NYS Real Estate - Key Points

P9 The purpose of license laws is to:

minimize fraudulent practice within the real estate industry

P16 An attorney sponsoring licensed real estate salespersons must have a

valid Real Estate Broker License

P19 Photo ID card must be

shown on demand

P27 If an agent cannot get a commission. He should seek a recovery from

his own principal broker

P27 Blind advertisement

An advertisement without a brokerage firm's name or phone number

P32 Commingling

A misdemeanor by mixing the funds of others with your own, Brokers must deposit money i an escrow/trust account within 3 days.

P32 Conversion

Using someone else's property or funds without permission for personal gain.

P34 Violation of Article 12-A 15:

guilty of misdemeanor. Punishable by a fine of up to $1,000 and/or imprisonment for up to one year

P35 Property condition disclosure should be provided to the buyer or the buyer's agent

before the seller accepts the purchase offer

P33 An agent is a:

fiduciary

P48 A principal is also known as a

client

P51 Special agent

hired to perform one specific duty for a client.

P51 General agent

can perform any and all acts associated with the principal's ongoing business the agent has been appointed to act.

P62 Dual agency

A single real estate agent or brokerage represents both the buyer and the seller in the same transaction. Illegal in NY unless both parties consent to it and Dual Agency Affidavit is submitted.

P59 Buyer Agent

If the agent is hired/works for the buyer. Locates a property and negotiates for the buyer.

P59 Single agent

If the agent is hired by one party.

P76 The exclusive right to sell agreement

The seller appoints one agent entitled to the commission regardless of who finds the buyer.

P76 The exclusive agency agreement

The seller grants exclusivity to one real estate agent or brokerage to sell the property, but reserves the right to sell the property themselves without paying a commission.

Mortgagor is

a.k.a borrower

P32 Net listing

The seller specifies a net amount of money he wants to receive upon sale of his property. Considered illegal in NY State.

P83 When should we show the agency disclosure form?

At the first substantive contact

P93 Declaration Form

Document used to declare or disclose certain information about a property or a transaction.

P96 Independent contractor

Real estate salespersons and associate brokers are often classified as independent contractors rather than employees.

P96 Sales associates should pay their own

social security & income taxes

P100 A real estate salesperson works as an employee should NOT file

Schedule C to the federal income tax Form 1040

P115 Trade Fixture

A fixture for the purpose of conducting business operations. Personal property and can be removed by the tenant or business owner

P120 Life estate is

ownership, possession, and control for someone's life time upon living and are lost at death

P126 Tenancy by the entirety is limited to

the spouses

P131 Property tax is considered as

Specific lien

P135 Easement

A legal right that allows one party to use the land or property of another party for a specific purpose.

P139 Encroachment

One property owner violating their neighbor's rights by building or extending some feature of their property that crosses over property lines onto their neighbor's property.

P153 Who must execute the deed?

The grantor

P156 Warranty deed provides

the greatest protection to the grantee

P168 Abstract of title is a

condensed history of the title includes a survey & summarizes every related document in chronological orals

P168 Chain of title

The complete history of ownership transfers and other recorded interests affecting a particular property.

P170 Final walk through

The last inspection conducted by a property buyer before the closing or settlement takes place. Typically scheduled a few days before the closing.

P186 Proration

The method of dividing certain expenses or income items between the buyer and the seller in a property transaction, based on the period of ownership during the closing process.

P225 Installment land contract is also called

Contract for deed

P224 Time is of the essence

A legal phrase commonly used in contracts which means that the parties involved must perform their obligations within the specified timeframe

P207 Actual eviction

Legal process by which a landlord or property owner removes a tenant from leased premises due to a breach of the lease agreement or other legal grounds.

P206 In a sublease contract, who is still responsible to the landlord for the rent?

The original lessee

P212 Void contract

If the purpose of the contract is illegal.

P234 Who holds the down payment?

Seller's attorney

P235 Who signs the contract of sales first?

The purchaser (buyer)

P250 Mortgagee

The lender

Mortgagor

The borrower

P185 Discount point

Each point that the lender charges costs 1% of the loan amount.

P259 Amortized mortgage

A loan where regular payments cover the principal and interest, gradually reducing the balance until it's fully repaid.

P261 Graduated payment mortgage

initial mortgage payments start out small, and then increase over time as borrower start to build up more money.

P263 Bridge loan

A short-term loan used to bridge a financial gap between the purchase of a new property and the sale of an existing property or another form of financing becoming available.

P290 Mortgage banker's and Mortgage broker's licenses are registered by

New York State Department of FInancial Services (NYSDFS).

P264 Shared Equity Loan

The homeowner retains ownership while a lender or investor contributes funds in exchange for a share of the property's future appreciation.

