Key Concepts to Pass Your Real Estate Exam

A collection of key concepts and terms to help you prepare for your real estate exam.

A __________ is a personal privilege to use the land of another.

license

The -or suffix is used for the person who performs an action, while the -ee suffix is for the __________ of that action.

recipient

The rights to use, give away, sell, and lease property are known as the __________ of rights.

bundle

Real property incorporates all things attached to the land, while personal property includes __________ items.

movable

A __________ is personal property that becomes real property when attached.

fixture

An __________ refers to what belongs to and goes with something else in real estate.

appurtenance

An __________ is when a structure intrudes onto another person’s land.

encroachment

Crops grown on rented land are known as __________ and belong to the tenant.

emblements

In real estate, __________ power is the state's right to regulate property for the health and safety of the community.

police

The term used when the government takes private property for public use is called __________.

eminent domain

A __________ estate lasts for the lifetime of a person.

life

The __________ is the maximum value of a property, usually the price of a similar property with the same use and design.

principle of substitution

__________ is the process where a property owner has the right to use water from a river, stream, or creek.

Riparian rights

A __________ lease means the tenant has rights over the landlord to terminate the lease without notice.

periodic tenancy

In an __________, a mortgage loan can stay in the seller’s name while the buyer controls the property.

subject to mortgage

__________ refers to a lease where the tenant pays a fixed amount to the landlord while the landlord covers other costs.

gross lease

A __________ mortgage allows the borrower to make additional payments without penalties.

open mortgage

A 'contract for deed' is also known as a __________ contract in real estate.

land

The __________ is the interest rate that includes one-time fees and is used to compare lenders.

annual percentage rate (APR)

The __________ theory states that the lender has a lien interest in the property and may foreclose if the borrower defaults.

lien

The __________ of the mortgage agreement creates a legal obligation for both the lender and borrower.

note

The __________ Act protects consumers in credit transactions by requiring clear disclosures.

Truth in Lending