Test your basic knowledge |

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. Michigan State Housing Development Authority (MichDA)
Make good loans to qualified borrowers ( e. g. Rural Development loans)
The loss of funds available to lending institutions for making mortgage loans - caused by depositors' withdrawal of funds for making investments that provide greater yields.
Agent that has complete authority over any activity of principal; for example - power of attorney
To put in effect by public announcement; to put into operation

2. Agency disclosure

Warning: Invalid argument supplied for foreach() in /var/www/html/basicversity.com/show_quiz.php on line 183

3. Scarcity
An agreement that has no legal force or effect.
The third party in a real estate transaction
(a) An economic characteristic of real property. (b) In appraisal - supply of property in relation to effective demand
Permanence of land--makes it an attractive long term investment

4. Finance
The U. S. agency that insures mortgage loans to protect lending institutions.
A form of mortgage wherein there is a third party - who is called a trustee
Savings banks - mutual savings banks - commercial banks
A three-day right of rescission for certain loan transactions

5. Marketable (merchantable) title
A husband's interest in the real property of his wife
Regulates the licensing and registration of persons who make - broker - or service one- to four-family residential first mortgage loans secured by Michigan property.
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
One that is free from reasonable doubt and that a court would require a purchaser to accept

6. Agent
A mortgage loan in which payments are insured by the Federal Housing Administration
A person authorized to act on behalf of another
Occurs when a seller's broker conceals a defect in the property from the buyer or misrepresents the existence of a defect
The person transferring contractual rights to another

7. Cooling-off period
A three-day right of rescission for certain loan transactions
An error of material fact by both parties
A licensee involved in a real estate transacton without having a relationship with the buyer or the seller
Time - title - interest - and possession; concurrent ownerships require at least one unity between co-owners.

8. Bilateral contract
Ownership by only one person
Latin meaning "let the buyer bewar"; applies to "sales talk" and not to statements of material facts.
An agreement based on mutual promises that provide the consideration. (A "done deal" both parties have fulfilled promises)
The duty of agents not to disclose any information about their clients.

9. Mutual mistake
An error of material fact by both parties
The power of government to regulate the use of real property for the benefit of the public
Conveyance of title to the mortgagor in default to avoid a record of foreclosure. Also called friendly foreclosure
Organization established in 1929 by license law officials on the state commissions to assist one another in creating - administering - and enforcing license laws.

10. Offer and acceptance
1. offer - 2. acceptance - 3. consideration - 4. legal capacity of the parties - 5. reality of consent - 6. legality of object - 7. possibility to complete
The refusal of lending institutions to make loans for the purchase - construction - or repair of a dwelling because the area in which the dwelling is located is integrated or populated by minorities
Necessary elements for the creation of a contract.
one that is subordinate to a subsequent mortgage (e. g. - a second mortgage)

11. Condition
The governing board for real estate licenses in MI
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.
An error of material fact by both parties
Any act or event that - if it occurs or fails to occur - automatically creates or extinguishes a legal obligation.

12. Conventional loan
Paid to Cooperating Brokers Usually 50%/50%
Those processed on uniform loan forms and according to FNMA/FHLMC guidlines
One who receives title to real property by deed
One that has no participation by an agency of the federal government - Can be ether uninsured or insured

13. Brokerage
The business of bringing buyers and sellers together and assisting in negotiations for the terms of sale of real estate
Conveyance of title to the mortgagor in default to avoid a record of foreclosure. Also called friendly foreclosure
Make good loans to qualified borrowers ( e. g. Rural Development loans)
One-forth of a section - containing 160 acres

14. Estate from year to year
A leasehold estate that automatically renews itself for consecutive periods until terminated by notice by either party; also called estate from period to period or periodic tenancy
A federal law protecting the rights of individuals with physical or mental impairments
The document setting forth the terms and conditions of the brokerage relationship with the purchaser. (expectation to act in the client's best interest - follow legitimate instructions - advocate their price and terms; keep all pertinent info confide
A man/woman who has died and left a valid will

15. Convey
A test of soil to determine if it is sufficiently porous for installation of a septic tank.
To pass to another (as in title)
One-forth of a section - containing 160 acres
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

16. Condition subsequent
A tax imposed on the conveyance of title to real property by deed
Land and everything permanently attached to land; sometimes used interchangeably with the terms real property and realty
A form of foreclosure that does not require court action to conduct a foreclosure sale; also called foreclosure under power of sale.
Any fact - the existence or occurrence of which - by agreement of the parties - operates to discharge a duty of performance after it has become absolute. (making mortgage payments)

17. Annual percentage rate (APR)
A policy insuring an owner of real property against financial loss resulting from a title defect.
The act of reviewing loan documentation and evaluating borrower's ability and willingness to repay the loan and sufficiency of collateral value of the property.
The actual effective rate of interest charged on a loan expressed on a yearly basis; not the same as simple interest rate
An exaggeration of a property's benefits.

