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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. Universal agent
Written registration of an owner's title in public records to protect against subsequent claimants.
Agent that has complete authority over any activity of principal; for example - power of attorney
Allows certain parcels of property to be removed from the mortgage lien if the loan balance is reduced a specified amount
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.

2. Fair Housing Amendments Act of 1988
Money to be paid and received as compensaton for a breach of contract.
One who receives title to real property by deed
A law adding to the Fair Housing Act provisions to prevent discrimination based on mental or physical handicap or familial status
A claim against a title to real property.

3. Michigan Consumer Protection Act
The statement in a deed beginning with the words "to have and to hold" and describing the estate granted
Prohibits certain practices in trade or commece and provides for certain remedies.
The amount of the brokerage's commission that goes to the realtor
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)

4. Trustee
A law in effect in all states requiring certain contracts to be in writing to be valid.
Occurs when the first adverse possessor transfers possession to another person who continues as an adverse possessor
One who holds title to property for the benefit of another called a beneficiary
The inability of a party to exercise his or her free will because of fear of another party.

5. Association of Real Estate License Law Officials (ARELLO)
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)
Make good loans to qualified borrowers ( e. g. Rural Development loans)
A husband's interest in the real property of his wife
Organization established in 1929 by license law officials on the state commissions to assist one another in creating - administering - and enforcing license laws.

6. Deed of trust
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.
A form of mortgage wherein there is a third party - who is called a trustee
Organization established in 1929 by license law officials on the state commissions to assist one another in creating - administering - and enforcing license laws.

7. National Association of Realtors
When a subsequent contract covering the same subject matter is drafted (with changes)
A nickname for the Government National Mortgage Association (GNCMA) - a U. /S. government agency that purchaes FHA and VA mortgages.
The largest and most prominent trade organization of real estate licensees.
A type of land descripton utilizing townships and sections

8. Metes and bounds
A written instrument transferring an interest in real property when delivered to the grantee.
E.g. very accurate desc or property)
A form of mortgage wherein there is a third party - who is called a trustee
(a) A false statement or omission of a material fact. (b) In real estate - making an unintentionally false statement to induce someone to contract.

9. Mortgage principal
The outlay of money expecting income or profit or the acquisition of property expecting income or profit
Title insurance that protects contract buyer against defects in contract seller's title.
The amount of money (usually the loan amount) on which interest is either paid or recieved.
A written instrument transferring an interest in real property when delivered to the grantee.

10. Steering
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
The practice of directing prospective purchasers toward or away from certain neighborhoods to avoid altering the racial/ethnic makeup of these areas.
A mortgage given by a buyer to a seller to secure payment of all or part of the purchase price.
Regulates the licensing and registration of persons who make - broker - or service one- to four-family residential first mortgage loans secured by Michigan property.

11. Accrued expenses
Expenses seller owes on the day of closing but for which the buyer will take responsibility (such as property taxes)
Legal purpose.
A temporary mortgage used to borrow money to contruct an improvement on land
(a) An economic characteristic of real property. (b) In appraisal - supply of property in relation to effective demand

12. Designated agency
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.)
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)
Mutual agreement between the parties to a contract; meeting of the minds; to exist and be free of duress - fraud - undue influence - and misrepresentation.
The instrument that legally establishes a condominium; also called condominium declaration

13. Undue influence
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.
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
Purchaser
North-south line in the rectangular method of property description.

14. Convey
To pass to another (as in title)
A wife's interest in her husband's real property
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) A false statement or omission of a material fact. (b) In real estate - making an unintentionally false statement to induce someone to contract

15. Testator/testatrix
The transfer of a title by deed requires the grantor to deliver and the grantee to accept a given deed.
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.
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 man/woman who has died and left a valid will

16. Deed - what makes it valid
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
The violations and fines or penalties - which the department and the licensee have agreed upon.
A person appointedby an agent to assist in performing some or all of the tasks of the agency
The statement in a deed containing words of conveyance

17. Recordation

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18. Michigan Uniform Securities Act
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
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
Prohibits a real estate licensee from engaging in a transaction that could be viewed as a security
Assures the absence of hazardous materials or problems relating to regulations of the EPA.

19. Earnest money
An agreement that is legally binding and enforceable.
A deed containing a limited warranty of title
Mandates that the seller complete a disclosure form regarding the condition of the property
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.

20. Vroration
Financinig charge required by the lender
The duty of agents not to disclose any information about their clients.
Devotion of certain settlement costs between buyer and seller.
A claim against a title to real property.

21. Implied contract
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 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
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.
The introductory information on a deed

22. Valid contract
A form of co-ownership that does not include the right of survivorship.
Details rights of condominium purchasers in Michigan
An agreement that is legally binding and enforceable.
MI law stating that if the property is being destroyed - is partially destroyed - or is being taken by eminent domain - the buyer may - at the buyer's option - declare the transaction null and void.

23. Michigan's Seller Disclosure Act
Mandates that the seller complete a disclosure form regarding the condition of the property
A promise in a deed that the grantor will guarantee and defend the title against lawful claimants.
The right for property to descend to the heirs of the owner as set out by will or by intestate succession.
A physical or mental impairment that substantially limits one or more of the major life activities of a person

24. Unities of ownership
An agreement that may be voided by the parties without legal consequences.
One who conveys title to trustee
Time - title - interest - and possession; concurrent ownerships require at least one unity between co-owners.
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.

25. Acceleration clause
A leasehold estate of definite duration
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.
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 accurate legal description of land

26. Breach of contract
Governmental restrictions on land use
The largest and most prominent trade organization of real estate licensees.
The principle stating that when the net profit a property generates is excessive - very strong competition will result
Failure - wthout legal excuse - to perform any proise that forms the whole or part of a contract.

