Chapter 5 Flashcards

Chapter 5 Flashcards Co-ownershipCo-ownership means that a parcel is owned by two or more persons or organizations. Co-owners are called co-tenants.In Texas there are three types of co-ownership that are

recognized:Tenancy in commonJoint tenancyCommunity

property What three types of co-ownership does Texas recognize?Tenancy in commonJoint tenancyCommunity property In a co-op, how is the value of a unit identified?The number of shares purchased reflects the value of the apartment unit in relation to the property's total value.In most states a person must be how old to hold a real estate license?18 What are the three main forms of ownership? In severalty - Held by only one ownerIn co-ownership - Held by two or more peopleIn trust - Held by a third party for the benefit of someone else Texas recognizes three types of co-ownership: Tenancy in commonJoint tenancyCommunity property There are numerous laws that affect the real estate

industry, including:

Contract lawsProperty lawsAgency lawsLicense lawsFederal regulationsTax lawsZoning lawsEnvironmental laws What are the four unities needed to create a joint tenancy?Unity of timeUnity of titleUnity of interestUnity of possession tenancy in commonalso known as the estate in common, is the most common form of co-ownership when the owners are not married.

The defining characteristics are:Two or more

ownersIdentical rightsInterests individually ownedElectable ownership sharesNo survivorshipNo unity of time In most states, for a person to be licensed as a real estate agent there are a number of requirements. An individual

must:

Be a citizen of the United States or a lawfully admitted alienBe eighteen (18) years of age or olderBe a legal resident of the stateSuccessfully complete a course of studyPass a state issued examSubmit a completed license application with attached feesSubmit to fingerprintingBe approved by a licensing boardObtain broker sponsorship joint tenancytwo or more persons collectively own a property as if they were a single person. Rights and interests are indivisible and equal. Each has a shared interest in the whole property which cannot be divided up. Joint tenants may only convey their interests to outside parties as tenant-in-common interests. One cannot convey a joint tenant interest. The defining characteristics and

requirements are:Unity of ownershipEqual

ownershipTransfer of interestSurvivorship In what two ways can a bundle of rights be held? Rights in the bundle may be held by one party or separated and held by different parties.

Identify at least four ways that a business can be organized?Sole proprietorshipPartnershipJoint ventureCorporationLimited Liability companySyndicateReal estate investment trust living trustallows the trustor, during his or her lifetime, to convey title to a trustee for the benefit of a third party. The trustor charges the trustee with all necessary responsibilities for managing the property, protecting its value, and securing whatever income it may produce. The trustee may also be ordered to sell the property at a given point. The beneficiary receives all income and sales proceeds, net of the trustee's fees.Estate (Ownership) in SeveraltyIf a single party owns the fee or life estate, the ownership is an estate (ownership) in severalty. Synonyms are sole ownership, and tenancy in severalty. This type of ownership severs or separates from any form of co-ownership.When the sole owner is a husband or wife, the property is separate property. The owning spouse holds the title separately from his or her spouse.Texas Uniform Condominium Actstates that an owner of an apartment or unit holds a fee simple title to his or her unit and a share of common elements as tenants in common. The share of the common elements, however, is limited since they have no right to partition them. Read through and be familiar with chapter 81 of the Texas Property Code that pertains to the Uniform Condominium Act.community propertyThis type of ownership defines property rights of legal spouses before, during, and after their marriage, as well as after the death of either spouse. Separate property consists

of:Property owned by either spouse at the time of the

marriageProperty acquired by either spouse through inheritance or gift during the marriageProperty acquired with separate-property fundsIncome from separate propertyA spouse may gain an equitable interest in

separate property if:The value of the separate property

increases during the marriageCommunity property funds were used to discharge any debt on the separate property

Businesses can be organized as:Sole proprietorshipPartnershipJoint

ventureCorporationLimited Liability companySyndicateReal estate investment trust What does a living trust do?Allows the trustor, during his or her lifetime, to convey title to a trustee for the benefit of a third party An agent owes the principal a number of duties. These

include a duty to:

Undertake the tasks specified by the terms of the agencyDischarge his or her duties with care and due diligenceAvoid conflict of interest between the interests of the principal and his or her ownNot accept any new

obligations that are inconsistent with the duties owed to the principal.Not engage in self-dealing Land Trustallows the trustor to convey the fee estate to the trustee and to name himself or herself the beneficiary. The land

trust applies only to real property, not to personal property.The agreement, or deed in trust, grants the beneficiary the rights to possess and use the property, and to exercise control over the actions of the trustee.