Maryland and National Real Estate Exam Prep

Comprehensive flashcards covering Maryland-specific real estate commission rules, licensing requirements, business conduct, and national property ownership and financing principles.

What are the four components of the ACTOR acronym for risk management?

Avoid, Control, Transfer, Or Retain

What are the duties owed to a client under the acronym COLDAC?

Care, Obedience, Loyalty, Disclosure, Accounting, and Confidentiality

What four economic characteristics define the value of land (DUST)?

Demand, Utility, Scarcity, and Transferability

What are the four powers of government regarding land use (PETE)?

Police powers, Eminent domain, Taxation, and Escheat

How long are the staggered terms for members of the Maryland Real Estate Commission (MREC)?

$4$ years

What is the composition of the Maryland Real Estate Commission?

Nine members: five licensees and four consumers

What is the minimum experience requirement for a licensee to be appointed to the MREC?

Actively licensed for $10$ years preceding appointment

Which body hears appeals for final orders of the Maryland Real Estate Commission?

The Circuit Court

What is the maximum fine for a first violation of Maryland real estate law?

$5,000$ dollars

What is the minimum required balance of the Maryland Real Estate Guaranty Fund?

$250,000$ dollars

What is the maximum payment allowed on a single claim from the Guaranty Fund?

$50,000$ dollars

What interest rate must a licensee pay when reimbursing the Guaranty Fund for a paid claim?

$12\%$ interest

How many hours of pre-licensing education are required for a Maryland Salesperson license?

$60$ hours

How many hours of pre-licensing education are required for a Maryland Associate Broker license?

$135$ hours

Within what timeframe must a candidate take the licensing exam after completing the pre-licensing course?

Within $1$ year

How often must Maryland real estate licenses be renewed?

Every $2$ years

How many hours of continuing education (CE) are required for Salespersons and Associate Brokers in Maryland?

$15$ hours

According to the transcript, salespersons and associate brokers together cannot own more than what percentage of a real estate company?

$$50\%$$

For an independent contractor, at least what percentage of income must come from real estate transactions according to Maryland law?

$$90\%$$

For how long must a licensee keep copies of signed documents?

$5$ years from the date of last activity

Within how many days must an earnest money deposit be deposited in a Maryland bank after ratification?

$7$ business days

Which protected class was specifically added by the Maryland Real Estate Commission for its licensees?

Creed

Which federal law prohibits discrimination based on race with no exceptions?

Civil Rights Act of $1866$

What are the three physical characteristics of land?

Indestructability, Immobility, and Non-homogeneity (uniqueness)

What are the four tests for determining if an item is a fixture?

Agreement between the parties, parties' intention, method attached, and adaptation of item

What is the process called when the government exercises the right of Eminent Domain?

Condemnation

What is the definition of Market Value?

The most probable price a person would pay in an arms-length transaction

Residential properties valued at or below what amount are exempt from needing a formal appraisal by a licensed appraiser in federally-related transactions?

$250,000$ dollars

What is the difference between a Blanket loan and a Wrap Around loan?

A Blanket loan covers more than one property, while a Wrap Around loan involves the owner holding secondary financing while the first loan stays in place

What does an Acceleration Clause do in a mortgage contract?

Speeds up payment of the entire loan, also called a Due On Sale Clause

What is the age requirement to be eligible for a Reverse Annuity Mortgage?

Persons age $62+$

What is a 'Net Listing' and what is its legal status?

An agreement where the seller wants a certain net amount and the broker keeps the excess; it is illegal

What is the difference between an Addendum and an Amendment in a contract?

An Addendum is an addition to the offer; an Amendment is a change to the contract

What is the definition of an 'Estate at Sufferance'?

A hold-over tenant where the lease has expired but the tenant did not vacate

Which type of deed provides the most protection to the buyer?

General Warranty Deed

What are the five covenants of a General Warranty Deed?

Seisin, Quiet Enjoyment, Encumbrances, Further Assurance, and Warranty Forever

What is the tax threshold for capital gains exclusion for a married couple filing jointly who has lived in the property for two of the last five years?

$500,000$ dollars

What is the 'back-end ratio' for lending calculations cited in the notes?

$$36\%$$