licensee
One who has (a) paid all applicable fees and (b) affiliated with a principal brokerage.
Addendum
An addition to a real estate transaction written and signed on a legal form recognized in the real estate profession.
Administrative Procedures
Clerical processes involved in an activity,
such as those used in handling complaints made against licensees.
Administrative Rules
Rules enacted by the Utah Real Estate Commission, which have the same force and effect as statutes.
Affirmative Duties
Actions which favor a particular party, such as a client, and which the licensee has an obligation to complete.
Agency Agreement
The contract in which a buyer or renter agrees to
representation by a real estate licensee and the licensee agrees to provide that representation.
Agency Disclosure
The disclosure required by every real estate licensee as to who they are representing in a real estate transaction.
Associate Broker
A real estate licensee who has completed the additional education and experience required for broker status and applied for a broker license, but does not currently manage a real estate office or own a real estate firm.
Auctions
An event in which a product, such as real estate property, is
offered in a group setting in which individuals may compete and outbid each
other to acquire the property offered.
Avulsion
The violent removal of land, such as in a flood.
Assignment
When used in regard to a lease or sale of real property, the act of taking the place of a buyer or prospective renter to fulfill the responsibilities and benefit from a real estate transaction. Most Utah
contracts are fully assignable, but in real estate, all parties must agree to any assignment.
Branch Manager
A.n associated broker who manages a branch office under the supervision of the principal broker.
Branch Office
A real estate office affiliated with and operating under the same name as a principal brokerage but located at an address different from the main office.
Business Opportunity
The sale, lease, or exchange of any business which
includes an interest in real estate.
Brokerage
A real estate sales brokerage or a property management company.
CC&R’s
Covenants, conditions and restrictions pertaining to real estate property Ownership.
Certification
The authorization issued by the Utah Division to (a) establish and operate a real estate school which provides courses approved for licensing requirements, (b) provide courses approved for renewal requirements, or ( c) function as a real estate instructor.
Client
A customer who has requested representation by a real estate licensee and their broker is now a broker’s client
Closing
When settlement has been completed and proceeds of any new loan have been delivered by the lender to the seller or the escrow company and
the transaction is recorded. All of these actions must be completed within four days of the settlement.
Code of Ethics
Standards of practice adopted by a group, such as the National Association of Realtors.
Commingling
Mixing trust funds with personal or operating funds.
Common Areas
Parts of a property available for all residents to use, such as the swimming pool in a condominium complex.
Company Registration
Registration issued to a corporation, partnership~
Limited Liability Company, association, or other legal entity of a real estate brokerage. A company registration is also issued to an individual or an
individual’s professional corporation.
Condominium
Absolute ownership of a unit in a multi-unit building based on a legal description of the air space occupied by that unit, plus an undivided interest in the common areas or elements owned jointly by the
other condominium owners in a specific development.
Construction Access
The right to enter the grounds of a property during its construction.
Construction Compliance
In accordance with all federal, state and local
government laws, ordinances, and regulations, and in compliance with restrictive covenants applicable to the lot.
Construction Loan
A loan taken out by the future owner or builder of a
property, typically paid off by a permanent loan taken out by the buyer when the construction is complete.
Continuing Education (CE)
Professional education required as a condition of
renewal in accordance with Subsection 61-2-9(2)(a).
Contract Deadlines
Time requirements for various actions to be completed as set forth in the REPC.
Conveyance
Transfer of ownership of real property.
Counter Offer
A legal action in which a buyer or seller alters the terms of a presented offer and asks the other party to accept these altered terms.
Customer
Someone interested in buying a product or property, but is not represented by an agent or broker.
DBA (doing business as)
The authority issued by the Division of Corporations and Commercial Code to transact business under an assumed name.
Declaration
In the case of a condominium project, the instrument which establishes its compliance with the Condominium Act.
Default
When a party to a real estate transaction does not perform as they’ve agreed, they are said to be in default, for which there are legal consequences.
Director
Someone serving in a position of authority, such as the Director of the Division of Real Estate.
Disclosure
Providing information, such as on the condition of a real property or who the licensee is representing.
Double Contract
A contract in which there are two agreements, one that is turned in to the lender as if it is true and another representing the actual agreement between the patties which is withheld from the lender.
Due Diligence
The concept of reviewing all disclosures and having any tests necessary to determine if the buyer will proceed in a real estate transaction.
Evaluations and Inspections Deadline
The date by which all inspections
and review of disclosures must be completed in order to cancel the transaction and have earnest money returned or alternatively to proceed with
the transaction.
