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. Tester
Return of title to the holder of a future interest - such as the grantor in a life estate not in remainder
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.
Agreement of the parties; full performance; iimpossibility of performance; operation of law (judge's ruling)
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.

2. Supply and demand
The amount of the brokerage's commission that goes to the realtor
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.
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.
Any advertising that states or indicates a preference - limitation - or discrimination on the basis of race - color - religion - sex - national origin - handicap - or familial status in offering housing for sale or rent.

3. Constructive condition
A statutory form of deed in which the warranties are mplied from the statute rather than being spelled out in the deed.
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)
Written registration of an owner's title in public records to protect against subsequent claimants.
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

4. Consideration
Neighborhoods that are made up of similar properties
A form of organization that makes and services mortgage loans.
Anything of value - as recognized by law - offered as an inducement to contract.
The shortened name for the Federal National Mortgage Association (FNMA) - a privately owned corporation that purchases FHA - VA - and conventional mortgages

5. Contract
Use of land that will preserve the dand utility - provide the greatest income - and result in the greatest present value of the land
Court ordered awards for extremely bad behavior by a party; intended to punish and indicate that the behavior will not be tolerated
An agreement between competent parties upon legal consideration (e. g. money - property - promise - etc. ) to do - or abstain from doing - some legal act.
Coalition of private - nonprofit fair housing groups that has joined with federal and state government fair housing enforcement agencies to substantially improve fair housing enforcement activities.

6. Michigan Due on Sale Clause Act
Doesn't happen anymore in this climate
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.
Continuing to occupy property after lawful authorizatio has expired; a form of leasehold estate
Provides that if the lender amends the loan contract and blends the rate for the buyers assuming the loan - the seller still retains liability on the note and the mortgage. It applies to Michigan state-chartered lenders only

7. Allodial system
Execution of a contract by vrtue of all parties having fully performed all terms
Individual - private ownership of land
No: misrepresentation of fact; negligent misrepresentation; innocent misrepresentaton. MI law says seller's broker is not liable for statments made to buyer/customer regarding condition of property.
Voluntary expression by the person receiving the offer to be bound by the exact terms of the offer; must be unequivocal and unconditional

8. Location
An economic characteristic of land having the greatest effect on value in comparison to any other characteristic
One in which a leasehold (nonfreehold) estate is pledged to secure payment of the note.
The instrument that legally establishes a condominium; also called condominium declaration
One who holds title to property for the benefit of another called a beneficiary

9. Convey
An estimate of value of a particular property - at a particular time for a specified purpose.
E g. if someone has used property for 15 years - judge will award title if actual - visible - hostile - open - continuous use can be proven)
To pass to another (as in title)
The recipient of a gift of real property by will

10. Executory contract
An agreement based on mutual promises that provide the consideration. (A "done deal" both parties have fulfilled promises)
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
An agreement that has not been fully performed.
The amount of the brokerage's commission that goes to the realtor

11. Savings Banks (S&L's)
A major source of funds for financing residential real estate.
No: misrepresentation of fact; negligent misrepresentation; innocent misrepresentaton. MI law says seller's broker is not liable for statments made to buyer/customer regarding condition of property.
A promise in a deed that the title causes no encumbrances except those set forth in the deed.
One in which the payments are lower in the early years but increase on a scheduled bass until they reach an amortizing level.

12. Contract for deed
Real Estate Investment Trusts (the what mutual funds are to stocks REITs are to mortgages - sort of)
Anything of value - as recognized by law - offered as an inducement to contract.
Condominium unit composed of only vacant land with surface improvements or with air space within which a building is to be constructed.
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. Steering
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
The practice of directing prospective purchasers toward or away from certain neighborhoods to avoid altering the racial/ethnic makeup of these areas.
Savings banks - mutual savings banks - commercial banks
Court ordered awards for extremely bad behavior by a party; intended to punish and indicate that the behavior will not be tolerated

14. Real Estate Settlement Procedures Act (RESPA)
The principal in a real estate transaction
Evidence that a valid debt exists
The shortened name for the Federal National Mortgage Association (FNMA) - a privately owned corporation that purchases FHA - VA - and conventional mortgages
A federal law regulating activities of lending institutions in making mortgage loans for housing.

15. Breach of contract
Continuing to occupy property after lawful authorizatio has expired; a form of leasehold estate
The duty of agents not to disclose any information about their clients.
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.
Failure - wthout legal excuse - to perform any proise that forms the whole or part of a contract.

