Real estate

fixtures?

starts as personal property but become real prop. once they are attached .

court often uses the MARIA test

trade fixtures

are installed by a commercial tenant for business purposes and are considered personal property — not real property.

• business only

freehold estate

you own the property and your ownership lasts for indefinite period of time

• with freehold you own until u sell, heirs, or foreclosure so there is no expiration date on ur ownership

All fee simples are freehold estates, but not all freehold estates are fee simple absolute.

• Freehold = you own the property (indefinitely)

• Fee simple absolute = you own it completely, forever, without conditions

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leasehold estate

possession but not ownership

you rent/lease the prop. for a fixed period

what is a contingency

a condition that must be met for the contract to move forward , seller or buyer may have the right to cancel contact without penalty

breach

a failure to perform the duties or obligations required by the contract

youre serious about buying a home so you put

Earnest funds aka good faith deposit

A buyer has an inspection contingency. The inspector finds major foundation problems, and the buyer cancels the contract within the contingency period and follows the proper notice procedure. The seller is upset and wants to keep the earnest money because the home was off the market. the one entitled to the earnest Monety? the buyer bc the cancellation was protected by a contingency so th

FHA loans?

loans designed to help those who may have a low credit score, smaller downpayment as low as 3.5,

so since the gov is basically taking a risk the borrower must pay MIP

There are two kinds:

1⃣ Up-Front MIP (UFMIP) — paid at closing (can be financed into the loan)
2⃣ Annual MIP — added to the monthly payment

For many borrowers, the MIP lasts for the life of the loan unless they refinance into a conventional loan.

FHA Loans are NOT for investments purchases

purchase agreement

the contract between the buyer and seller, it spells out the price , closing date, what stays w the house, and any condition that have to be met, both sides sign and you're legally bound — unless a contingency gives you an exit.

tenancy in common

lets two or more ppl own property together w separate shares, if one person dies the heir gets the part no automctaiclly the other owner.

amortization

At the beginning of an amortized loan, which portion of the monthly payment is largest?

A. Principal
B. Interest
C. Taxes
D. Insurance

gradual loan payoff through equal payments

so it has equal Montly payments that gradually pay off principle and interest until the loan balance reaches zero

b.intrest

buyers market

market condition that exists when homes for sale outnumber buyers. Homes can sit on the market for a Long time and prices tend to drop

DOM

days on the market

deed

the legal document that establishes ownership of real prop. also used to transfer the ownership of real property to another person or entity

a security deposit made by the buyer to assure the seller of his or her intent to purchase ?

earnest money

in escrow

a period of time (typically 30 days or more) after a buyer has made an offer on a home and a seller has accepted. During this time, the home is inspected and appraised, and the title searched for liens, etc.

loan estimate

3 page document sent to an applicant three days after they apply for a home loan. the document includes loan terms, monthly payments and closing costs. a loan estimate can help borrowers shop and compare costs of loans w lenders. you are not obligated to a loan estimate. smart ppl will though to determine which is best

MLS

a database where the RE agent list properties for sale

pre- approval. letter

A thorough assemesnet of a borrower’s income, assets, and other data to determine a loan amount they would qualify for. A Real estate agent will request a pre approval or pre- qualification letter before showing a buyer a home.

property tax exemption

a reduction in taxes based on specific criteria, such as uninstallation of a renewable energy system or rehabilitation of historic home. ee

refinancing

replacing an old loan with a new loan

You owe $300,000 on a house at 7% interest.
Rates drop to 5%.
You refinance → new loan at 5% → old loan is paid off, new one starts.

market condition where the buyers outnumber the homes on sales. prices are often higher than aevare

sellers market

short sale

someone bought a house

they owe the bank more money than the house Is worth

they can’t afford the payments anymore

so they ask the bank “ can I sell the house for what its worth, even though its less than I owe you”

if bank says yes= then its a short sale

• ou owe the bank $400,000

• Your house is only worth $300,000

• You find a buyer for $300,000

• The bank agrees to accept $300,000 and take the loss

• Short sale

  • Owner sells the house

  • Bank must approve

  • Less damage to credit than foreclosure

  • Takes a long time

  Foreclosure

  • Bank takes the house

  • Owner loses it

  • More damage to credit

tax lien

the gov legal claim against property when the homeowner neglects or fails to pay a tax debt

what is zoning

system of land use regulations that controls how land can be used and regulated

comps

homes in a given area that have sold within the past several months that a real estate agent used to determine a home’s value.

conditions written into a home purchase contract that protect the buyer should issues arise

contingencies

the money you make before taxes and decoctions

gross income

money you take u take home after deductions

net income

so you buy a duplex for 800,000 and then years later it’s worth 1m, then u wanna sell, You will not get taxed on the 800,000 but Only on the profit you made

1031 exchange

If you, as the investor, buy a property to rent out, flip for profit, or use in a business, that qualifies.

QI

capital gains

• 45 days to identify replacement property

• 180 days to complete the purchase

remaining amount of money u still owe on the loan so basically what’s left to pay is ???

mortgage balance

assumable mortgage

• The buyers takes over the sellers remaining loan and the buyer pays the seller money ofc.

• Home value: $500,000

• Mortgage balance: $300,000 at 3%

• Buyer assumes $300,000 loan

• Buyer pays seller $200,000 for equity

In short:

but U U CANT DO THIS if someone has a conventional mortage-

FHA, VA, and USDA loans are assumable, often making them attractive to buyers.

ARM

type of home loan where the interest rate changes over time instead of staying fixed

goof 4 ppl who refinance or plan to sell

fixed rate morgathe

when the interest rate stays the same for the entire loan term

Addendum

think of this like adding new conditions , an extra document added to a contract that changes or adds terms without changing the WHOLE contract

lease

a contract that transfers possession from an owner to a tenant

owner is - lessor

tenant- lessee

wat does the statue of frauds say

says that certain contracts are only valid if they are written and signed . one of those is any contract that cannot be possibly be completed within one year.

so for leases: •

A 6-month lease → can be oral (because it ends within a year)
• A 1-year lease → can be oral (because it ends within a year)
• A 2-year lease → must be in writing
• A 5-year lease → must be in writing

a lease with definite beginning and a definite ending date, it automatically ends when the time is up , no notice is required.

estate for years

• btw if the tenant stays w/out permission it becomes tenancy at sufferance

airbnb rentals are considered residential Real estate, T/ F

True

A single-family home used as a short-term Airbnb is classified as

resindteal real estate

deeds : two types

grant types:

what kind of ownership is being transferred

fee simple absolute - full onwe4rship

life estate

leasehold estate - right of possession not ownership.

qualification type

thisnte im lost

tenancy at will

no definite term

can be needed bye either party

often created orally t

in fee simple absolute,

does not end If the owner dies= goes to heir or will

When a government agency or a private entity needs land for public use, they access private land through

eminent domain