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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. Testimonium clause

2. Open-end mortgage
A mortgage given by the seller to the buyer to cover all or part of the sale price. Seller financing.
A deed containing a limited warranty of title
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
One that may be refinanced without rewriting the mortgage.

3. Consideration
Anything of value - as recognized by law - offered as an inducement to contract.
Mutual agreement between the parties to a contract; meeting of the minds; to exist and be free of duress - fraud - undue influence - and misrepresentation.
One that does not impose a prepayment penalty.
A report - based on a title examination - setting forth the examiner's opinion of the quality of a title to real property.

4. Mortgage
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 written instrument used to pledge a title to real property to secure payment of a promissory note.
The principle stating that when the net profit a property generates is excessive - very strong competition will result
Return of title to the holder of a future interest - such as the grantor in a life estate not in remainder

5. Retainer
Transfer of legal rights and obligations by one party to another
An agreement between competent parties upon legal consideration (e. g. money - property - promise - etc. ) to do - or abstain from doing - some legal act.
A new offer made by an offer or rejecting an offer.
A fee paid to an agent in advance for representation instead of commission; usually if commission exceeds retainer - a refund would be issued.

6. Earnest money
An error of material fact by both parties
A federal law regulating activities of lending institutions in making mortgage loans for housing.
(a) Money paid for the use of money. (b) An ownership or right.
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.

7. Mortgage assumption

8. Immobility
One who holds title to property for the benefit of another called a beneficiary
Land was owned or controlled by the King
A responsibility for revealing all information that affects the agency agreement
Land cannot be relocated

9. Owner's policy
Transfer of legal rights and obligations by one party to another
A policy insuring an owner of real property against financial loss resulting from a title defect.
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.

10. Closing statement
A listing given to one or more brokers wherein the broker procuring a sale is entitled to the commission but imposes no commission obligation on the owner in the event the owner sells the property to someone who was not interested in the property by
An accounting of the funds received and disbursed in a real estate transaction.
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
Conveyance of title to the mortgagor in default to avoid a record of foreclosure. Also called friendly foreclosure

11. Vroration
Devotion of certain settlement costs between buyer and seller.
Allows lender to sell mortgage at any time and obtain money invested rather than wait for completion of loan term.
A test of soil to determine if it is sufficiently porous for installation of a septic tank.
Permanence of land--makes it an attractive long term investment

12. Property description
Permission to assume the mortgage at an interest rate prevailing at the time of assumption
An accurate legal description of land
A search of the public record to determne the quality of a title to real property
A deed denoting an unlimited guarantee of title

13. Unenforceable contract
A form of co-ownership that does not include the right of survivorship.
One that appears to meet the requirements for validity but would not be enforceable in court.
Another term for escrow account
Land and everything permanently attached to land

14. Quitclaim deed
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.
A form of co-ownership limited to husband and wife - with the right of survivorship
Regulates the licensing and registration of persons who make - broker - or service one- to four-family residential first mortgage loans secured by Michigan property.
A deed of release that contains no warranty of title; used to remove a cloud on a title. A deed to relinquish or release a claim to real property.

15. Assignment
Investigates alleged discrimination and secures the equal protection of civil rights.
The U. S. agency that insures mortgage loans to protect lending institutions.
Mortgage allowing elderly homeowners to borrow against the equity in their homes to help meet living expenses.
Transfer of legal rights and obligations by one party to another

16. Chain of title
Title insurance that protects contract buyer against defects in contract seller's title.
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
A combination of the graduated payment mortgage and the variable rate mortgage
Successive conveyances of title to a specific parcel of land.

17. Subrogation of rights
A law adding to the Fair Housing Act provisions to prevent discrimination based on mental or physical handicap or familial status
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.
The substitution of the title insurance company in the place of the insured for filing a legal action.
A statutory form of deed in which the warranties are mplied from the statute rather than being spelled out in the deed.

18. Leasehold estate
Nonfreehold estate; of limited duration - providing the right of possession and control but not title.
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.
Measure of profit
North-south line in the rectangular method of property description.

19. Condominium
(a) An economic characteristic of real property. (b) In appraisal - supply of property in relation to effective demand
One that may be refinanced without rewriting the mortgage.
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.
Paid to Cooperating Brokers Usually 50%/50%

20. Grantor
One who conveys title to real property by deed
One in which the federal government does not insure or guarantee payment to the lender.
An accurate legal description of land
A law adding to the Fair Housing Act provisions to prevent discrimination based on mental or physical handicap or familial status

21. Special agent
A life estate based on the life of another
A deed denoting an unlimited guarantee of title
Agent with limited authority to act on behalf of the principal - such as created by a listing (realtors acting for realtors???)
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

22. Client
Founded on natural duty and affection. Has no pecuniary value.
A one-mile-square area of land described by the rectangular survey system - consisting of 640 acres
The principal in a real estate transaction
One in which personal property as well as real property s pledged to secure payment of the note.

23. vendor's affidavit
One in which all affected parties are bound by the knowledge of a fact even though they have not been actually notified of such fact.
Mortgage allowing elderly homeowners to borrow against the equity in their homes to help meet living expenses.
Cash sales - New financing
Document signed under oath by vendor stating that vendor has not encumbered title to real estate without full disclosure to vendee.

24. 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.
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
An agreement between competent parties upon legal consideration (e. g. money - property - promise - etc. ) to do - or abstain from doing - some legal act.
Use of land that will preserve the dand utility - provide the greatest income - and result in the greatest present value of the land

25. Vartial release clause
An agreement that has not been fully performed.
Allows certain parcels of property to be removed from the mortgage lien if the loan balance is reduced a specified amount
Mortgage allowing elderly homeowners to borrow against the equity in their homes to help meet living expenses.
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.

