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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. Express agency
An agency relationship created by oral or written agreement between principal and agent
A tax imposed on the conveyance of title to real property by deed
A type of land descripton utilizing townships and sections
The outlay of money expecting income or profit or the acquisition of property expecting income or profit

2. Michigan Uniform Securities Act
Land was owned or controlled by the King
The market in which lenders sell mortgages
Prohibits a real estate licensee from engaging in a transaction that could be viewed as a security
An exaggeration of a property's benefits.

3. Bona fide purchaser
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 buyer of property who relies on the records and is unaware of an unrecorded prior document
Conveyance of title to the mortgagor in default to avoid a record of foreclosure. Also called friendly foreclosure
One with full authority over one property of the principal - such as a property manager

4. Mortgage assumption
Pledging property as security for the payment of a debt without giving up possession.
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
One in which the federal government does not insure or guarantee payment to the lender.
The transfer of mortgage obligations to purchaser of the mortgaged property.

5. Innocent misrepresentation

6. 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 nickname for the Government National Mortgage Association (GNCMA) - a U. /S. government agency that purchaes FHA and VA mortgages.
Multiple joint participation in a real estate investment. May be a real estate trust - corporation - or partnership.
A history of title and the current status of a title based on a atitle examination

7. Equitable redemption

8. Discount points
A percentage of the loan amount the lender requires for making a mortgage loan
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
Consummation of a real estate contract; also called closing.
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.

9. Delivery and acceptance
The transfer of a title by deed requires the grantor to deliver and the grantee to accept a given deed.
Expenses seller owes on the day of closing but for which the buyer will take responsibility (such as property taxes)
The power of government to regulate the use of real property for the benefit of the public
A white couple enters a racially restrictive covenant with a neighborhood. A black family - moved into this neighborhood. The white family brought it to court to enforce the contract and kept winning. Shelley appealed up to the Supreme Court. Raciall

10. Life tenant
One holding a life estate
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.
The transfer of a title by deed requires the grantor to deliver and the grantee to accept a given deed.
In a closing statement - money to be recieved or credit given for money or an obligation given.

11. Balloon payment
Pledging property as security for the payment of a debt without giving up possession.
A phrase inserted into a contract declaring that each deadline in a contract must be met as it occurs
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 agreement that has been fully performed.

12. Buyer's contract
Cash sales - New financing
A leasehold estate of definite duration
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 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

13. Guaranteed Loan Program
Supreme Court decision upholding Civil Right Act of 1866; under no circumstances is anyone exempted from the law prohibiting racial discrimination
Should an individual borrower default on a loan - the Rural Housing Service will pay the private financier for the loan
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.
An interest in real estate such that a court will take notice and protect the owner's rights.

14. Constructive condition
(a) Recipient of a gift of personal property by will. (b) Lender in a deed of trust.
In a closing statement - an expense or money received against a credit
A leasehold estate that automatically renews itself for consecutive periods until terminated by notice by either party; also called estate from period to period or periodic tenancy
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)

15. Secondary mortgage market
Transfer of legal rights and obligations by one party to another
A nickname for the Government National Mortgage Association (GNCMA) - a U. /S. government agency that purchaes FHA and VA mortgages.
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 market in which lenders sell mortgages

16. Trade fixtures
The portion of a deed that contains the grantor's and witnesses' signatures and the acknowledgment (notary).
An implied agency without an agency agreement
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.
Item that is installed by a comercial tenant and is removable upon termination of the tenancy

17. Revenue stamps
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
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 person appointedby an agent to assist in performing some or all of the tasks of the agency
A report - based on a title examination - setting forth the examiner's opinion of the quality of a title to real property.

18. Personal property
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 that has become real property by having been permanently attached to real property
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.
All property that is not land and is not permanently attached to land; everything that is movable; chattel.

19. Fraud
A mortgage given by the seller to the buyer to cover all or part of the sale price. Seller financing.
An intentional false statement of a material fact.
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
Those processed on uniform loan forms and according to FNMA/FHLMC guidlines

20. Leverage

21. Implied contract
A commission not based on a percentage of the selling price.
A concept allowing that oral explanations can support the wrtten words of contract but cannot contradict them.
One crated by deduction from the conduct of the parties rather than from the direct words of the parties; opposite of an express contract.
The transfer of a title by deed requires the grantor to deliver and the grantee to accept a given deed.

22. Unilateral contract
A licensee involved in a real estate transacton without having a relationship with the buyer or the seller
The duty of agents not to disclose any information about their clients.
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)
(a) A false statement or omission of a material fact. (b) In real estate - making an unintentionally false statement to induce someone to contract.

23. Agency disclosure

24. vendor's affidavit
Document signed under oath by vendor stating that vendor has not encumbered title to real estate without full disclosure to vendee.
One to whom contractual rights are transferred
Personal property that has become real property by having been permanently attached to real property
The U. S. agency that insures mortgage loans to protect lending institutions.

25. Special agent
The amount of the brokerage's commission that goes to the realtor
One that is free from reasonable doubt and that a court would require a purchaser to accept
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.
Agent with limited authority to act on behalf of the principal - such as created by a listing (realtors acting for realtors???)

