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. Novation
The largest and most prominent trade organization of real estate licensees.
An agency relationship created by oral or written agreement between principal and agent
A major source of funds for financing residential real estate.
Substitution of a new contract for a prior contract.


2. Revenue stamps
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 policy insuring an owner of real property against financial loss resulting from a title defect.
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 written instrument used to pledge a title to real property to secure payment of a promissory note.


3. Estate at sufferance
Continuing to occupy property after lawful authorizatio has expired; a form of leasehold estate
Seller
The statement in a deed beginning with the words "to have and to hold" and describing the estate granted
Land was owned or controlled by the King


4. VA-guaranteed loan
A mortgage loan in which the loan payment is guaranteed to the lender by the Department of Veterans Affairs.
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
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.


5. Michigan Person's with Disabilities CiveI Rights Act

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6. Retainer
A law in effect in all states requiring certain contracts to be in writing to be valid.
One who holds title to property for the benefit of another called a beneficiary
A fee paid to an agent in advance for representation instead of commission; usually if commission exceeds retainer - a refund would be issued.
A form of co-ownership that includes the right of survivorship


7. Investment
One that is free from reasonable doubt and that a court would require a purchaser to accept
(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
A life estate based on the life of another
The outlay of money expecting income or profit or the acquisition of property expecting income or profit


8. Blanket mortgage
Successive conveyances of title to a specific parcel of land.
Conveyance of title to the mortgagor in default to avoid a record of foreclosure. Also called friendly foreclosure
One in which two more parcels of real property are pledged to secure payment of the note
Preventing a person from making a statement contrary to a previous statement


9. Hypothecating
Mandates that the seller complete a disclosure form regarding the condition of the property
Pledging property as security for the payment of a debt without giving up possession.
Permanent financing arranged to replace a shor-term construction loan.
Substitution of a new contract for a prior contract.


10. Estate at will
Devotion of certain settlement costs between buyer and seller.
Land and everything permanently attached to land; sometimes used interchangeably with the terms real property and realty
Contract where all terms are in writing and understood by both parties.
A leasehold estate that may be terminated at the desire of either party


11. Mutual mistake
OLD CAR Obedience - Loyalty - Disclosure of info - Confidentiality - Accounting - Reasonable xxx? - care - and diligence
An error of material fact by both parties
A law adding to the Fair Housing Act provisions to prevent discrimination based on mental or physical handicap or familial status
A written instrument transferring an interest in real property when delivered to the grantee.


12. Acceptance
A buyer of property who relies on the records and is unaware of an unrecorded prior document
In a closing statement - an expense or money received against a credit
E.g. Put on market - sell - done)
Voluntary expression by the person receiving the offer to be bound by the exact terms of the offer; must be unequivocal and unconditional


13. Fee simple absolute
An agreement that has no legal force or effect.
The practice of directing prospective purchasers toward or away from certain neighborhoods to avoid altering the racial/ethnic makeup of these areas.
An inheritable estate in land providing the greatest interest of any form of title
.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.


14. Accord and satisfaction
A type of land descripton utilizing townships and sections
An agreement that is legally binding and enforceable.
A new offer made by an offer or rejecting an offer.
A new agreement by contracting parties that is satisfied by full performance there by terminating the prior contract as well


15. REITs
The principle stating that when the net profit a property generates is excessive - very strong competition will result
Real Estate Investment Trusts (the what mutual funds are to stocks REITs are to mortgages - sort of)
A form of foreclosure that does not require court action to conduct a foreclosure sale; also called foreclosure under power of sale.
Return of title to the holder of a future interest - such as the grantor in a life estate not in remainder


16. Heterogeneity
No two parcels of land are identical
Condominium unit composed of only vacant land with surface improvements or with air space within which a building is to be constructed.
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.
Describes a buyer who is ready to buy - willing to buy - and financially able to pay the asking price.


17. Guaranteed Loan Program
Should an individual borrower default on a loan - the Rural Housing Service will pay the private financier for the loan
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
Interest only loan (e. g. - construction loan--you are only paying interest - no principal)
The transfer of a title by deed requires the grantor to deliver and the grantee to accept a given deed.


18. Interest
(a) Money paid for the use of money. (b) An ownership or right.
Permanence of land--makes it an attractive long term investment
A deed denoting an unlimited guarantee of title
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.


19. Bill of sale
An instrument transferring ownership of personal property.
A form of co-ownership limited to husband and wife - with the right of survivorship
A form of co-ownership that does not include the right of survivorship.
one that is subordinate to a subsequent mortgage (e. g. - a second mortgage)


20. Right of inheritance
Ownership by only one person
The right for property to descend to the heirs of the owner as set out by will or by intestate succession.
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 form of co-ownership that does not include the right of survivorship.


21. Parol evidence rule
A document setting forth the value of a property as the basis for the loan guarantee by the Veterans Administration to the lender.
A concept allowing that oral explanations can support the wrtten words of contract but cannot contradict them.
The amount of money actually lost - which will be awarded by a court in case of a breached contract
Pledging property as security for the payment of a debt without giving up possession.