18. Baselines
A statutory form of deed in which the warranties are mplied from the statute rather than being spelled out in the deed.
A man/woman appointed in a will to see that the terms of the will are carried out
An east-west line in the rectangular method of property description
Doesn't happen anymore in this climate

19. Open mortgage
One that does not impose a prepayment penalty.
Personal property growing in the soil - requiring planting and cultivation; annual crops.
Latin meaning "let the buyer bewar"; applies to "sales talk" and not to statements of material facts.
Finds someone to lend the $

20. Fair Housing Act of 1968
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 three-day right of rescission for certain loan transactions
A federal prohibition of discrimination in sale - rental - financing - or appraisal of housing on the basis of race - color - religion - sex - national origin - handicap - or familial status.
The attribute of an asset's being readily convertible to cash.

21. Retainer
A fee paid to an agent in advance for representation instead of commission; usually if commission exceeds retainer - a refund would be issued.
A hidden structural defect that would not be discovered by an ordinary inspection
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.
Return of title to the holder of a future interest - such as the grantor in a life estate not in remainder

22. Vrivate mortgage insurance (PMI)
Land and everything permanently attached to land
A contract whereby aproperty owner employs a real estate broker to market the property described in the contract
A formal statement before an authorized official (e. g. notary public) by a person who executed a deed - contract - or other document - that s was (is) his or her free act.
A form of insurance coverage required in high loan-to-value ratio conventional loans to protect the lender in case the borrower defaults in loan payment.

23. Confidentiality
An agreement based on mutual promises that provide the consideration. (A "done deal" both parties have fulfilled promises)
Prohibits a real estate licensee from engaging in a transaction that could be viewed as a security
One who receives title to real property by deed
The duty of agents not to disclose any information about their clients.

24. vendor's affidavit
The instrument that legally establishes a condominium; also called condominium declaration
The statement in a deed containing words of conveyance
Document signed under oath by vendor stating that vendor has not encumbered title to real estate without full disclosure to vendee.
Master deed containing legal description of the condoinium facility - a plat of the property - plans and specifications for the building and units - a description of the common areas - and the degree of ownership in the common areas available to each

25. Freehold estate
One in which two more parcels of real property are pledged to secure payment of the note
To perfect the claim and obtain a title to the property - the claimant must satisfy the court that he or she has fulfilled the requirements of the adverse possession statute of Michigan
A right of title to land
A contract whereby a property owner employs a real estate broker to market the property described in the contract. (contract to make a fee)

26. Buyer's contract
Interest only loan (e. g. - construction loan--you are only paying interest - no principal)
A contract in which a buyer hires a broker to obtain property that he or she may purchase; the broker is the agent of the buyer - who is his or her principal
Cash sales - New financing
To perfect the claim and obtain a title to the property - the claimant must satisfy the court that he or she has fulfilled the requirements of the adverse possession statute of Michigan

27. Grantee
One who receives title to real property by deed
A form of co-ownership lmited to husband and wife; does not include the right of survivorship
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 promise in a deed that the title causes no encumbrances except those set forth in the deed.

28. Pur autre vie
A form of insurance coverage required in high loan-to-value ratio conventional loans to protect the lender in case the borrower defaults in loan payment.
Make good loans to qualified borrowers ( e. g. Rural Development loans)
E g. if someone has used property for 15 years - judge will award title if actual - visible - hostile - open - continuous use can be proven)
A life estate based on the life of another

29. Defeasible
No two parcels of land are identical
Agency that exists as a result of actions of the parties
Subject to being defeated by the occurrence of a certain event
Occurs when a seller's broker conceals a defect in the property from the buyer or misrepresents the existence of a defect

30. Truth-in-Lending Simplification and Reform Act (TILSRA)
Requirements issued by the Federal Reserve Board iin implementing the Truth-in-Lending Law - which is a part of the Federal Consumer Credit Protection Act
A licensee involved in a real estate transacton without having a relationship with the buyer or the seller
An implied agency without an agency agreement
Voluntary expression by the person receiving the offer to be bound by the exact terms of the offer; must be unequivocal and unconditional

31. Acceleration clause
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 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
Continuing to occupy property after lawful authorizatio has expired; a form of leasehold estate
A formal statement before an authorized official (e. g. notary public) by a person who executed a deed - contract - or other document - that s was (is) his or her free act.

32. Bequest
A person appointedby an agent to assist in performing some or all of the tasks of the agency
An implied agency without an agency agreement
The aggregate of rights - powers - and priveleges conveyed with ownership of real estate
A gift of personal property by will.