26. Blanket mortgage
An act or event that must exist or occur before a duty of immediate performance of a promise arises. (relative to contracts)
One in which two more parcels of real property are pledged to secure payment of the note
A payment for insurance to protect the lender and/or insurer against loss if default occurs.
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.

27. Puffing

28. Misrepresentation
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.
Expenses seller owes on the day of closing but for which the buyer will take responsibility (such as property taxes)
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.
(a) A false statement or omission of a material fact. (b) In real estate - making an unintentionally false statement to induce someone to contract.

29. Referral Fees
A fee paid by a realtor to a brokerage out of the area for a buyer listing
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 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
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.

30. Retainer
A fee paid to an agent in advance for representation instead of commission; usually if commission exceeds retainer - a refund would be issued.
One in which the interest rate changes according to changes in a predetermined index.
1. Specific performance - 2. Rescission - 3. Compensatory Damages 4. Liquidated Damages
The amount of the brokerage's commission that goes to the realtor

31. underwriting

32. Metes and bounds
.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) One in which two or more lenders share in making the loan. (b) One in which a lender shares in the profit produced by an income property pledged to secure the loan payment in addition to receiving interest and principal payments.
E.g. very accurate desc or property)
Organization established in 1929 by license law officials on the state commissions to assist one another in creating - administering - and enforcing license laws.

33. Habendum clause
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
An exaggeration of a property's benefits.
One that requires the mortgagor to pay interest only during the mortgage term - with the principal due at the end of the term.
The statement in a deed beginning with the words "to have and to hold" and describing the estate granted

34. Vendee
A fee paid to an agent in advance for representation instead of commission; usually if commission exceeds retainer - a refund would be issued.
An agreement that has not been fully performed.
A court judgment obtained by a mortgagee for the amount of money a foreclosure sale proceeds were deficient in fully satisfying the mortgage debt.
Purchaser

35. Mortgage assumption

36. Valuable consideration
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
One that has no participation by an agency of the federal government - Can be ether uninsured or insured
Anything of value agreed upon by parties to a contract. Includes a promise.
Describes a buyer who is ready to buy - willing to buy - and financially able to pay the asking price.

37. Duty of disclosure
An east-west line in the rectangular method of property description
A responsibility for revealing all information that affects the agency agreement
Those processed on uniform loan forms and according to FNMA/FHLMC guidlines
Leaseholds; estates with a length determined by agreement or statute; establishes possession of land as oppposed to ownership in fee.

38. Deed in lieu of foreclosure
One that has no participation by an agency of the federal government - Can be ether uninsured or insured
A leasehold estate that automatically renews itself for consecutive periods until terminated by notice by either party; also called estate from period to period or periodic tenancy
Conveyance of title to the mortgagor in default to avoid a record of foreclosure. Also called friendly foreclosure
Neighborhoods that are made up of similar properties

39. Mutual mistake
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)
Time - title - interest - and possession; concurrent ownerships require at least one unity between co-owners.
A form of co-ownership lmited to husband and wife; does not include the right of survivorship
An error of material fact by both parties

40. Descent
The inability of a party to exercise his or her free will because of fear of another party.
The lender in a mortgage loan - who receives a mortgage from the borrower (mortgagor).
The distribution of property to legally qualified heirs of one who has died intestate
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

41. Deed
A written instrument transferring an interest in real property when delivered to the grantee.
Founded on natural duty and affection. Has no pecuniary value.
Permanence of land--makes it an attractive long term investment
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.

42. Police power
The principal in a real estate transaction
The power of government to regulate the use of real property for the benefit of the public
A test of soil to determine if it is sufficiently porous for installation of a septic tank.
Any act or event that - if it occurs or fails to occur - automatically creates or extinguishes a legal obligation.

43. Commission Paid to Sales Associates

44. Bundle of rights
The rights of an owner of a freehold estate to possession - enjoyment - control - and disposition of real 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.
Subject to being defeated by the occurrence of a certain event
The U. S. agency that insures mortgage loans to protect lending institutions.

45. Indestructibility
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.
Condominium unit composed of only vacant land with surface improvements or with air space within which a building is to be constructed.
A law in effect in all states requiring certain contracts to be in writing to be valid.
Permanence of land--makes it an attractive long term investment

46. Purchase Money Mortgage
An accurate legal description of land
A mortgage given by the seller to the buyer to cover all or part of the sale price. Seller financing.
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.
Provides financng for rural Americans with incomes below 80 percent of the median income level in the community where they live.

47. Multiple listing service (MLS)
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
Paid to Cooperating Brokers Usually 50%/50%
An organized method of sharing or pooling listings by member brokers. (electronic)
Founded on natural duty and affection. Has no pecuniary value.

48. Offer and acceptance
Permission to assume the mortgage at an interest rate prevailing at the time of assumption
Necessary elements for the creation of a contract.
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
Consummation of a real estate contract; also called closing.

49. Bilateral contract
The recipient of a gift of real property by will
An agreement based on mutual promises that provide the consideration. (A "done deal" both parties have fulfilled promises)
Neighborhoods that are made up of similar properties
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

50. Devisee
The inability of a party to exercise his or her free will because of fear of another party.
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
The power of government to regulate the use of real property for the benefit of the public
The recipient of a gift of real property by will