Glossary of Final Exam Realestate Pawlicki

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What is the benefit of having a Cul-de-sac lot? pg.352 L. 7-11
-more spacious backyard
-less car traffic
What is the definition of escheat? pg. 169 L.12-14
-provides for government
-allows to take property of deceased without any hiers
Using the government survey system , start prime meridian, and baseline- east to west. What are they called? pg.198 Fig.10.6
Principal meridian - north and south
Base Line- east and west
Four legal descriptions: which one has 2.5 acres? pg. 202 L. 16-25 / pg. 203 L. 1-6
1/2 ,1/2 = 2*2=4
640/4= acres
Metes and bounds given a degree, what is opposite? Pg. 195 Fig 10.2
west/east =90 degree
north and south = 0 degree
Everything about statue of frauds. pg. 210 L. 38-42 / pg.211 L. 1-26
-P- urchase and sale of conrtacts
-O- ption contracts
-L- ease agreements for MORE than one year
-L- isting agreements for MORE than one year.

-must be written/signed except:
1) when an oral contract has been formed and the buyer has paid part of the property or made improvements.
2) if both parties have fully performed as promised.
What are statute of limitations? pg. 211 L.27-30
(time a contract may be enforced)
-written contracts - 5 years
-Oral contracts - 4 years
-1/2 written 1/2 oral - 5 years written and 4 years oral.
Which items required to make any contract valid? pg. 211 L. 35-38
1) contractual capacity of parties (competence)
2) offer and acceptance (mutual assent)
3) Legality of Object
4) Consideration
What are elements needed to have a real property contract valid? pg.213 L. 1-3
C-contractual capacity( competent parties)
O- offer and acceptance (meeting of the minds)
L- Legality of object
I - In writing and signed (statue of frauds)
C- consideration (valuable or good)
Definition of open listing. pg.220 L.16-17
an employment contract given to any number of brokers who work simultaneously to sell the property.
What happens to a mortgage in a title theory state? pg. 248 L. 13-18
Title to a mortgage property is conveyed to the lender through a mortgage deed, if the borrower defaults, the lender may take possession of the property.
What are the elements of a net lease? pg.181 L. 35-37
a tenant pays fixed rent plus property costs such as maintenance and operating expenses(taxes insurance and utilities). Typically commercial property.
what happens to principals on a level payment fixed mortgage? pg. 262 L. 10-15
Payments during the first few years are almost entirely to pay interest and payments during the last few years are almost entirely principal repayment
What does a gem mean? pg.267 L.10-15
Growing equity mortgage (GEM): rapidly increases the equity in a property by increasing the monthly payments by a certain percentage each year and applying these increases to the principal. quicker payoff.
What does exculpatory clause in a mortgage do? pg.253 L.44-46
exculpatory clause requires that the lender waive the right to a deficiency judgment against the borrower. it relieves the borrower of personal liability to repay te loan.
What is the interest rate charge to members of the FED bank called? pg. 282 L. 14-15
The discount rate.
What is the HER and TOR for the different type of mortgages? pg.270 L. 2-5 pg. 271 BOX
HER- housing expense ratio-29 %
-monthly housing expenses/ monthly gross income
TOR - total Obligation ratio -41%
-total monthly obligations/ monthly gross income
who guarantees mortgage back securities? pg.288 L. 35
Ginnie Mae
What does hypothecation mean? pg. 249 L. 8-10
refers to the pledging of property as security for payment of a loan without surrendering possession of the property.
What are elements of an ARM? pg.266 L.8-11
Adjustable-rate mortgages:
calculated interest rate = index + margin
How does the FED reduce the supply of money? pg. 282 L. 25-35
Change/increase the reserve requirements. Reserve requirements are the amount of funds the bank must hold in reserve against deposits liabilities.
How does the binder deposit appear on a closing statement? pg. 309 L.15/16
credit to the buyer
How to compute State tax on a Deed? pd.305 L. 33-36
Stamps on deed .70 - 100$
Note,stamps on notes .35- 100$
Intangible on new mortgages .002-1$ of debt.
What does wattage mean? pg. 359 L.16-19
wattage indicates how much energy a device consumes. electric company charges customers according to kilowatt hours used. kwh-1000 watts
What does exchange value mean? pg.324 L.7-11
The ability to command other goods in exchange. market value.
given a scenario determine CBS vs. CIA & make math adjustments.
pg. 328 L.41-46
pg.329 Fig15.1 & box
Comparable property Better = Subtract
Comparable property inferior= add
What would be classified as a fixed expense to determine NOI?
pg.336 L. 35-42
ex, property taxes, hazard insurance.
Which is NOT a tax advantage to owning a home? pg.400 L.41-44 pg.401 L.4-5
1) Mortgage Interest
2) Property taxes
3) Interest on a home equity loan
4) Mortgage origination fees (points)
Definition of positive leverage.
pg. 377 L.36-37
If the benefits from borrowing exceed the costs of borrowing.
Which is NOT benefits of investing in real estate? pg. 371 L.42-45 pg. 372 L.1-23
Good rate of return
Tax advantages
Hedge against inflation
Equity buildup
Bad = illiquidity = not liquid.
Define highest and best use.
Pg. 326 L.21-29
The most profitable use to which a property may be put.
1)legally permissible (zoning)
2)physically possible (soil type, slope)
3) financially feasible (income generating vs. costs)
define Physical deterioration.
pg. 334 L. 15-19
ordinary wear and tear cause by use, lack of maintenance exposure to elements and physical damage.
When can a seller choose title and insurance Company?
pg.132 L.8-13
When the seller is paying for the owner's title insurance policy.
what methods are used to appraise a business? pg. 383 L. 9-15
liquidation analysis. Used b/c ; failure, death of a sole proprietor, dissolution of partnership, a court order, or any # of other reasons.

