VA Real Estate Licensing Exam - National Portion Flashcards

VA Real Estate Licensing Exam - National Portion Flashcards Which of the following is most often included in a mortgage?1. Seisin2. Further Assurances3. Quiet Enjoyment4. Pay Taxes

• Pay taxes

Annual DepreciationCost x Annual Depreciation Tax Rate (Property Tax Calculations)Property Taxes-----------------Assessed Value Fannie Mae (FNMA)Government sponsored private corporation that generates funds for primary lenders by buying and selling FHA, VA and Conventional Loans.Statutory EstateAn estate created by (state) law (the enactment of

legislation).1. Dower and Curtesy: Only recognized by

some states to determine ownership between a husband

and wife.2. Community Property: Only used by some states

(mostly int he midwest). States that spouses have equal rights to property acquired by the efforts of either spouse during marriage.3. Homestead Fee Estates (freehold estate)Highest and most unrestricted ownership interest in land includes fee simple estate (exists indefinitely; transferred without restrictions), and the qualified fee/defeasible estate (exists so long as a condition or event does or does not happen; transfers with conditions) Assessed Value (Property Tax Calculations) Property Tax---------------Tax rate In what order are liens paid?1. Law (tax lien)2. Date it was recorded ("first in time, first in line")3. By the date it attached to the property (collateral).Commission AmountSales Price x Commission Rate Estate from Year to Year (Periodic)Does automatically renew. Notice IS required to vacate.Month to month leasing is an example of this.Concurrent OwnershipMethod of real property ownership by two or more persons at the same time.1. Joint Tenancy2. Tenancy in Common3.Tenancy by the entireties Cost ApproachReplacement cost - depriciation + land value = Total Property Valueusually sets upper limits of value Easements AppurtenantLimited right of one landowner to use the adjoining land of another for a specific purpose. Generally this type of easement runs with the land (it survives the death of the owner).Annual Taxes (Property Tax Calculations) Tax Rate x Assessed Value Lot, Block and Subdivision (Recorded Plat) Well suited for subdivision developments. Includes maps of lots located by the metes and bounds or government survey method.These are originally located by either metes and bounds or by government survey.

Example of an Easement AppurtenantFarmer Brown wants to sell back pasture of land that has no access to a public road. Farmer Jack wants to buy the property with an easement to a nearby county road across property that Farmer Brown will retain. Back pasture becomes the dominant estate while Farmer Brown's pasture becomes the servient estate. The easement appurtenant remains in force and is unaffected when either parcel is sold, given away, or willed to heirs.SeisinThe possession and ownership of a freehold estate.Primary difference between Easements Appurtenant and Easements in Gross Easements in Gross do not transfer the burden with the land and the benefit cannot be transferred but he holder of the easement.Truth in Lending Act (TILA)Federal law with the primary purpose to promote the meaningful disclosure of consumer credit and lease terms in order to facilitate choice Does a lien transfer with a house through sale? Yes, liens go with the house. This is why title insurance is such a good idea.Special Assessment LienA specific, statutory and usually involuntary lien filed against properties that will benefit from a proposed public improvement (e.g. Row of townhouses all need new roofs - cost split among all houses equally) ImplicationAn easement may arise by implication from the acts for conduct of two parties.Government of CondominiumsUnit owner's association with enforcement authority over bylaws, restrictive covenant's, rules and regulations.Termination of a Joint TenancyA joint tenancy may terminate by mutual consent of the parties, or by sale. A joint tenant can sell their share. The new owner does not become a joint tenant but a tenant in common with fewer rights than a joint tenant (can only occupy their share while joint tenants can occupy any/all shares equally).EasementsLimited right to use the land of another, which may be voluntarily or involuntarily conveyed.Easements run with land - they only go away if both parties agree Name the ways an easement can be created. 1. Express Grant2. Express Reservation3. Necessity4.Implication5. Prescription6. Agreement7. Condemnation Mortgage1. Between 2 Parties2. Borrower retains title while lender takes a lien on the propertyA specific loan secured by a voluntary lien on real property, where a property owner enters into a contract to borrow money and voluntarily agrees to extinguish his rights to his real property in favor of the lender if he fails to pay the debt according to the terms of the loan agreement.LeasesA tenant (renter, lessee) has the right to use and possess real property for limited time.