P264 Construction mortgage

A short-term loan used to finance the construction of a new building or renovation of an existing property. It provides funds in stages or "draws" as construction progresses

P274 Regulation Z: requires disclosure of buyer's

finance charge and includes down payment

P301 Nonconforming loan / Jumbo loan

Mortgage loans that exceed the loan limit. May have stricter credit and income requirements than conforming loans and often carry higher interest rates to compensate for the increased risk to lenders.

P565 Debt service

Monthly payment of mortgage principal and interest payments.

P332 Eminent domain

When the government takes private property with compensation.

P332 Police Power

If the government takes private property without compensation.

P330 Certificate of occupancy

After construction, we need a Certificate of Occupancy.

P330 Building permits

Before construction, we need a Building Permit.

P332 The actual taking of private property under eminent domain is called

condemnation

P333 Escheat

The legal process by which property or assets revert to the state or government when an individual dies without a will (intestate) and has no heirs to inherit the property.

Planning Board/City Planning Commission (CPC)

In charge of designing (implementing/ mapping) a master plan (blueprint in construction terms), aka a Comprehensive Plan.

Zoning Board of Appeals

Responsible for reviewing and deciding on appeals related to zoning regulations and land use decisions, as well as review master plan.

P342 A Permission to use the land or house for a purpose prohibited by the current zoning restriction is called

Variance

P342 Property owners who needs a variance must apply to

the local Zoning Board of Appeals

P340 Creating a community's comprehensive plan is one of the functions of a

planning board

P366 Tax assessor

Determines property values for tax purposes on behalf of the government.

P373 Department of Health (DOH) reviews and approves site and

waste-water treatment system

P368 Blueprint / /Building Plans

A graphical representation of what a building will look like after construction. They are used by builders and contractors to construct buildings of all kinds

Sill plate

is the first wooden member of the structure and is used as the nailing surface for the floor & ceiling systems

Studs

are used vertically for wall construction.

Joist

wooden framing members for floor & ceiling framing.

Girder

A steel beam or several wooden members fastened together the spans the distance from one side of the foundation wall to the other.

R-value / R-factor

Measure of thermal resistance, or how well a material resists the flow of heat

P387 Forced warm air system

The most commonly used heating system in New York | Keyword: Furnace, Blower or fan, duct

P389 A measure of heating rating is

British Thermal Unit (BTU)

P404 Lead

It is a toxic, heavy metal that is denser than most common materials. Houses built prior to 01-01-78 may have this element.

P402 Asbestos

Used as an insulator between the walls and floor. Since 1988, this has been strictly prohibited from use.

P410 Radon Gas

A radioactive, colorless, odorless gas from the breakdown of uranium in soil, rock, and water, found in homes across the U.S. Can cause lung cancer.

Possible Ways for radon gas to get into the house

1. Cracks in foundation walls or floors.
2. Gaps around pipes and cables entering the home.
3. Gaps in suspended floors.
4. Gaps around windows and doors.
5. Construction joints.
6. Well water, maybe.

P416 Environmental Impact Statement (EIS)

A document required for actions significantly affecting the environment.

It informs decision-makers and the public about the potential environmental consequences of a proposed project before a decision is made.

P419 Chlorofluorocarbon (CFCs)

Freon, Ozone layer depletion; they were primarily used in refrigeration, air conditioning, aerosol propellants, and foam-blowing agents for insulation and packaging

P432 Value in use

Value of the property based on its specific utility or usefulness to its current owner or user. Subjective

P435 CMA (Comparative Market Analysis) can never be referred to as

an appraisal. It can be prepared by anybody.

P436 The amount a buyer agrees to pay and a seller agrees to accept is which of the following value?

Market Price

P446 Wear and tear resulting from gradual exhaustion of use is called

deterioration

P446 CMA Form

Can be prepared by anybody.

It's a document used to assess and estimate the market value of a property by comparing it to similar properties that have recently sold in the same area.

P459 Disabilities and familial status became protected classes in

1988

P470 NYS Human Right law and Federal law do not cover

lawful occupation

P468 Steering

The illegal practice of directing or guiding potential buyers or tenants toward or away from certain neighborhoods or properties based on their race or other protected characteristics.

P468 Blockbusting

Agents or other parties encourage homeowners to sell their properties quickly and at a lower price by creating fear or alarm about an impending change in the neighborhood's demographic composition. Illegal!

P468 Redlining

Refuse to make loans for discrimination in Race, color, religion, or national origin.

P482 What insurance covers bodily injury or property damage?

Liability insurance

P484 Perils

Damages caused by people or mother nature.

P485 Tenants or cooperative owner policies (HO-4). This policy is:

the landlord's responsibility

HO-3: Special Form

Open Perils form. It provides coverage for the structure of your home against all perils, except those that are specifically listed as excluded.

HO-6: Unit-owners Form

Designed for condominium owners, it provides property coverage for any alterations to appliances, fixtures, and improvements within the insured unit.

P489 What does FEMA do?

it administers the national flood insurance program

P490 Windstorm deductibles

According to NY Insurance Law Section 3445 requires that insurers provide proper disclosure to the insured