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. Agency disclosure

2. Employ
The lender in a mortgage loan - who receives a mortgage from the borrower (mortgagor).
License law term that describes a type of relationship between a broker and his or her licensees
A freehold estate created for the duration of the life or lives of certain named persons; a non-inheritable estate
A commission not based on a percentage of the selling price.

3. Police power
One that requires the mortgagor to pay interest only during the mortgage term - with the principal due at the end of the term.
The power of government to regulate the use of real property for the benefit of the public
A right of title to land
A form of co-ownership lmited to husband and wife; does not include the right of survivorship

4. Complete performance
Execution of a contract by vrtue of all parties having fully performed all terms
An act or event that must exist or occur before a duty of immediate performance of a promise arises. (relative to contracts)
Voluntary expression by the person receiving the offer to be bound by the exact terms of the offer; must be unequivocal and unconditional
A policy that insures a mortgagee against defects in a title pledged by a morgagor to secure payment of a mortgage loan.

5. Certificate of title opinion

6. Implied agency
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.
Transfer of legal rights and obligations by one party to another
A promise in a deed that the grantor will guarantee and defend the title against lawful claimants.
Agency that exists as a result of actions of the parties

7. Site condominium
One in which the interest rate changes according to changes in a predetermined index.
Mandates that the seller complete a disclosure form regarding the condition of the property
Condominium unit composed of only vacant land with surface improvements or with air space within which a building is to be constructed.
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.

8. Land use controls
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
Governmental restrictions on land use
A leasehold estate of definite duration
An organized method of sharing or pooling listings by member brokers. (electronic)

9. Deed
A federal law protecting the rights of individuals with physical or mental impairments
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 written instrument transferring an interest in real property when delivered to the grantee.
One that requires the mortgagor to pay interest only during the mortgage term - with the principal due at the end of the term.

10. Latent defect
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
Time - title - interest - and possession; concurrent ownerships require at least one unity between co-owners.
A hidden structural defect that would not be discovered by an ordinary inspection
A property owner employs a real estate firm to market a property for a prescribed period of time at a prescribed price and terms

11. Waste
A three-day right of rescission for certain loan transactions
Failing to do preventative maintenance or corrective maintenance.
A future interest in a life estate
Land and everything permanently attached to land; sometimes used interchangeably with the terms real property and realty

12. Transaction coordinator
A licensee involved in a real estate transacton without having a relationship with the buyer or the seller
The outlay of money expecting income or profit or the acquisition of property expecting income or profit
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 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.

13. Revenue stamps
Investigates alleged discrimination and secures the equal protection of civil rights.
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
A fee paid by a realtor to a brokerage out of the area for a buyer listing
A husband's interest in the real property of his wife

14. Investment
A search of the public record to determne the quality of a title to real property
(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 outlay of money expecting income or profit or the acquisition of property expecting income or profit
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

15. Foreclosure
E.g. very accurate desc or property)
The legal procedure of enforcing payment of a debt secured by a mortgage or any other lien.
.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.
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.

16. Mortgage broker
Finds someone to lend the $
The legal procedure of enforcing payment of a debt secured by a mortgage or any other lien.
A deed denoting an unlimited guarantee of title
A deposit a buyer makes at the time of submitting an offer - to demonstrate the true inten to purchase; also called binder - good faith deposit - escrow deposit.

17. Pur autre vie
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
A property map - recorded on the public record in plat books
The violations and fines or penalties - which the department and the licensee have agreed upon.
A life estate based on the life of another

18. Handicap

19. Arrears
Any property acquuired by one spouse during marriage by gift or inheritance or purchased with the separate funds of a husband or wife.
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 mental or physical disability that impairs any of a person's life functions.
Delinquency in maeeting an obligation; or - paid at the end of a period (e. g. - at the end of the month) for the previous period; payments in arrears include interest for using the money during the previous period.