27. Sales Transactions
(a) A false statement or omission of a material fact. (b) In real estate - making an unintentionally false statement to induce someone to contract
The statement in a deed beginning with the words "to have and to hold" and describing the estate granted
License law term that describes a type of relationship between a broker and his or her licensees
Cash sales - New financing

28. Reversion
Personal property growing in the soil - requiring planting and cultivation; annual crops.
Return of title to the holder of a future interest - such as the grantor in a life estate not in remainder
A broker/salesperson's representing both buyer and seller in the same transaction (Mention at each of the first meetings with buyer and seller)
Investigates alleged discrimination and secures the equal protection of civil rights.

29. Testimonium clause

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30. Equal Credit Opportunity Act (ECOA)
A promise in a deed that the grantor will guarantee and defend the title against lawful claimants.
Voluntary expression by the person receiving the offer to be bound by the exact terms of the offer; must be unequivocal and unconditional
A leasehold estate of definite duration
A federal law prohibiting discrimination in consumer loans

31. Sherriff's deed
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.
OLD CAR Obedience - Loyalty - Disclosure of info - Confidentiality - Accounting - Reasonable xxx? - care - and diligence
A threshold after which a realtor keeps all commissions and the broker keeps none
A deed issued to the buyer of property that was sold under court order to pay off a debt.

32. Bargain and sale deed
The governing board for real estate licenses in MI
One that is free from reasonable doubt and that a court would require a purchaser to accept
A form of deed with or without covenants of title
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

33. Negligent misrepresentation

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34. Right of first refusal
Measure of profit
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.
Cash sales - New financing
Prohibits a real estate licensee from engaging in a transaction that could be viewed as a security

35. PITI ppayment
The largest and most prominent trade organization of real estate licensees.
The violations and fines or penalties - which the department and the licensee have agreed upon.
Acronym denoting that a mortgage payment includes principal - interest - taxes - and insurance.
Permanence of land--makes it an attractive long term investment

36. Buyer's contract
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
Individual - private ownership of land
One in which the federal government does not insure or guarantee payment to the lender.
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.

37. Executed contract
A tax imposed on the conveyance of title to real property by deed
An agreement that has been fully performed.
An implied agency without an agency agreement
One in which the interest rate changes according to changes in a predetermined index.

38. Agency disclosure

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39. Scarcity
The attribute of an asset's being readily convertible to cash.
(a) An economic characteristic of real property. (b) In appraisal - supply of property in relation to effective demand
Seller
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

40. General warranty deed
A law in effect in all states requiring certain contracts to be in writing to be valid.
Purchaser
A deed denoting an unlimited guarantee of title
The duty of agents not to disclose any information about their clients.

41. Bilateral 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 nstallment land contract contract for deed - and conditional sales contract.
An agreement based on mutual promises that provide the consideration. (A "done deal" both parties have fulfilled promises)
Anything of value agreed upon by parties to a contract. Includes a promise.
A future interest in a life estate

42. Bequest
A gift of personal property by will.
A property owner employs a real estate firm to market a property for a prescribed period of time at a prescribed price and terms
The U. S. agency that insures mortgage loans to protect lending institutions.
A report - based on a title examination - setting forth the examiner's opinion of the quality of a title to real property.

43. Personal property
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.)
All property that is not land and is not permanently attached to land; everything that is movable; chattel.
A man/woman who has died and left a valid will
Use of land that will preserve the dand utility - provide the greatest income - and result in the greatest present value of the land

44. Intestate
There are certain types of trade restraints that are so injurious to competition that there can be no justification for them (price fixing; boycotts or concerted refusals to deal; territorial or customer allocation; tying agreements)
(a) Recipient of a gift of personal property by will. (b) Lender in a deed of trust.
A man/woman who has died and left a valid will
The condition of death without leaving a valid will.

45. Closed mortgage
A new agreement by contracting parties that is satisfied by full performance there by terminating the prior contract as well
A promise in a deed that the grantor will guarantee and defend the title against lawful claimants.
A licensee involved in a real estate transacton without having a relationship with the buyer or the seller
One that imposes a prepayment penalty.

46. Homogeneity
The borrower in a mortgage loan who executes and delivers a mortgage to the lender.
The portion of a deed that contains the grantor's and witnesses' signatures and the acknowledgment (notary).
The attribute of an asset's being readily convertible to cash.
Neighborhoods that are made up of similar properties

47. Tenants by the entirety
One that requires the mortgagor to pay interest only during the mortgage term - with the principal due at the end of the term.
A form of co-ownership limited to husband and wife - with the right of survivorship
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.
Permission to assume the mortgage at an interest rate prevailing at the time of assumption

48. Redlining
In a closing statement - an expense or money received against a credit
The right of an owner to recieve the title to an co-owner's share upon death of the co-owner - as in the case of joint tenancy and tenancy by the entirety.
Failure - wthout legal excuse - to perform any proise that forms the whole or part of a contract.
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

49. Personal representative
In Michigan - a person appointed by a court to distrbute the property of a person dying intestate
The transfer of a title by deed requires the grantor to deliver and the grantee to accept a given deed.
Anything of value - as recognized by law - offered as an inducement to contract.
The practice of directing prospective purchasers toward or away from certain neighborhoods to avoid altering the racial/ethnic makeup of these areas.

50. Construction mortgage
A report - based on a title examination - setting forth the examiner's opinion of the quality of a title to real property.
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
A temporary mortgage used to borrow money to contruct an improvement on land
E.g. Put on market - sell - done)