16. Jones v. Mayer
A property owner employs a real estate firm to market a property for a prescribed period of time at a prescribed price and terms
(a) Recipient of a gift of personal property by will. (b) Lender in a deed of trust.
Supreme Court decision upholding Civil Right Act of 1866; under no circumstances is anyone exempted from the law prohibiting racial discrimination
Court ordered awards for extremely bad behavior by a party; intended to punish and indicate that the behavior will not be tolerated

17. Involuntary alienation
One in which the payments are lower in the early years but increase on a scheduled bass until they reach an amortizing level.
E.g. Bankruptcy - foreclosure - eminent domain - condemnaton
Time - title - interest - and possession; concurrent ownerships require at least one unity between co-owners.
Agent with limited authority to act on behalf of the principal - such as created by a listing (realtors acting for realtors???)

18. Offer and acceptance
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.
Necessary elements for the creation of a contract.
The limited warranty deed limits the potential liability of the seller and does not hold him liable for any encumbrances against the property prior to his ownership.
A form of co-ownership that does not include the right of survivorship.

19. Granting clause
Cash sales - New financing
The rights of an owner of a freehold estate to possession - enjoyment - control - and disposition of real property.
A policy insuring an owner of real property against financial loss resulting from a title defect.
The statement in a deed containing words of conveyance

20. Junior mortgage
one that is subordinate to a subsequent mortgage (e. g. - a second mortgage)
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.
Prohibits a real estate licensee from engaging in a transaction that could be viewed as a security
Preventing a person from making a statement contrary to a previous statement

21. Unities of ownership
Time - title - interest - and possession; concurrent ownerships require at least one unity between co-owners.
Interest only loan (e. g. - construction loan--you are only paying interest - no principal)
A form of co-ownership lmited to husband and wife; does not include the right of survivorship
The outlay of money expecting income or profit or the acquisition of property expecting income or profit

22. Acknowledgment
Document signed under oath by vendor stating that vendor has not encumbered title to real estate without full disclosure to vendee.
A combination of the graduated payment mortgage and the variable rate mortgage
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.
Substitution of a new contract for a prior contract.

23. Guaranteed Loan Program
Cancellation of a contract when another party is in default
Should an individual borrower default on a loan - the Rural Housing Service will pay the private financier for the loan
The principle stating that when the net profit a property generates is excessive - very strong competition will result
An estimate of value of a particular property - at a particular time for a specified purpose.

24. Fannie Mae (FNMA)
A policy that insures a mortgagee against defects in a title pledged by a morgagor to secure payment of a mortgage loan.
The shortened name for the Federal National Mortgage Association (FNMA) - a privately owned corporation that purchases FHA - VA - and conventional mortgages
Agreement of the parties; full performance; iimpossibility of performance; operation of law (judge's ruling)
Condominium unit composed of only vacant land with surface improvements or with air space within which a building is to be constructed.

25. Duress
The inability of a party to exercise his or her free will because of fear of another party.
Land and everything permanently attached to land
A court judgment obtained by a mortgagee for the amount of money a foreclosure sale proceeds were deficient in fully satisfying the mortgage debt.
One in which the federal government does not insure or guarantee payment to the lender.

26. Assignor
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.)
The person transferring contractual rights to another
A three-day right of rescission for certain loan transactions
One insuring a lessee against defects in the lessor's title.

27. Rectangular survey system
A law in effect in all states requiring certain contracts to be in writing to be valid.
Interest only loan (e. g. - construction loan--you are only paying interest - no principal)
Item that is installed by a comercial tenant and is removable upon termination of the tenancy
A type of land descripton utilizing townships and sections

28. Margin
Evidence that a valid debt exists
Paid to Cooperating Brokers Usually 50%/50%
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.
Measure of profit

29. Interest
Court ordered awards for extremely bad behavior by a party; intended to punish and indicate that the behavior will not be tolerated
Agreement of the parties; full performance; iimpossibility of performance; operation of law (judge's ruling)
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) Money paid for the use of money. (b) An ownership or right.