20. Devisee
One in which uniform installment payments include payment of both principle and interest.
An accurate legal description of land
The recipient of a gift of real property by will
Provides that in transactons between private parties or unregulated lenders the maximum allowable interst rate is 11 percent

21. Duty of disclosure
A nickname for the Government National Mortgage Association (GNCMA) - a U. /S. government agency that purchaes FHA and VA mortgages.
When the loan payment amount is not sufficient to cover interest due - the shortfall added back into principal - causing principal to grow larger after payment is made
A responsibility for revealing all information that affects the agency agreement
Title insurance that protects contract buyer against defects in contract seller's title.

22. Baselines
A mortgage loan in which payments are insured by the Federal Housing Administration
An east-west line in the rectangular method of property description
The legal procedure of enforcing payment of a debt secured by a mortgage or any other lien.
An agreement that has been fully performed.

23. Title examination
Continuing to occupy property after lawful authorizatio has expired; a form of leasehold estate
Expenses seller owes on the day of closing but for which the buyer will take responsibility (such as property taxes)
A search of the public record to determne the quality of a title to real property
Must be in writing - must name a grantor - must name a grantee - property description - words of conveyance (aka granting clause or habendum clause - "...conveys and warrants...") - signed by grantor(s) - acknowledgment - stating to public officer th

24. Multiple listing service (MLS)
Allows lender to sell mortgage at any time and obtain money invested rather than wait for completion of loan term.
The transfer of a title by deed requires the grantor to deliver and the grantee to accept a given deed.
An organized method of sharing or pooling listings by member brokers. (electronic)
The portion of a deed that contains the grantor's and witnesses' signatures and the acknowledgment (notary).

25. Open mortgage
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
One that does not impose a prepayment penalty.
A deposit a buyer makes at the time of submitting an offer - to demonstrate the true inten to purchase; also called binder - good faith deposit - escrow deposit.
One insuring a lessee against defects in the lessor's title.

26. Time is of the essence
The form the seller completes to reveal any defects in the property (delivered within 72 hours of presentation of purchase agreement or 120 hours over a weekend). Good idea to leave a copy in the house with seller agent business card.
An exaggeration of a property's benefits.
A phrase inserted into a contract declaring that each deadline in a contract must be met as it occurs
The seller's broker makes a false statement to the buyer about the property - and the broker does not know whether the statement is true or false

27. Junior mortgage
E.g. Put on market - sell - done)
A new agreement by contracting parties that is satisfied by full performance there by terminating the prior contract as well
one that is subordinate to a subsequent mortgage (e. g. - a second mortgage)
A major source of funds for financing residential real estate.

28. Stipulation
Acronym denoting that a mortgage payment includes principal - interest - taxes - and insurance.
(a) A false statement or omission of a material fact. (b) In real estate - making an unintentionally false statement to induce someone to contract
A wife's interest in her husband's real property
The violations and fines or penalties - which the department and the licensee have agreed upon.

29. Abstract of title
The third party in a real estate transaction
When the parties are to exchange performances at the same time.
Mandates that the seller complete a disclosure form regarding the condition of the property
A history of title and the current status of a title based on a atitle examination

30. Construction mortgage
A temporary mortgage used to borrow money to contruct an improvement on land
An act or event that must exist or occur before a duty of immediate performance of a promise arises. (relative to contracts)
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.
The largest and most prominent trade organization of real estate licensees.

31. Land contract
A contract of sale and a financing instrument 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.
Permanent financing arranged to replace a shor-term construction loan.
A concept allowing that oral explanations can support the wrtten words of contract but cannot contradict them.
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. Credit
E g. if someone has used property for 15 years - judge will award title if actual - visible - hostile - open - continuous use can be proven)
Seller
A husband's interest in the real property of his wife
In a closing statement - money to be recieved or credit given for money or an obligation given.

33. Supply and demand
The principle statiing that the greater the supply of any commodity in comparison to demand - the lower the value; conversely - the smaller the supply and the greater the demand - the higher the value.
The lender requires one-twelfth of the estimated cost of the annual property taxes and hazards insurance on the mortgaged property in addition to paying monthly priincipal and interest
For profit - to induce or attempt to induce any person to sell or rent any dwelling by representations regarding the entry or prospective entry into the neighborhood of a person or persons of a particular race - color - religion - sex or national ori
A registered trademark of the National Associaton of REALTORS*; its use is limited to members only.

