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MI Michigan Real Estate Test

Instructions:

Answer 50 questions in 15 minutes.
If you are not ready to take this test, you can study here.
Match each statement with the correct term.
Don't refresh. All questions and answers are randomly picked and ordered every time you load a test.

This is a study tool. The 3 wrong answers for each question are randomly chosen from answers to other questions. So, you might find at times the answers obvious, but you will see it re-enforces your understanding as you take the test each time.

1. Tester
One in which the interest rate changes according to changes in a predetermined index.
A person (or persons) employed by a fair housing organization to pose as a buyer or seller or renter of real estate to determine if the licensee or landlord is acting in compliance with the law.
A form of ownership of real property - recognized in all states - consisting of individual ownership of some aspects and co-ownership in other aspects of that property.
A contract whereby a property owner employs a real estate broker to market the property described in the contract. (contract to make a fee)

2. Mortgagor
The borrower in a mortgage loan who executes and delivers a mortgage to the lender.
One who takes over management of a property until the foreclosure process is complete
A person - such as an agent - placed in a position of trusted in relation to the person for whose benefit the relationship is created; essentially the same as a trustee
One crated by deduction from the conduct of the parties rather than from the direct words of the parties; opposite of an express contract.

3. Trustor
1. offer - 2. acceptance - 3. consideration - 4. legal capacity of the parties - 5. reality of consent - 6. legality of object - 7. possibility to complete
A contract whereby a property owner employs a real estate broker to market the property described in the contract. (contract to make a fee)
A form of ownershp iin which stockholders in a corporation occupy property owned by the corporation under a lease.
One who conveys title to trustee

4. Immobility
Land cannot be relocated
One crated by deduction from the conduct of the parties rather than from the direct words of the parties; opposite of an express contract.
The right for property to descend to the heirs of the owner as set out by will or by intestate succession.
.A contract of sale and a financing insturment wherein the seller agrees to convey title when the buyer completes the purchase price installment payments; also called installment land contract - contract for deed - and conditional sales contract.

5. Metes and bounds
Multiple joint participation in a real estate investment. May be a real estate trust - corporation - or partnership.
A court instruction requiring a defaulting party to a contract to buy and sell real property to specifically perform his or her obligations under the contract
One that imposes a prepayment penalty.
E.g. very accurate desc or property)

6. Promulgate
To put in effect by public announcement; to put into operation
Lender's estimate of borrower's settlement costs - required by RESPA to be furnished to borrower at time of loan application
A tax imposed on the conveyance of title to real property by deed
A law in effect in all states requiring certain contracts to be in writing to be valid.

7. Pur autre vie
A provision iin a mortgage or deed of trust that permits the lender to declare the entire principal balance of the debt immediately due and payable if the burrower is in default
An agreement that is legally binding and enforceable.
The rights of an owner of a freehold estate to possession - enjoyment - control - and disposition of real property.
A life estate based on the life of another

8. Life tenant
A nickname for the Government National Mortgage Association (GNCMA) - a U. /S. government agency that purchaes FHA and VA mortgages.
An error of material fact by both parties
one that is subordinate to a subsequent mortgage (e. g. - a second mortgage)
One holding a life estate

9. Caveat emptor
Provides financng for rural Americans with incomes below 80 percent of the median income level in the community where they live.
The distribution of property to legally qualified heirs of one who has died intestate
Latin meaning "let the buyer bewar"; applies to "sales talk" and not to statements of material facts.
One in which the lender shares in the appreciation in property value in return for making the loan at a fixed rate lower than the rate in effect at the time the loan is made

10. Loan origination fee
Financinig charge required by the lender
Describes a buyer who is ready to buy - willing to buy - and financially able to pay the asking price.
A promise in a deed (or lese) that the grantee (or lessee) will not be distrubed in his or her use of the property because of a defect in the grantor's (or lessor's) title
Any improper or wrongful influence by one party over another whereby the will of a person is overpowered so that he or she is induced to act or prevented from acting according to free will.