26. Acceptance
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 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
Voluntary expression by the person receiving the offer to be bound by the exact terms of the offer; must be unequivocal and unconditional

27. General agent
A combination of the graduated payment mortgage and the variable rate mortgage
One with full authority over one property of the principal - such as a property manager
Item that is installed by a comercial tenant and is removable upon termination of the tenancy
An insurance policy protecting the insured from a financial loss caused by a defect in a title to real property (Buyer buys for mortgage company for amount of mortgage; seller pays for buyer on full price of property).

28. Complete performance
Execution of a contract by vrtue of all parties having fully performed all terms
A deed issued to the buyer of property that was sold under court order to pay off a debt.
One who holds title to property for the benefit of another called a beneficiary
A responsibility for revealing all information that affects the agency agreement

29. Constructive notice
An agreement between competent parties upon legal consideration (e. g. money - property - promise - etc. ) to do - or abstain from doing - some legal act.
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 all affected parties are bound by the knowledge of a fact even though they have not been actually notified of such fact.
Seller

30. Contract buyer's policy

31. Merger
A gift of real property by will
When a subsequent contract covering the same subject matter is drafted (with changes)
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.
Successive conveyances of title to a specific parcel of land.

32. Condition
An estimate of value of a particular property - at a particular time for a specified purpose.
Any act or event that - if it occurs or fails to occur - automatically creates or extinguishes a legal obligation.
Evidence that a valid debt exists
A federal prohibition on discrimination in the sle - rental - or financing of housing on the basis of race - color - religion - sex - or national origin

33. Timesharing
A contract whereby aproperty owner employs a real estate broker to market the property described in the contract
A mortgage loan in which the loan payment is guaranteed to the lender by the Department of Veterans Affairs.
Substitution of a new contract for a prior contract.
A form of ownership in which the purchsaser owns the property for a certain specified time interval.

34. Option
A leasehold estate of definite duration
A contract whereby a property owner (optioner) sells a right to purchase his or her property to a prospective buyer (optionee).
License law term that describes a type of relationship between a broker and his or her licensees
The shortened name for the Federal National Mortgage Association (FNMA) - a privately owned corporation that purchases FHA - VA - and conventional mortgages

35. Mortgagee
The lender in a mortgage loan - who receives a mortgage from the borrower (mortgagor).
The market in which lenders sell mortgages
A new agreement by contracting parties that is satisfied by full performance there by terminating the prior contract as well
An instrument transferring ownership of personal property.

36. Rural Housing Service (RHS) Direct Loan Program
In Michigan - a person appointed by a court to distrbute the property of a person dying intestate
One in which uniform installment payments include payment of both principle and interest.
Provides financng for rural Americans with incomes below 80 percent of the median income level in the community where they live.
A buyer of property who relies on the records and is unaware of an unrecorded prior document

37. Competence
A mental or physical disability that impairs any of a person's life functions.
The principle stating that when the net profit a property generates is excessive - very strong competition will result
Interest only loan (e. g. - construction loan--you are only paying interest - no principal)
One who conveys title to trustee

38. Covenant of quiet enjoyment

39. Right of survivorship

40. Blanket mortgage
One in which two more parcels of real property are pledged to secure payment of the note
.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 transfer of mortgage obligations to purchaser of the mortgaged property.
A payment for insurance to protect the lender and/or insurer against loss if default occurs.

41. Steering
The practice of directing prospective purchasers toward or away from certain neighborhoods to avoid altering the racial/ethnic makeup of these areas.
Agent with limited authority to act on behalf of the principal - such as created by a listing (realtors acting for realtors???)
No two parcels of land are identical
E.g. Bankruptcy - foreclosure - eminent domain - condemnaton

42. Habendum clause
The statement in a deed beginning with the words "to have and to hold" and describing the estate granted
The substitution of the title insurance company in the place of the insured for filing a legal action.
A registered trademark of the National Associaton of REALTORS*; its use is limited to members only.
Interest only loan (e. g. - construction loan--you are only paying interest - no principal)

43. Accord and satisfaction
Lender's estimate of borrower's settlement costs - required by RESPA to be furnished to borrower at time of loan application
A new agreement by contracting parties that is satisfied by full performance there by terminating the prior contract as well
An agreement between competent parties upon legal consideration (e. g. money - property - promise - etc. ) to do - or abstain from doing - some legal act.
When a subsequent contract covering the same subject matter is drafted (with changes)

44. Supply and demand
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.
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 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
The relatonship between the amont of a mortgage loan and the lender's opinion of the value of the property pledged to secure payment of the loan.

45. Michigan Civil Rights Commission
Investigates alleged discrimination and secures the equal protection of civil rights.
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.
Second mortgage
Ownership by only one person

46. Estoppel
Real Estate Investment Trusts (the what mutual funds are to stocks REITs are to mortgages - sort of)
Preventing a person from making a statement contrary to a previous statement
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
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.

47. Compensatory damages
The person transferring contractual rights to another
A future interest in a life estate
The amount of money actually lost - which will be awarded by a court in case of a breached contract
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

48. Homogeneity
An estimate of value of a particular property - at a particular time for a specified purpose.
Neighborhoods that are made up of similar properties
A mortgage given by the seller to the buyer to cover all or part of the sale price. Seller financing.
A deed denoting an unlimited guarantee of title

49. Investment
The outlay of money expecting income or profit or the acquisition of property expecting income or profit
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
A major source of funds for financing residential real estate.
Occurs when a seller's broker conceals a defect in the property from the buyer or misrepresents the existence of a defect

50. Balloon mortgage
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.
The portion of a deed that contains the grantor's and witnesses' signatures and the acknowledgment (notary).
.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.
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.