Point Dollar AmountLoan Amount x Number of Points Total Transfer Tax (Transfer Tax)(sales price x state tax) + (sales price x county tax) Joint TenancyTitle held by multiple persons as if they were one person.

Principle aspect: when one joint tenant dies, the joint

tenant's interest passes on to the remaining tenants by right of survivorship.EncumbrancesAn interest in land held or asserted by someone other than the landowner, which may diminish it's value.Price per Square FootSale Price------------# of square feet Right of Survivorship (Joint Tenancy)Joint tenants cannot pass on their interest in property by a will. If one joint tenant dies their interest splits equally and passes on to the remaining joint tenants.Equity (aka Net Proceeds)Down Payment + (original loan amount - current loan amount) + appreciation Tenancy by the EntiretyPlaces title to property in the marital unit. As such this type of tenancy can only exist between a husband and wife.Recognized in less than one third of the US. This type of ownership is often used to escape probate. Remains so long as they are still husband and wife. Survivor gets ALL.Remainder Estate (future estate)Estate that automatically arises after an existing estate terminates. (remainderman)Remainder CANNOT be grantor Attachment LienJudicial action causing a defendant's real and personal property to be seized by a court and held as collateral pending a lawsuit. Real property is "attached" by recording a copy of the writ of attachment in the public record, thereby creating a lien against the property.Tax LienGeneral (lien attaches to all real and personal property of debtor), statutory and involuntary lien imposed for non-payment of federal estate taxes, federal income taxes, or payroll taxes.Creation of Joint TenancyJoint Tenancy must have four elements, called UNITIES,

that occur simultaneously: Title, Time, Interest and

Possession.VA Guaranteed Home Loan (VA Loan)1. Loan guaranteed by the department of veteran affairs for eligible veterans that purchase, build or refinance a house2. Guaranteed by RARELY originates3. The LENDER (NOT the VA) determines max loan amount and interest rates Freddie Mac (FHLMC)Organized to borrow money from pension and trust funds to purchase mortgages and pool them together and to sell bonds on the open market with mortgages as security.CostAnnual Depreciation-----------------------Annual Depreciation Rate

Annual Depreciation RateAnnual Depreciation-----------------------Cost Liens (Type of encumbrances)Guarantees payment of a debt using the property as collateral, which will be sold if the debt is not paid.Liens always arise from a debt whether agreed upon or not Reversion Estate (future estate)Remaining estate that reverts back to the grantor (seller).Similar to e remainder estate but the recipient IS the grantor.A reversion estate is created by default if no remainderman is named.How can a trust be established?1. Will2. Trust Agreement3. Deed in Trust Judgement LienGeneral, equitable, involuntary lien that attaches to a debtors real and personal property.AgreementCreated by written consent.Primary Mortgage Market1. Primer lenders or originators who make mortgage loans

(supply cash) directly to borrowers2. Activities: Loan

origination, loan servicing, conventional loan --> loan originated by PM without government insurance (FHA) or guarantees authorized by VA Dept. of Veteran Affairs (greater risk to lenders than government back loans)--Down payment (20% typical)--Primary Mortgage

Insurance (PMI): typical on loans (LTV) of over 80%

Property Tax LienSpecific (attaches to specific piece of land), statutory (arising from legislation), involuntary (created by operation of law) liens filed against real property.Loan AmountProperty Value x LTV Market Data ApproachComparables Freehold EstateEstate (ownership interest) in land in which one has both possession and (indefinite) ownership rights in real property.Pur Autre VieFrench phrase meaning "for another's life".Deed of Trust1. Between 3 Parties2. Neutral 3rd party (trustee) holds title until loan is repaid in full Vendor's LienSpecific, equitable, involuntary lien filed by a seller (vendor), against the property sold, in the amount of any unpaid purchase price. Anyone who has done work on a property can put a lien on it.Metes and BoundsIdentifies the outer edge of a parcel by establishing a well marked starting point, called a point of beginning (POB).Legal description must start and finish at the POBGood for measuring irregularly shaped parcels because it can navigate in any direction from the POB.Express Grant (creation of easement)Must be conveyed in writing, usually through a deed, with a description of the easement and the subject property that is signed, acknowledged and recorded.Discount Points8 points reduce a loan by 1%