11. Reality of consent
Prohibits a real estate licensee from engaging in a transaction that could be viewed as a security
To put in effect by public announcement; to put into operation
Mutual agreement between the parties to a contract; meeting of the minds; to exist and be free of duress - fraud - undue influence - and misrepresentation.
A report - based on a title examination - setting forth the examiner's opinion of the quality of a title to real property.

12. Intestate
A statutory form of deed in which the warranties are mplied from the statute rather than being spelled out in the deed.
The condition of death without leaving a valid will.
Another term for escrow account
Governmental restrictions on land use

13. Vrepaid expenses
A federal law regulating activities of lending institutions in making mortgage loans for housing.
A right of title to land
The borrower's right to redeem the title pledged or conveyed in a mortgage or deed of trust after default and prior to a foreclosure sale by paying the debt in full - accrued interest - and lender's costs.
Costs the seller pays in advance that were not fully used up (such as utility payments or property taxes due) - shown as a credit to the seller and debit to the buyer

14. Hypothecating
Agent with limited authority to act on behalf of the principal - such as created by a listing (realtors acting for realtors???)
Pledging property as security for the payment of a debt without giving up possession.
One in which the scheduled payment will not fully amortize the loan over the morgage term; therefore - to fully satisfy the debt - it requires a final payment called a balloon payment - larger than the uniform payments.
Investigates alleged discrimination and secures the equal protection of civil rights.

15. Unilateral contract
One holding a life estate
A property owner employs a real estate firm to market a property for a prescribed period of time at a prescribed price and terms
An agreement wherein there is a promise in return for a specific action - which together supply the consideration (A deal entered into by both parties after one party has fulfilled a promise. e. g. an option)
A document setting forth the value of a property as the basis for the loan guarantee by the Veterans Administration to the lender.

16. Bona fide purchaser
Those processed on uniform loan forms and according to FNMA/FHLMC guidlines
E.g. very accurate desc or property)
Contract where all terms are in writing and understood by both parties.
A buyer of property who relies on the records and is unaware of an unrecorded prior document

17. Quitclaim deed
Allows lender to sell mortgage at any time and obtain money invested rather than wait for completion of loan term.
A tax imposed on the conveyance of title to real property by deed
An accounting of all financial aspects of a mortgage loan required of lenders to borrowers in residential mortgage loans by Regulation Z of the Federal Reserve Board.
A deed of release that contains no warranty of title; used to remove a cloud on a title. A deed to relinquish or release a claim to real property.

18. Testator/testatrix
A man/woman who has died and left a valid will
A deed issued to the buyer of property that was sold under court order to pay off a debt.
Requires that an owner or any other person engaging in a real estate transaction - a real estate broker - or a real estate salesperson shall not - on the basis of a disability that is unrelated to the individua's ability to acquire - rent or maintain
A federal prohibition on discrimination in the sle - rental - or financing of housing on the basis of race - color - religion - sex - or national origin

19. Grant deed
A mental or physical disability that impairs any of a person's life functions.
Details rights of condominium purchasers in Michigan
A fee paid to an agent in advance for representation instead of commission; usually if commission exceeds retainer - a refund would be issued.
A statutory form of deed in which the warranties are mplied from the statute rather than being spelled out in the deed.

20. Marketable (merchantable) title
One that appears to meet the requirements for validity but would not be enforceable in court.
One that is free from reasonable doubt and that a court would require a purchaser to accept
The use of someone else's money to enhance your own
Pledging property as security for the payment of a debt without giving up possession.

21. Principal
Expenses seller owes on the day of closing but for which the buyer will take responsibility (such as property taxes)
(a) In the law of agency - one who appoints an agent to represent him or her. (b) Amount of money on which interest is paid or received
The substitution of the title insurance company in the place of the insured for filing a legal action.
Savings banks - mutual savings banks - commercial banks

22. Mortgage principal
The amount of money (usually the loan amount) on which interest is either paid or recieved.
One with full authority over one property of the principal - such as a property manager
A form of ownershp iin which stockholders in a corporation occupy property owned by the corporation under a lease.
The transfer of mortgage obligations to purchaser of the mortgaged property.

