Fundamentals of real estate exam prep Flashcards

Fundamentals of real estate exam prep Flashcards

Legal suite:Suite that meets the current land use bylaw requirements &

that has been built w/ the property permits Professional conduct review outcomes:- Advisory note ( is for a technical breach)- Letters on reprimend (issued when there is a conducrt desvering of sanction)- Hearings (may be held when the breach are more severe)- Temporary Suspension (When the conduct is a serious nature) Written service Agreements-Outlines the roles & responsibilities of the parties-Clarifies the expectations of each party- Helps to ensure that the relationship betweeen the industry professional & client is understood Market bubbleTemporary situation in the business cycle where prices for a product becomes overflated beyond its realistic value due to excessive consumer confidence.Standard of care is measured by:- Professional standards- Professional norms & practices- Expert testimony Surface rightsRights assoctiaed with physcial ground (top layer of land)

Sections:- Each township is divided into sections- The 36 sqaure

miles of a twonship (6 miles east-west by 6 miles north-south) are further divided into 36 sections, each 1 mile apart Termination or discharge of contracts:performance, mutual agreement, frustration, operation of law, breach

Consideration:Is something of value to a party to the contract in exchange

for the services the promised in the contract- Consideration must be lawful- Consideration cannot be past consideration- Contracts without consideration, but made under seal, may still bind the parties Curtain Principle:- Means that the current title contains all the info about the title including interests registered on title

• D's of role clarity & consistency5 D's of role clarity & consistency1. Discuss2. Determine3.

Document4. Disclose5. Do

Competition Law:Conspiricies among competitors are anti competitive

agreememts intended to restrict intended to restcrict trade through unfair business practice. EX- Price fixing- Market division- Service restriction- Service refusal Payments to the lender:: The lender collects the property taxes & pays them on behalf of the property owner (borrower)- Generally seen in case of high ratio mortgages Upon completion, the practice reviewer will: - A verbal agreement of the practice review results- A written summary of the practice review findings-

Reccomendations for improvement- Ongoing support, should the broker require it, after the practice review is completed

InducementsAnything that is offered or provided by the brokerage to pursaude a person to enter into a particular real estate or mortgage transaction Undivided land:Is described by geographical references: meridian, range,township, section, quarter section & legal subdivision (LSD) Personal PropertyItems that can be removed without damaging to the the property

Tenancy in common:- 2 or more owners on the title- Each person can have

unequal shares in the property- There is no right of survivorship- Tenants in common can will their share to anyone- When the tenant in common dies, that persons share in the property goes to his or her estate & does not automatically transfer to the other person on title- A tenancy in common may be terminated by agreement between the parties to sell one tenants interest another tenant or third party

Statue of frauds:Requires certain contracts to be inwriting & signed by all

the parties bound by the contract, IN AB statue of frauds

applies to:- Contracts involving the sale or transfer of land-

Contracts to answer for the dept or duty of another- Contracts that by agreement cannot be completed within 1 year

Unilateral Mistake:That occurs when one party holds an erroneous belief &

the other party, knowing it to be erroneous, does not correct that understanding.

Duty Based Ethics:Focus on the intention behind the individuals actions as

opposed to the consequence

Mirror principal:- Means that a current title accurately reflects the current

facts about the title of the property. Therefore, all the current interests related to any particular property are reflected in the current title Quantam Merit- When the injured party has done part but not all of what was promised under the terms of the contract, the court may order the other party to pay theinured party the reasonable value for the services performed

• main objectives of professional conduct review: - To gather all relevant info in order to make an informed

decision- To treat all parties courteously, fairly & impartially- To gather info efficiently Competing interests (Common Law)When the brokerage represents 2 or more buyers who wants to write an offer on the same property

Representation relationships:In any agency relationships, the third party being

represented by another party is known as the principal- An agent is the party acrting on behalf of the principals behalf- Client = principal- Customer= third party

Title insurance:otects the property owner against financial loss as a result

of some title as well as some non title related issues.Any know defects or problems regarding the property must be disclosed to the insurer before purchasing a title insurance policy.- May cover some non title related issues(lack of building permits)- Some lenders accept title insurance in lieu of an RPR for the property- Provides gap coverage between submission & registration of docs at the titles office

The regulations:The amendments or interpretations to sections of the act &

are made by the minister of service alberta or by the lietenant govenor in council

RE Transactions involving Guardians & Trustees: When

working with a trustee or a guardian, REP's must:

• Obtain a coy of the trust agreement & read it carefully-

Verify that the agreement has been property executed- Pull title- Verify the idendity of the representative & ensure they have the legal authority to act on the individuals behalf- Retain a copy of the legal docs must be kept in the brokerage file- Guardians do not have authority to make decisions regarding the persons real property & therefore, would not be registered on title Contracts under seal:Contracts are under seal are valid & enforceable- There is no considerstion- Only one party may sign the contract- The person has to be advised that they are signing a contract under seal- EX on contracts under seal Will, & POA

Joint Tenancy:- Each person has equal share in the property as a whole &

the ownership cannot be divided- Each owner has the right of survivorship. If one dies, that person share automatically passes to the other person on title- Joint tenants cannot their share to anyone else- Most often used for married couples Professional standards are responsible for: - Trust assurance fund- Professional conduct review program- Professional conduct proceedings program Restrctive covenants:- Imposed by a developer or subdivision to restrict the land

to certain uses- EX: Resctrctions on building height,

setback requirements, fence height, siding or roofing materials- Easements, UROW, restrictive covenenats, easements all run with the land which means they stay on title when the property is sold & transfer to the new owner.Torrens System the 3 key principles- Mirror principal- Curtain Principal- Insurance Principal

Easement:Is a right to use land in common with others, Ex overland

drainage easement, utility right of way, roads, walkway, maintenance access & parking rights

Lender policy:- For the benefits of the mortgage lender- Covers title

related issues like fraud