Vocabulary: Real Estate License - Utah Law

Question 1

Recission

Answer 1

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.

Question 2

Abrogation

Answer 2

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.

Question 3

Acceptance

Answer 3

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.

Question 4

Accretion

Answer 4

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.

Question 5

Active Licensee

Answer 5

One who has (a) paid all applicable fees and (b) affiliated with a principal brokerage.

Question 6

Addendum

Answer 6

An addition to a real estate transaction written and signed on a legal form recognized in the real estate profession.

Question 7

Administrative Procedures

Answer 7

Clerical processes involved in an activity,

such as those used in handling complaints made against licensees.

Question 8

Administrative Rules

Answer 8

Rules enacted by the Utah Real Estate Commission, which have the same force and effect as statutes.

Question 9

Affirmative Duties

Answer 9

Actions which favor a particular party, such as a client, and which the licensee has an obligation to complete.

Question 10

Agency Agreement

Answer 10

The contract in which a buyer or renter agrees to

representation by a real estate licensee and the licensee agrees to provide that representation.

Question 11

Agency Disclosure

Answer 11

The disclosure required by every real estate licensee as to who they are representing in a real estate transaction.

Question 12

Associate Broker

Answer 12

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.

Question 13

Auctions

Answer 13

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.

Question 14

Avulsion

Answer 14

The violent removal of land, such as in a flood.

Question 15

Assignment

Answer 15

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.

Question 16

Branch Manager

Answer 16

A.n associated broker who manages a branch office under the supervision of the principal broker.

Question 17

Branch Office

Answer 17

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.

Question 18

Business Opportunity

Answer 18

The sale, lease, or exchange of any business which

includes an interest in real estate.

Question 19

Brokerage

Answer 19

A real estate sales brokerage or a property management company.

Question 20

CC&R’s

Answer 20

Covenants, conditions and restrictions pertaining to real estate property Ownership.

Question 21

Certification

Answer 21

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.

Question 22

Client

Answer 22

A customer who has requested representation by a real estate licensee and their broker is now a broker’s client

Question 23

Closing

Answer 23

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.

Question 24

Code of Ethics

Answer 24

Standards of practice adopted by a group, such as the National Association of Realtors.

Question 25

Commingling

Answer 25

Mixing trust funds with personal or operating funds.

Question 26

Common Areas

Answer 26

Parts of a property available for all residents to use, such as the swimming pool in a condominium complex.

Question 27

Company Registration

Answer 27

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.

Question 28

Condominium

Answer 28

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.

Question 29

Construction Access

Answer 29

The right to enter the grounds of a property during its construction.

Question 30

Construction Compliance

Answer 30

In accordance with all federal, state and local | government laws, ordinances, and regulations, and in compliance with restrictive covenants applicable to the lot.

Question 31

Construction Loan

Answer 31

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.

Question 32

Continuing Education (CE)

Answer 32

Professional education required as a condition of | renewal in accordance with Subsection 61-2-9(2)(a).

Question 33

Contract Deadlines

Answer 33

Time requirements for various actions to be completed as set forth in the REPC.

Question 34

Conveyance

Answer 34

Transfer of ownership of real property.

Question 35

Counter Offer

Answer 35

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.

Question 36

Customer

Answer 36

Someone interested in buying a product or property, but is not represented by an agent or broker.

Question 37

DBA (doing business as)

Answer 37

The authority issued by the Division of Corporations and Commercial Code to transact business under an assumed name.

Question 38

Declaration

Answer 38

In the case of a condominium project, the instrument which establishes its compliance with the Condominium Act.

Question 39

Default

Answer 39

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.

Question 40

Director

Answer 40

Someone serving in a position of authority, such as the Director of the Division of Real Estate.

Question 41

Disclosure

Answer 41

Providing information, such as on the condition of a real property or who the licensee is representing.

Question 42

Double Contract

Answer 42

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.

Question 43

Due Diligence

Answer 43

The concept of reviewing all disclosures and having any tests necessary to determine if the buyer will proceed in a real estate transaction.

Question 44

Evaluations and Inspections Deadline

Answer 44

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.

Question 45

Expired License

Answer 45

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.

Question 46

Express Warranties

Answer 46

Guarantees to which the parties in a real estate | transaction have agreed, typically as to the condition of the property and the title.

Question 47

False Devices

Answer 47

Instruments used to deceive one or more parties in a real estate transaction.

Question 48

Fee Simple Title

Answer 48

The highest means of ownership in real property.

Question 49

Finder's Fee

Answer 49

Money paid to someone in exchange for their referral of a client or customer.

Question 50

Foreclosure Rescue

Answer 50

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.

Question 51

Homestead Exemption

Answer 51

An amount exempted in legal claims against an | owner's equity in real estate.

Question 52

Improper Practices

Answer 52

Actions that are not appropriate and violate laws or | rules.

Question 53

Improvements

Answer 53

Any addition to land, such as any structure

Question 54

Inactivation

Answer 54

The placing of a license on an inactive status, either | voluntarily or involuntarily.

Question 55

Inactive License

Answer 55

One who (a) has paid all applicable fees and (b) is not affiliated with a principal brokerage.

Question 56

Fiduciary Duties

Answer 56

The duties required by law to represent the best interest of a client above all other interests, including that of the licensee.