23. Bilateral contract
An interest sufficient to provide the right to use - possession - and control of land; establishes the degree and duration of ownership
Mandates that the seller complete a disclosure form regarding the condition of the property
An agreement based on mutual promises that provide the consideration. (A "done deal" both parties have fulfilled promises)
The principle stating that when the net profit a property generates is excessive - very strong competition will result

24. Free market
A federal law prohibiting discrimination in consumer loans
Provides ample time for buyer and seller to effect a mutually beneficial purchase and sale without undue pressure or urgency
Agency that exists as a result of actions of the parties
In a closing statement - an expense or money received against a credit

25. Estate in real property
One in which the scheduled payment will not fully amortize the loan over the morgage term; therefore - to fully satisfy the debt - it requires a final payment called a balloon payment - larger than the uniform payments.
One in which the scheduled payment will not fully amortize the loan over the morgage term; therefore - to fully satisfy the debt - it requires a final payment called a balloon payment - larger than the uniform payments.
An interest sufficient to provide the right to use - possession - and control of land; establishes the degree and duration of ownership
The business of bringing buyers and sellers together and assisting in negotiations for the terms of sale of real estate

26. Independent contractor

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27. Voidable contract
An agreement that may be voided by the parties without legal consequences.
One in which uniform installment payments include payment of both principle and interest.
Necessary elements for the creation of a contract.
OLD CAR Obedience - Loyalty - Disclosure of info - Confidentiality - Accounting - Reasonable xxx? - care - and diligence

28. Due on sales clause
A mortgage loan in which the loan payment is guaranteed to the lender by the Department of Veterans Affairs.
A statment in amortgage or deed of trust entitling the lender to declare the entire principal balance of the debt immediately due and payable if the borrower sells the property during the mortgage term. Also known as due on sale clause.
The third party in a real estate transaction
A commission not based on a percentage of the selling price.

29. Granting clause
A federal law that prohibits all discrimination on the basis of race.
One that does not impose a prepayment penalty.
The use of someone else's money to enhance your own
The statement in a deed containing words of conveyance

30. Personal property
A leasehold estate that may be terminated at the desire of either party
A statment in amortgage or deed of trust entitling the lender to declare the entire principal balance of the debt immediately due and payable if the borrower sells the property during the mortgage term. Also known as due on sale clause.
One in which uniform installment payments include payment of both principle and interest.
All property that is not land and is not permanently attached to land; everything that is movable; chattel.

31. Vrepayment penalty
Personal property that has become real property by having been permanently attached to real property
Neighborhoods that are made up of similar properties
Legal purpose.
A financial charge imposed on a borrower for paying a mortgage prior to expiration of the full mortgage term.

32. Interest
The outlay of money expecting income or profit or the acquisition of property expecting income or profit
A gift of personal property by will.
Details rights of condominium purchasers in Michigan
(a) Money paid for the use of money. (b) An ownership or right.

33. Universal agent
An inheritable estate in land providing the greatest interest of any form of title
A financial charge imposed on a borrower for paying a mortgage prior to experation of the full mortgage terms.
Occurs when a seller's broker conceals a defect in the property from the buyer or misrepresents the existence of a defect
Agent that has complete authority over any activity of principal; for example - power of attorney

34. Lien foreclosure sale
A statement in a mortgage or deed of trust giving the borrower the right to redeem the title and have the mortgage lien released at any time prior to default by paying the debt in full
An agreement between competent parties upon legal consideration (e. g. money - property - promise - etc. ) to do - or abstain from doing - some legal act.
Selling property without consent of the owner who incurred the debt - resulting in a lien - as ordered by a court or authorized by state law - and title conveyed to purchaser by judicial deed.
When the parties are to exchange performances at the same time.