consider: pay-off short term obligations, the value of inventory on hand, and the liquidation value preferred stock.
What are the requirements for lead base paint disclosure? (fins false) pg.225 L.41-43 Pg. 226 L.1-4
pamphlet, disclosure must be signed.
calculate special assessment.
pg.399 L. 21-25
feet * $$ = total
total * owners share = OS
OS /2 = Special assessment.
The steps in order to protest and assess evaluation.
pg.391 L.41-46
1) Go to county property appraisers office.
2) Go before Value adjustment board
3) Go to court
What does a RAM do? pg.266 L.43-45
pg. 267 L.1-3
reverse annuity mortgage. designed to help elderly homeowners The lender pays the borrower a fixed amount each month based on the mortgagor's life expectancy and property value.
Calculate millage rate.
pg. 393 L.2-5
1,000 mills - $1.

approved budget- non property tax revenue/
total assessed value - exemptions =

Tax rate.
Scenario; determine adjusted basis of a home. pg.402 L.1-7 1st Box
original purchase price + purchase expenses and capital improvements =
adjusted basis
Variables that influence the supply of real estate. pg. 414 BOx
1)skilled labor
2)construction loans and financing
Define over improvement. pg.325 L. 19-22
when an owner invests more money in a structure than they may reasonably expect to recapture.
purpose of zoning ordinances. pg. 430 L. 23-26
local laws that implement the comprehensive plan. local gov. exercises police power by regulating and controlling the use of land and structures within designated land-use districts or zones.
How to create tenancy in common.
pg. 152 L.44-45 Pg. 153 Fig8.4
1) 2 or more people
2) undivided possession
3) interest equal or unequal percentage
4) same or different time
5) No right of survivorship heirs inherit.
define Buffer zone pg.432 L.1-5
A strip of land separating one land use from another.
Purpose of variance. pg. 433 L.3-21
allows all property owners to vary from strict compliance with all or part of a zoning code.
under 2 conditions;
1)property owner must show hardship exists.
2)ZBA must use same criteria to judge the validity of requests for variance.
difference between block buster and steering pg. 127 L.18-20
steering - channel protected home seekers away from areas that are not mixed with that class.
block bustering - use entry or rumor of entry of a protected class in a neighborhood to persuade others to sell.
Elements of RESPA pg.131 L.28-30
good faith estimate (GFE) of closing (settlement) costs, listing charges the buyer is likely to pay at closing.
What equal credit opportunities act does.
pg. 131 L.8-12
ECOA of 1974. ensures financial institutions and firms engaged in extending credit will make credit available with fairness and w/o discrimination.
landlord and tenants act, where security deposits may be kept. pg.135 L.29-34
non-interest/interest bearing accounts in Florida. or
post a security bond with the clerk of court in the county in which the rental property is located.
define spec homes. pg.8 BOX
Building "on speculation" involves purchasing one or more lots and constructing a home without securing a buyer in advance of construction.
What is true about CMAS? pg.6 L.27-28
a CMA is a marketing tool and may NOT be referred to or represented as an appraisal.
Federal regulated transaction(false)?. pg.6 L.17-20
Federally related transactions include the sale, lease, purchase, exchange, investment , refinancing, or other use of real estate as a security for a loan or investment that has a transaction value greater than 250,000.
When to give a broker relationship disclosure.
pg.50 L. 21-34
when dealing with residential real estate transactions. ONLY
What don't disclose on real estate applic. pg.15 L.31-34
traffic offense, ex) parking, speeding, inspection, or traffic signals violations.
Sales associate: what to do if license expired for 18 months. Not the 1st renewal. pg.39 L.12-13
complete 2 28 hour continuing education courses.
define Irrevocable consent to service.
pg.18 L.27-39
pg.19 L. 1
provides that lawsuits and other legal actions may be initiated against the applicant in any county of FL.
define equity. pg.370 L. 22-24
investors own money.
What course must you complete before renewing license the 1st time. pg. 21 L. 2-3
post licensing education requirement.
meaning of "exercise limited confidentiality" pg. 52 L. 5-12
prevents disclosure that seller and buyer are in agreement on price.
If a brokers license is revoked what action to sales associate license? pg. 40 L. 22-28
no disciplinary action. license involuntarily suspended.
who is exempt to licensure according to 475? pg. 24/25 L. 23-24
buy/sell cemetary lots
mobile park homes
What are duties of transaction broker? (false) pg. 51/52 fig.4-4 pg.67 / fig. 4-1 pg.55
full disclosure
When does a broker have 2 have written consent to transfer to transaction broker? pg. 58 L.21-26
transition to another relationship.
When to a present verbal offer.
pg.52 L. 1-4
timely manner
Loan to value ratio
Loan amount/ price =Ratio
IRS depreciationon insitutional property
dep. basis /39 years = annual depreciation
# of lots that go to an acerage tract
sq.feet per acre * percent land available= #
#/ minimum sq feet per lot =##
##* acre= total subdivsion lots
NOI then put into IRV formula
potential gross income (PGI) - vacancy and collection losses
+ other income= EGI

EGI- expenses oper.
Irv Formula
s SELLER .70-100
n BUYER .35 - 100
I BUYER .002- 1
MONTHLY EXPENSES / gross income
2nd months principal on mortgage
principal balance* annual interest /12= 1st months interest

monthly mortgage payment - first months interest = pay. on principal

begining principal balance - principal payment = new principal balance
sale price / monthly rental= GRM

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