Expired License
A license will be deemed “expired” when the licensee fails to pay the fees due by the close of business on the expiration date; if the expiration date falls on a Saturday, Sunday or holiday, the effective date of expiration shall be the next business day.
Express Warranties
Guarantees to which the parties in a real estate
transaction have agreed, typically as to the condition of the property and the title.
False Devices
Instruments used to deceive one or more parties in a real estate transaction.
Fee Simple Title
The highest means of ownership in real property.
Finder’s Fee
Money paid to someone in exchange for their referral of a client or customer.
Foreclosure Rescue
A program that attempts to avert a foreclosure. While some programs are effective and truly provide a valuable service, some scammers have used such programs as a means to defraud the consumer.
Homestead Exemption
An amount exempted in legal claims against an
owner’s equity in real estate.
Improper Practices
Actions that are not appropriate and violate laws or
rules.
Improvements
Any addition to land, such as any structure
Inactivation
The placing of a license on an inactive status, either
voluntarily or involuntarily.
Inactive License
One who (a) has paid all applicable fees and (b) is not affiliated with a principal brokerage.
Fiduciary Duties
The duties required by law to represent the best interest of a client above all other interests, including that of the licensee.
Guaranteed Sales Program
A program in which a real estate licensee or brokerage guarantees the sale of a real property, usually within a specific amount of time.
IC Agreement
Independent Contractor Agreement, such as between a reaI estate licensee and their broker, which outlines the responsibilities and obligations of each party; however, such an agreement allows the
lndependent Contractor to determine their own hours and manner in vvhich they will achieve the goal for which the agreement is being signed, such as to list, sell, and close real estate.
Joint Tenancy
Ownership of real estate between two or more parties in which all parties have 100% interest, so when one party dies, the remaining party or parties still own 100%, known as rights of survivorship.
Lead-based Paint Addendum
An instrument which makes a buyer’s offer
subject to their approval of a lead-based paint risk assessment of a property.
Lead-based Paint Disclosure
Documentation in which all parties to a real
estate transaction disclose their knowledge of any existing lead-based paint and the dangers associated with it.
Liquidated Damages
A pre-agreed financial settlement in the event of
default, sometimes in the amount of the earnest money.
Loan Modification Assistance
Assistance by a mortgage licensee to
restructure a loan in behalf of a borrower. This type of assistance may not be done without a mortgage license.
Mediation
Used as an alternative to a lawsuit, the parties attempt to discuss the challenges that may have arisen in a real estate transaction and reach an
agreement or compromise.
Member Organizations
A group of people who belong to some
organized association, such as the Board of Realtors and the Utah Association of Realtors, in which people typically pay fees to be a member
and receive benefits, such as lobbying efforts in behalf of its members,training, or other support.
Misrepresentation
Poorly fulfilling agency responsibilities or misleading
the consumer with false information or data that has not been verified by the licensee.
Net Listing
A listing where the amount of the real estate commissions is the difference between the selling price of the property and a minimum price set by the seller. NOTE: Net listings are illegal in Utah.
Non-resident Licensee
A person who holds a Utah real estate principal
broker, associate broker, or sales agent license whose primary residence is in a jurisdiction other than Utah.
Notice of Default
A legal notice when a borrower is behind in their
mortgage payments to declare the impending sale of the property.
Offer Reference Date
The date on which an offer is written by the buyer on a REPC.
Plea in Abeyance
A legal action in which a citizen agrees to do something in exchange for reducing or eliminating criminal charges.
Pre-licensing Education
Education required in order for a person to
license as a real estate sales agent or broker.
Primary Contract
A real estate offer that was first accepted by the seller.
Principal Brokerage
The main real estate or property management office
of a principal broker.
Prohibited Conduct
Behavior specifically violating la\vs, rules, or
customary procedures outlined in statutes and Administrative Rules or in a broker’s IC Agreement with a licensee.
Property Management
The business of providing services relating to the
rental or leasing of real property, including advertising, procuring prospective tenants or lessees, negotiating lease or rental terms, executing lease or rental agreements, supervising repairs and maintenance, collecting and disbursing rents.
Pro-rations
Dividing the charges associated with a real estate transaction to access proportionate amount to each party based on their proportionate benefit. For example, if a house closes on June 30th, half the year’s taxes should be the responsibility of the seller and the other half should be the responsibility of the buyer.