35. Dower

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36. Guaranteed Loan Program
Doesn't happen anymore in this climate
One who conveys title to real property by deed
An interest in real estate such that a court will take notice and protect the owner's rights.
Should an individual borrower default on a loan - the Rural Housing Service will pay the private financier for the loan

37. Agent's Responsibility to Third Persons

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38. Subagent
Voluntary expression by the person receiving the offer to be bound by the exact terms of the offer; must be unequivocal and unconditional
Mutual agreement between the parties to a contract; meeting of the minds; to exist and be free of duress - fraud - undue influence - and misrepresentation.
A person appointedby an agent to assist in performing some or all of the tasks of the agency
Agent that has complete authority over any activity of principal; for example - power of attorney

39. Sub agent
One who holds title to property for the benefit of another called a beneficiary
A responsibility for revealing all information that affects the agency agreement
A licensee who is empowered to act for another broker in performing real estate brokerage tasks for a principal - and who owes the same duties to the principal as the agent of the principal.
A deed issued to the buyer of property that was sold under court order to pay off a debt.

40. Contract for deed
An error of material fact by both parties
Investigates alleged discrimination and secures the equal protection of civil rights.
Mortgage loan for which the monthly payments increase annually - with the increased amount applied directly to the loan's principal - thus shortening the term of the loan
A contract of sale and a financing insturment wherein the seller agrees to convey title when the buyer completes the purchase price installment payments; also called installment land contract - contract for deed - and conditional sales contract.

41. Adverse possession
A licensee involved in a real estate transacton without having a relationship with the buyer or the seller
E g. if someone has used property for 15 years - judge will award title if actual - visible - hostile - open - continuous use can be proven)
The distribution of property to legally qualified heirs of one who has died intestate
Land and everything permanently attached to land

42. Mortgage assumption

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43. Section
A buyer of property who relies on the records and is unaware of an unrecorded prior document
A form of mortgage wherein there is a third party - who is called a trustee
To pass to another (as in title)
A one-mile-square area of land described by the rectangular survey system - consisting of 640 acres

44. Ready willing and able
Lender's estimate of borrower's settlement costs - required by RESPA to be furnished to borrower at time of loan application
The lender in a mortgage loan - who receives a mortgage from the borrower (mortgagor).
Describes a buyer who is ready to buy - willing to buy - and financially able to pay the asking price.
Measure of profit

45. Alienation clause
A property owner employs a real estate firm to market a property for a prescribed period of time at a prescribed price and terms
Any act or event that - if it occurs or fails to occur - automatically creates or extinguishes a legal obligation.
A statement in a mortgage or deed of trust entitling the lender to declare the entire principal balance of the debt iimmediatley due and payable if the borrower sells the property during the mortgage term. Also known as due on-sale-clause.
A person appointedby an agent to assist in performing some or all of the tasks of the agency

46. Homogeneity
In a closing statement - an expense or money received against a credit
Neighborhoods that are made up of similar properties
A deed of release that contains no warranty of title; used to remove a cloud on a title. A deed to relinquish or release a claim to real property.
A Missouri slave sued for his freedom - claiming that his four year stay in the northern portion of the Louisiana Territory made free land by the Missouri Compromise had made him a free man. The U.S - Supreme Court decided he couldn't sue in federal

47. Familial status
An interest sufficient to provide the right to use - possession - and control of land; establishes the degree and duration of ownership
A statement in a listing contract protecting the broker's commission entitlement for a specified period of time after the contract expires; also called extender clause.
Anything of value - as recognized by law - offered as an inducement to contract.
An adult with children under 18 - a person who s pregnant - one who has legal custody of a child or who is in the process of obtaining such custody.

48. Blanket mortgage
The inability of a party to exercise his or her free will because of fear of another party.
A fee paid by a realtor to a brokerage out of the area for a buyer listing
One in which two more parcels of real property are pledged to secure payment of the note
License law term that describes a type of relationship between a broker and his or her licensees

49. Construction mortgage
The fiduciary relationship between a principal and an agent (in the form of a piece of paper that says who's acting on behalf of whom. e. g. buyer's agent - seller's agent - dual agent - etc.)
A temporary mortgage used to borrow money to contruct an improvement on land
A commission not based on a percentage of the selling price.
Those processed on uniform loan forms and according to FNMA/FHLMC guidlines

50. Brokerage
The business of bringing buyers and sellers together and assisting in negotiations for the terms of sale of real estate
Real Estate Investment Trusts (the what mutual funds are to stocks REITs are to mortgages - sort of)
A leasehold estate that may be terminated at the desire of either party
Mandates that the seller complete a disclosure form regarding the condition of the property