33. Buyer Agency Agreement

Warning: Invalid argument supplied for foreach() in /var/www/html/basicversity.com/show_quiz.php on line 183

34. Commission
A contract in which a buyer hires a broker to obtain property that he or she may purchase; the broker is the agent of the buyer - who is his or her principal
A temporary mortgage used to borrow money to contruct an improvement on land
One that appears to meet the requirements for validity but would not be enforceable in court.
Paid to Cooperating Brokers Usually 50%/50%

35. Complete performance
A wife's interest in her husband's real property
Permanent financing arranged to replace a shor-term construction loan.
Expenses seller owes on the day of closing but for which the buyer will take responsibility (such as property taxes)
Execution of a contract by vrtue of all parties having fully performed all terms

36. Junior Mortgage
Second mortgage
The recipient of a gift of real property by will
The rights of an owner of a freehold estate to possession - enjoyment - control - and disposition of real property.
Money to be paid and received as compensaton for a breach of contract.

37. Constructive condition
A condition in a contract imposed by a court. (e. g. court orders payback on agreed upon amount because of incomplete fulfillment of contract...38 acres instead of 40 sold)
The manner in which rights and liabilities of parties may be changed by application of law without the act or cooperation of the parties.
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
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.

38. Highest and best use
Use of land that will preserve the dand utility - provide the greatest income - and result in the greatest present value of the land
Pledging property as security for the payment of a debt without giving up possession.
The power of government to regulate the use of real property for the benefit of the public
A proceeding in which a court gives a mortgagor in default a specified time period in which to satisfy the debt and thereby prevent transfer to the lender of the title to the mortgaged property.

39. Universal agent
A federal law regulating activities of lending institutions in making mortgage loans for housing.
A form of deed with or without covenants of title
Agent that has complete authority over any activity of principal; for example - power of attorney
An agreement that may be voided by the parties without legal consequences.

40. Designated agency
A promise in a deed that the grantor will execute further assurances that may be reasonable or necessary to perfect the title in the grantee
The largest and most prominent trade organization of real estate licensees.
The client (buyer or seller) has an agency relationship with only those persons named in the listing contract or buyer agency contract. (Other agents within the same brokerage would not be dual agents in this instance.)
E.g. very accurate desc or property)

41. Discharge of contracts

Warning: Invalid argument supplied for foreach() in /var/www/html/basicversity.com/show_quiz.php on line 183

42. Delivery and acceptance
The transfer of a title by deed requires the grantor to deliver and the grantee to accept a given deed.
The act of reviewing loan documentation and evaluating borrower's ability and willingness to repay the loan and sufficiency of collateral value of the property.
Leaseholds; estates with a length determined by agreement or statute; establishes possession of land as oppposed to ownership in fee.
Paid to Cooperating Brokers Usually 50%/50%

43. Negligent misrepresentation

Warning: Invalid argument supplied for foreach() in /var/www/html/basicversity.com/show_quiz.php on line 183

44. Fiduciary
Lender's estimate of borrower's settlement costs - required by RESPA to be furnished to borrower at time of loan application
Execution of a contract by vrtue of all parties having fully performed all terms
A phrase inserted into a contract declaring that each deadline in a contract must be met as it occurs
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

45. Express Contract
Contract where all terms are in writing and understood by both parties.
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.
Evidence that a valid debt exists
The market in which lenders sell mortgages

46. Feudal system
A form of co-ownership limited to husband and wife - with the right of survivorship
Land was owned or controlled by the King
Tax on the conveyance of title to real property ($8.60 per 1000; $4.30 per half thousand) The $8.60 is split: $1.10 to county - $7.50 to state
Measure of profit

47. Location
An implied agency without an agency agreement
Land was owned or controlled by the King
Consummation of a real estate contract; also called closing.
An economic characteristic of land having the greatest effect on value in comparison to any other characteristic

48. REALTOR*
A registered trademark of the National Associaton of REALTORS*; its use is limited to members only.
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.
A search of the public record to determne the quality of a title to real property
In Michigan - a person appointed by a court to distrbute the property of a person dying intestate

49. Master deed
A statement in a lease or condominium articles of association that provides for a lessee or an association to have the first opportunity to purchase the property before it is offered to anyone else.
The instrument that legally establishes a condominium; also called condominium declaration
The use of someone else's money to enhance your own
A man/woman who has died and left a valid will

50. Abstract of title
A form of co-ownership limited to husband and wife - with the right of survivorship
A form of mortgage wherein there is a third party - who is called a trustee
A proceeding in which a court gives a mortgagor in default a specified time period in which to satisfy the debt and thereby prevent transfer to the lender of the title to the mortgaged property.
A history of title and the current status of a title based on a atitle examination