Real Estate Commission
Five Governor-appointed people, four of whom
have been licensed for five or more years and one who does not have a real estate license, who meet at least monthly and review statutes, enact Administrative Rules and determine sanctions for licensees who have violated laws or rules.
Reciprocity
Accepting the education of a licensee from another state or having the education completed by a Utah real estate licensee accepted by another state.
Regular Salaried Employees
For purposes of this Chapter, “regular
salaried employee” shall mean an individual employed other than on a contract basis who has withholding taxes taken out by the employer.
Reinstatement
To restore to active or inactive status a license which has expired or been suspended.
Reissuance
The process by which a licensee may obtain a license following revocation.
Renewal
To extend an active or inactive license for an additional licensing period.
Safe Act
A law enacted in 2008 which requires all individuals involved in loaning money for real estate to be licensed.
Sales Agent or Real Estate Sales Agent
Any person engaged as an independent contractor or employed as provided in Section 61-2-25 by or on
behalf of a licensed principal real estate broker to provide for valuable consideration any of the acts set out in Subsection 12.
Secondary Contract
A real estate offer which was accepted subject to the removal of a primary contract.
Settlement
When Buyer and Seller have signed all documents and any monies required have been paid to the other party or the title company.
Special Assessments
Charges for items that will benefit a property owner
such as street lighting in a residential neighborhood or a new roof in a condominium project.
State-Approved Forms
Legal real estate forms which have been approved
by the Utah Real Estate Commission for use by real estate licensees.
State Construction Registry (SCR)
The legally-required process by which
construction projects are announced and those involved in the construction identify their fees.
State Licensing Exam
The exam required in order for a person lo receive
their real estate or broker’s license. Sales license candidates must achieve 70% or higher, while broker license candidates must score a 75%, or higher.
Statute of Frauds
A law that requires that all real estate transactions be in writing in order to be enforceable by the courts.
Stipulation
An agreement between a licensee who has been accused of’ a wrongdoing and the Utah Division of Real Estate along with the Utah Real
Estate Commission as to the sanctions for that licensee, such as more training, payment of a fine, etc.
Substantial Completion
The time at which a property has been constructed
to a point where a Certificate of Occupancy can be issued. There may still be some items that need completing, but if the property is ready for
occupancy and only minor work is still needed, the property is considered to be substantially complete.
Supplementary Clauses
Legal phrasing to assist a real estate licensee in
drafting an addendum.
Survey
A physical assessment of the boundaries of the property.
Time is of the Essence
In real estate transactions, any due dates are
understood to be those specifically set forth in the documentation, unless extended by the parties in writing, and must take place by 5 pm Mountain
Time on those dates.
Timeshare
An interest in real estate in which an individual has access to real property for limited periods of time.
Trust Account
The account in which trust funds are held in behalf of a client or customer.
Trustee
One who is entrusted to administer a property for someone else’s benefit.
Undivided fractionalized long-term estate
An ownership interest in real
property by two or more persons that is a:
(i) tenancy in common; or
(ii) any other legal form of undivided estate in real property including:
(A) a fee estate;
(B) a life estate; or-
(C) other long-term estate.
An “undivided fractionalized long-term estate” does not include a joint tenancy.
Utah Division of Real Estate
A division within the Department of Commerce charged with the responsibility of licensing and regulating real estate, mortgage and appraisal licensees.
Utah Real Estate Licensing Law
The statute that governs the licensing and behavior of real estate licensees.
Alluvion
increase of soil deposited on a shore or bank of a river through accretion.
Riparian
rights in land when land borders a stream or river adjacent to the water.
Acre foot
acre of land covered by 12 inches of water 43,560 cubic feet.
Loan Fraud
any scheme used to deceive the lender.
Double Commissions
when a client may be obligated to pay two commissions.
Mortgagor
borrower when using mortgage documents
Mortgagee
lender when using mortgage documents.
Trustee
third party when using a trust feed and note
Beneficiary
lender when using a trust deed and note
Allodial System
the system of real property ownership that exists in the United States.
Tenancy in Common
A way for two or more people to have equal ownership interests in a property. Each owner has the right to leave his or her share of the property to any beneficiary upon the owner’s death. Each party (owner) in a tenancy-in-common agreement has the right to use the property even if the physical size of the stake is different.
Habbendum Clause
A section in a real estate contract that transfers ownership of a property with no restrictions. The new owner has absolute ownership of the property and has the right to sell it, bequeath it to an heir, and so on. Because the clause begins with the phrase, “To have and to hold,” the habendum clause is sometimes called the “to have and to hold clause.”
