Texas Real Estate Exam National Flashcards

Texas Real Estate Exam (National) Flashcards acceleration clausein the event of default the whole amount of the principal becomes due and payable economic characteristics of land (SAFE)-situs-alteration-fixity-economic scarcity exclusive right to sellthe broker is the exclusive agent and receives the commission even if the seller sells the property himself-the type of listing a broker wants trade fixtureobjects affixed to leased property that are owned by and

necessary for the tenant's trade or business-accession:

acquiring property if trade fixtures are not removed prior to the termination of the lease types of co-ownership-tenancy in common-joint tenancy-community property-partnerships Buyer Representation Agreementthe written agreement that creates theagency and contractual relationship between a broker and a buyer types of leasehold estates-estate for years-periodic tenancy-estate at will-tenancy at sufferance freehold estatethe property owner has actual ownership and possession of the land, which lasts for an unspecified period of time release clausewhen specific amounts of repayment are reached, as set forth in the contract, individual parcels of land may be released from the mortgage (they become encumbered) Environmental Impact Statement (EIS)determines the effect of a project on a community agent's duties to a principal (OLD CAR)-obedience-loyalty-disclosure-confidentiality-accounting-rea sonable care mutual rescissionboth parties agree to cancellation forms of ownership-individual ownership-co-ownership-held in trust held in trusta property is held by one party for the benefit of another Equal Credit Opportunity Act (ECOA)prohibits discrimination by lenders on the basis of:1. sex2.marital status3. race4. religion5. age6. participation in public assistance programs comminglinga broker mixes a client's money with his funds mortgagea pledge of real property as security for a promissory note-mortgagor borrows the money, mortgagee is the lender Comprehensive Environmental Response Compensation and Liability Act (CERCLA) established the Superfund to clean up hazardous waste and respond to spills-set up guidelines for liability (the owner is personally responsible for the whole cleanup cost) discount ratethe rate that a bank pays when it borrows from the Federal Reserve amortizedpaid off in portions over time

principles of value-highest and best use-substitution-conformity-increasing and decreasing returns-regression-competition-change-anticipation periodic tenancya lease with a fixed period that is automatically renewed unless the tenant or landlord acts to terminate it-month-to-month lease deed restrictions (CC&R's)sets limits on how the property may be used by the owner (covenants, conditions, & restrictions)-created by the grantor Truth in Lending Act (TILA)allows consumers to understand the true cost of borrowing money-implemented by Regulation Z-covers consumer credit for all real estate loans regardless of value, and for non-real estate loans up to $25,000-PITI not needed in an advertisement to comply with Regulation Z tenancy at sufferancewhen a lease expires and a tenant refuses to move out-tenant becomes a holdover tenant water rights-riparian rights: flowing water-littoral rights: lakes or oceans-transferred by deed or conveyance types of listingsopen listing, exclusive agency, exclusive right to sell, net listing-all must be in writing to satisfy the Statute of Frauds easementa right to use part or all of another individual's land or property for a specific purpose and length of time estate at willa lease that can be terminated by either party at will without notice cost approachvalue = land value + building replacement cost -

depreciation-example: an appraiser has been asked to

determine the market value of a home significantly older than all the other homes in the neighborhood dual agency/intermediaryonly permitted if both the buyer and seller agree in writing types of depreciation-physical deterioration-functional obsolescence-economic/external obsolescence estatean interest in real property physical characteristics of land (DUI)-durability-uniqueness-immobility special assessmenttaxes levied on property to pay for public improvements redliningthe refusal to do business in a particular geographic area-only lenders can be guilty reconciliationwhen an appraiser combines their findings from several approaches for the final report unilateral contractbinds only one party-an "if...then..." contract-i.e. option contract voluntary lienwhen a person takes actions that places a lien on his or her

own property-example: taking out a mortgage or home

improvement loan market valuethe price a willing seller will sell for, and the price a willing buyer will pay, when neither is acting under exceptional

pressure

contract for deedseller contract that does not transfer legal title

immediately-protects the seller if the buyer defaults-parties:

vendor, vendee (both must sign) "time is of the essence"a clause in a contract that allows each party to hold the other to strict performance on the date specified-found in the Addendum for Sale of Other Property by Buyer involuntary lienproperty owner doesn't take any action to initiate them-created by law-can be statutory or

equitable-statutory: federal tax liens, ad valorem tax liens,

judgement liens-equitable: arise out of common law and

include seller (vendor) or buyer (vendee) liens government loan programsFHA, VA police powerpower given to a municipality to regulate and control the character and use of property for the health, safety and

general welfare ofthe public-most common example:

zoning encroachmenta physical intrusion on someone else's property without direct permission exclusive agencythe broker is the exclusive agent and receives commission unless the seller sells the property himself novationsubstitution of a new contract for an existing one net listingall money over the amount the owner wants for the sale of the property is treated as the broker's commission discount pointone percent of the loan amount conversiona broker uses a client's money for his own purposes income approachproperty value = net operating income / capitalization rate (rate of return) statutory estatecreated by law-community property & homestead in Texas principal's duties to an agent-compensation-information-indemnification-avaliability property taxes"ad valorem" taxes (according to value)-unpaid taxes create automatic lien (highest priority) on the property equitythe money applied towards the principal amount of a loan, as opposed to the loan interest, plus any increase in the value of the property because of appreciation-buyer's equity is the amount of the down payment-seller's equity is the difference between the price and the outstanding loan balance antitrust lawsprohibit businesses from establishing groups or standards that interfere with normal business competition-enforced under the Sherman Antitrust Act-most common antitrust violations in the real estate industry include price fixing, boycotting competitors and allocating customers or markets equitable redemptionat any time up to the moment of the foreclosure the borrower has the right to step in and pay what he owes and reinstate the mortgage