30. Promissory note
Evidence that a valid debt exists
Financinig charge required by the lender
The aggregate of rights - powers - and priveleges conveyed with ownership of real estate
Allows certain parcels of property to be removed from the mortgage lien if the loan balance is reduced a specified amount

31. Heterogeneity
No two parcels of land are identical
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
A person appointedby an agent to assist in performing some or all of the tasks of the agency
The reversion of property to the state or county - as provide by state law - in cases where a decedent dies intestate without heirs capable of inheriting - or when the property is abandoned

32. Right of assignment
No two parcels of land are identical
Allows lender to sell mortgage at any time and obtain money invested rather than wait for completion of loan term.
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.
Successive conveyances of title to a specific parcel of land.

33. Mortgagor
E.g. very accurate desc or property)
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
One who takes over management of a property until the foreclosure process is complete
The borrower in a mortgage loan who executes and delivers a mortgage to the lender.

34. Construction mortgage
No two parcels of land are identical
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.
Doesn't happen anymore in this climate
A temporary mortgage used to borrow money to contruct an improvement on land

35. Complete performance
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.
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.
The reversion of property to the state or county - as provide by state law - in cases where a decedent dies intestate without heirs capable of inheriting - or when the property is abandoned
Execution of a contract by vrtue of all parties having fully performed all terms

36. Leverage

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

37. Misrepresentation
One that may be refinanced without rewriting the mortgage.
A gift of real property by will
Land and everything permanently attached to land
(a) A false statement or omission of a material fact. (b) In real estate - making an unintentionally false statement to induce someone to contract

38. Condominium
Nonfreehold estate; of limited duration - providing the right of possession and control but not title.
One in which two more parcels of real property are pledged to secure payment of the note
A statutory form of deed in which the warranties are mplied from the statute rather than being spelled out in the deed.
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.

39. Caveat emptor
The third party in a real estate transaction
Savings banks - mutual savings banks - commercial banks
Latin meaning "let the buyer bewar"; applies to "sales talk" and not to statements of material facts.
Any property acquuired by one spouse during marriage by gift or inheritance or purchased with the separate funds of a husband or wife.

40. Emblements
Personal property growing in the soil - requiring planting and cultivation; annual crops.
One that does not impose a prepayment penalty.
In Michigan - a person appointed by a court to distrbute the property of a person dying intestate
A major source of funds for financing residential real estate.

41. Verc test
A test of soil to determine if it is sufficiently porous for installation of a septic tank.
A written instrument used to pledge a title to real property to secure payment of a promissory note.
Financinig charge required by the lender
Agent with limited authority to act on behalf of the principal - such as created by a listing (realtors acting for realtors???)

42. Alienation
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.
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.
Transfer of title to real property
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.

43. Property description
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
An agreement between competent parties upon legal consideration (e. g. money - property - promise - etc. ) to do - or abstain from doing - some legal act.
An accurate legal description of land
A form of co-ownership lmited to husband and wife; does not include the right of survivorship

44. Grantor
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.
One who conveys title to real property by deed
A report usually provided by a local municipality health department to determine the potability of water and to ascertain that the septic system is running free
The violations and fines or penalties - which the department and the licensee have agreed upon.

45. Assignee
A form of co-ownership that does not include the right of survivorship.
Cash sales - New financing
One to whom contractual rights are transferred
The statement in a deed beginning with the words "to have and to hold" and describing the estate granted

46. Open-end mortgage
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 leasehold estate of definite duration
One that may be refinanced without rewriting the mortgage.
The largest and most prominent trade organization of real estate licensees.

47. Implied contract
Governmental restrictions on land use
One who takes over management of a property until the foreclosure process is complete
One crated by deduction from the conduct of the parties rather than from the direct words of the parties; opposite of an express contract.
A freehold estate created for the duration of the life or lives of certain named persons; a non-inheritable estate

48. Disclosure of information
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.
The prompt and total communication to the principal by the agent of any information that is material to the transaction for which the agency is created.
Personal property
A mortgage given by a buyer to a seller to secure payment of all or part of the purchase price.

49. Michigan Condominium Act
Should an individual borrower default on a loan - the Rural Housing Service will pay the private financier for the loan
Details rights of condominium purchasers in Michigan
Prohibits certain practices in trade or commece and provides for certain remedies.
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.

50. Universal agent
Agent that has complete authority over any activity of principal; for example - power of attorney
Latin meaning "let the buyer bewar"; applies to "sales talk" and not to statements of material facts.
Cancellation of a contract when another party is in default
Nonfreehold estate; of limited duration - providing the right of possession and control but not title.