22. Appraisal
An estimate of value of a particular property - at a particular time for a specified purpose.
One with full authority over one property of the principal - such as a property manager
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
Failure - wthout legal excuse - to perform any proise that forms the whole or part of a contract.


23. Ready willing and able
Describes a buyer who is ready to buy - willing to buy - and financially able to pay the asking price.
The practice of directing prospective purchasers toward or away from certain neighborhoods to avoid altering the racial/ethnic makeup of these areas.
The instrument that legally establishes a condominium; also called condominium declaration
Successive conveyances of title to a specific parcel of land.


24. Straw Dog
Successive conveyances of title to a specific parcel of land.
An agent working for an unnamed third party buyer (usually a celebrity)
The inability of a party to exercise his or her free will because of fear of another party.
A leasehold estate that may be terminated at the desire of either party


25. Discharge of contracts

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26. Concurrent ownership
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
Simultaneous ownership of real property by two or more people
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 federal law regulating activities of lending institutions in making mortgage loans for housing.


27. Condition subsequent
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)
A relationship that meets the following criteria: (1) the broker and licensee must have a written agreement stating that the licensee is not an employee for federal and state or income tax purposes - and (2) not less than 75 percent of the licensse's
Multiple joint participation in a real estate investment. May be a real estate trust - corporation - or partnership.
One that does not impose a prepayment penalty.


28. Metes and bounds
The third party in a real estate transaction
A policy that insures a mortgagee against defects in a title pledged by a morgagor to secure payment of a mortgage loan.
Nonfreehold estate; of limited duration - providing the right of possession and control but not title.
E.g. very accurate desc or property)


29. Settlement
The right for property to descend to the heirs of the owner as set out by will or by intestate succession.
Consummation of a real estate contract; also called closing.
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.)
A concept allowing that oral explanations can support the wrtten words of contract but cannot contradict them.


30. Assignee
Any act or event that - if it occurs or fails to occur - automatically creates or extinguishes a legal obligation.
A contract whereby a property owner (optioner) sells a right to purchase his or her property to a prospective buyer (optionee).
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.
One to whom contractual rights are transferred


31. CConventional mortgage loan
A mortgage given by a buyer to a seller to secure payment of all or part of the purchase price.
One in which the federal government does not insure or guarantee payment to the lender.
A freehold estate created for the duration of the life or lives of certain named persons; a non-inheritable estate
One in which uniform installment payments include payment of both principle and interest.


32. Grantee
One insuring a lessee against defects in the lessor's title.
E.g. Put on market - sell - done)
Subject to being defeated by the occurrence of a certain event
One who receives title to real property by deed


33. Void contract
One who conveys title to real property by deed
An agreement that has no legal force or effect.
Substitution of a new contract for a prior contract.
Transfer of title to real property


34. Undue influence
The inability of a party to exercise his or her free will because of fear of another party.
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 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
No two parcels of land are identical


35. Chattel
Simultaneous ownership of real property by two or more people
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.
Personal property
A promise in a deed that the title causes no encumbrances except those set forth in the deed.


36. Executor /executrix
A form of organization that makes and services mortgage loans.
A man/woman appointed in a will to see that the terms of the will are carried out
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 husband's interest in the real property of his wife


37. Right of survivorship

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38. Estate for years
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 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 leasehold estate of definite duration
A federal law that prohibits all discrimination on the basis of race.


39. Acknowledgment
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 man/woman who has died and left a valid will
An accurate legal description of land
In a closing statement - an expense or money received against a credit


40. Equitable title

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41. Complete performance
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.
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
The manner in which rights and liabilities of parties may be changed by application of law without the act or cooperation of the parties.


42. Closing statement
A financial charge imposed on a borrower for paying a mortgage prior to experation of the full mortgage terms.
An accounting of the funds received and disbursed in a real estate transaction.
A law in effect in all states requiring certain contracts to be in writing to be valid.
A new agreement by contracting parties that is satisfied by full performance there by terminating the prior contract as well


43. Estoppel
Preventing a person from making a statement contrary to a previous statement
One that imposes a prepayment penalty.
A deed issued to the buyer of property that was sold under court order to pay off a debt.
One holding a life estate


44. Subagent
The third party in a real estate transaction
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
A person appointedby an agent to assist in performing some or all of the tasks of the agency
one that is subordinate to a subsequent mortgage (e. g. - a second mortgage)


45. Truth-in-Lending Simplification and Reform Act (TILSRA)
The duty of agents not to disclose any information about their clients.
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 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.
A gift of personal property by will.


46. Liquidity

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47. Caveat emptor
A payment for insurance to protect the lender and/or insurer against loss if default occurs.
A life estate based on the life of another
Latin meaning "let the buyer bewar"; applies to "sales talk" and not to statements of material facts.
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.


48. Discriminatory advertising
One who takes over management of a property until the foreclosure process is complete
Actually lending the $
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.
Document signed under oath by vendor stating that vendor has not encumbered title to real estate without full disclosure to vendee.


49. Covenant for further assurances
Assures the absence of hazardous materials or problems relating to regulations of the EPA.
The governing board for real estate licenses in MI
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
A contract whereby aproperty owner employs a real estate broker to market the property described in the contract


50. Certificate of title opinion

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