Question 57

Guaranteed Sales Program

Answer 57

A program in which a real estate licensee or brokerage guarantees the sale of a real property, usually within a specific amount of time.

Question 58

IC Agreement

Answer 58

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.

Question 59

Joint Tenancy

Answer 59

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.

Question 60

Lead-based Paint Addendum

Answer 60

An instrument which makes a buyer's offer | subject to their approval of a lead-based paint risk assessment of a property.

Question 61

Lead-based Paint Disclosure

Answer 61

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.

Question 62

Liquidated Damages

Answer 62

A pre-agreed financial settlement in the event of | default, sometimes in the amount of the earnest money.

Question 63

Loan Modification Assistance

Answer 63

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.

Question 64

Mediation

Answer 64

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.

Question 65

Member Organizations

Answer 65

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.

Question 66

Misrepresentation

Answer 66

Poorly fulfilling agency responsibilities or misleading | the consumer with false information or data that has not been verified by the licensee.

Question 67

Net Listing

Answer 67

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.

Question 68

Non-resident Licensee

Answer 68

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.

Question 69

Notice of Default

Answer 69

A legal notice when a borrower is behind in their | mortgage payments to declare the impending sale of the property.

Question 70

Offer Reference Date

Answer 70

The date on which an offer is written by the buyer on a REPC.

Question 71

Plea in Abeyance

Answer 71

A legal action in which a citizen agrees to do something in exchange for reducing or eliminating criminal charges.

Question 72

Pre-licensing Education

Answer 72

Education required in order for a person to | license as a real estate sales agent or broker.

Question 73

Primary Contract

Answer 73

A real estate offer that was first accepted by the seller.

Question 74

Principal Brokerage

Answer 74

The main real estate or property management office | of a principal broker.

Question 75

Prohibited Conduct

Answer 75

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.

Question 76

Property Management

Answer 76

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.

Question 77

Pro-rations

Answer 77

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.

Question 78

Real Estate Commission

Answer 78

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.

Question 79

Reciprocity

Answer 79

Accepting the education of a licensee from another state or having the education completed by a Utah real estate licensee accepted by another state.

Question 80

Regular Salaried Employees

Answer 80

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.

Question 81

Reinstatement

Answer 81

To restore to active or inactive status a license which has expired or been suspended.

Question 82

Reissuance

Answer 82

The process by which a licensee may obtain a license following revocation.

Question 83

Renewal

Answer 83

To extend an active or inactive license for an additional licensing period.

Question 84

Safe Act

Answer 84

A law enacted in 2008 which requires all individuals involved in loaning money for real estate to be licensed.

Question 85

Sales Agent or Real Estate Sales Agent

Answer 85

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.

Question 86

Secondary Contract

Answer 86

A real estate offer which was accepted subject to the removal of a primary contract.

Question 87

Settlement

Answer 87

When Buyer and Seller have signed all documents and any monies required have been paid to the other party or the title company.

Question 88

Special Assessments

Answer 88

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.

Question 89

State-Approved Forms

Answer 89

Legal real estate forms which have been approved | by the Utah Real Estate Commission for use by real estate licensees.

Question 90

State Construction Registry (SCR)

Answer 90

The legally-required process by which | construction projects are announced and those involved in the construction identify their fees.

Question 91

State Licensing Exam

Answer 91

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.

Question 92

Statute of Frauds

Answer 92

A law that requires that all real estate transactions be in writing in order to be enforceable by the courts.

Question 93

Stipulation

Answer 93

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.

Question 94

Substantial Completion

Answer 94

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.

Question 95

Supplementary Clauses

Answer 95

Legal phrasing to assist a real estate licensee in | drafting an addendum.

Question 96

Survey

Answer 96

A physical assessment of the boundaries of the property.

Question 97

Time is of the Essence

Answer 97

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.

Question 98

Timeshare

Answer 98

An interest in real estate in which an individual has access to real property for limited periods of time.

Question 99

Trust Account

Answer 99

The account in which trust funds are held in behalf of a client or customer.

Question 100

Trustee

Answer 100

One who is entrusted to administer a property for someone else's benefit.

Question 101

Undivided fractionalized long-term estate

Answer 101

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.

Question 102

Utah Division of Real Estate

Answer 102

A division within the Department of Commerce charged with the responsibility of licensing and regulating real estate, mortgage and appraisal licensees.

Question 103

Utah Real Estate Licensing Law

Answer 103

The statute that governs the licensing and behavior of real estate licensees.

Question 104

Alluvion

Answer 104

increase of soil deposited on a shore or bank of a river through accretion.

Question 105

Riparian

Answer 105

rights in land when land borders a stream or river adjacent to the water.

Question 106

Acre foot

Answer 106

acre of land covered by 12 inches of water 43,560 cubic feet.

Question 107

Loan Fraud

Answer 107

any scheme used to deceive the lender.

Question 108

Double Commissions

Answer 108

when a client may be obligated to pay two commissions.

Question 109

Mortgagor

Answer 109

borrower when using mortgage documents

Question 110

Mortgagee

Answer 110

lender when using mortgage documents.

Question 111

Trustee

Answer 111

third party when using a trust feed and note

Question 112

Beneficiary

Answer 112

lender when using a trust deed and note

Question 113

Allodial System

Answer 113

the system of real property ownership that exists in the United States.

Question 114

Tenancy in Common

Answer 114

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.

Question 115

Habbendum Clause

Answer 115

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."