34. Merger
A federal law that prohibits all discrimination on the basis of race.
When a subsequent contract covering the same subject matter is drafted (with changes)
A written instrument used to pledge a title to real property to secure payment of a promissory note.
Property description that may refer to a map and lot number that has been recorded or ato a prevous deed conveying the saome property

35. VA-guaranteed loan
A promise in a deed that the grantor will guarantee and defend the title against lawful claimants.
A mortgage loan in which the loan payment is guaranteed to the lender by the Department of Veterans Affairs.
An agent working for an unnamed third party buyer (usually a celebrity)
The instrument that legally establishes a condominium; also called condominium declaration

36. Formal assumption
Permission to assume the mortgage at an interest rate prevailing at the time of assumption
The vendor cannot do anything to jeopardize the interest of the vendee.
An agreement that has been fully performed.
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.

37. impound account
(a) Money paid for the use of money. (b) An ownership or right.
An individual's being led to believe by a broker/salesperson's actions and representations that the broker/salesperson is representing (is an agent for) the individual
Another term for escrow account
Nonfreehold estate; of limited duration - providing the right of possession and control but not title.

38. Estate for years
A leasehold estate of definite duration
Assures the absence of hazardous materials or problems relating to regulations of the EPA.
The rights of an owner of a freehold estate to possession - enjoyment - control - and disposition of real property.
Court ordered awards for extremely bad behavior by a party; intended to punish and indicate that the behavior will not be tolerated

39. Commission Paid to Sales Associates

40. Contract
A right of title to land
An agreement between competent parties upon legal consideration (e. g. money - property - promise - etc. ) to do - or abstain from doing - some legal act.
Describes a buyer who is ready to buy - willing to buy - and financially able to pay the asking price.
Founded on natural duty and affection. Has no pecuniary value.

41. Realty
A search of the public record to determne the quality of a title to real property
Land and everything permanently attached to land
One who holds title to property for the benefit of another called a beneficiary
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.

42. Tenants by the entirety
A form of co-ownership limited to husband and wife - with the right of survivorship
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
A life estate based on the life of another
The amount of money (usually the loan amount) on which interest is either paid or recieved.

43. Concurrent ownership
Legal purpose.
Simultaneous ownership of real property by two or more people
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 borrower is granted the right to pay the debt plus accrued interst and costs in full after the foreclosure sale - and thereby recover the property

44. Purchase Money Mortgage
Anything of value - as recognized by law - offered as an inducement to contract.
A mortgage given by the seller to the buyer to cover all or part of the sale price. Seller financing.
Consummation of a real estate contract; also called closing.
One that is free from reasonable doubt and that a court would require a purchaser to accept

45. Mortgage
The distribution of property to legally qualified heirs of one who has died intestate
A written instrument used to pledge a title to real property to secure payment of a promissory note.
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
The actual effective rate of interest charged on a loan expressed on a yearly basis; not the same as simple interest rate

46. Seller agency

47. Declaration
A wife's interest in her husband's real property
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
An accounting of the funds received and disbursed in a real estate transaction.
Personal property growing in the soil - requiring planting and cultivation; annual crops.

48. Leasehold estate
Nonfreehold estate; of limited duration - providing the right of possession and control but not title.
Permanence of land--makes it an attractive long term investment
A fee paid by a realtor to a brokerage out of the area for a buyer listing
A deed denoting an unlimited guarantee of title

49. Statute of Frauds
Details rights of condominium purchasers in Michigan
A law in effect in all states requiring certain contracts to be in writing to be valid.
Land and everything permanently attached to land; sometimes used interchangeably with the terms real property and realty
A form of ownershp iin which stockholders in a corporation occupy property owned by the corporation under a lease.

50. Balloon mortgage
Finds someone to lend the $
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 organized method of sharing or pooling listings by member brokers. (electronic)
A policy insuring an owner of real property against financial loss resulting from a title defect.