Real Estate License Exam Preparation - Vocabulary Study Deck

Comprehensive vocabulary flashcards covering the uniform and state portions of the Real Estate License Exam Preparation Manual.

Supply

The total amount of a specific good or service available to consumers.

Demand

The quantity of a good or service that consumers are willing and able to purchase at various prices.

Market Equilibrium

The point where supply equals demand, leading to stable prices.

Land

The earth's surface extending downward to the center of the earth and upward to infinity, including everything attached naturally.

Real Estate

Land plus all human-made improvements to the land.

Real Property

Land and improvements plus the bundle of legal rights associated with ownership.

Riparian Rights

Water rights pertaining to landowners whose property borders a river or stream, allowing reasonable use of the water.

Littoral Rights

Water rights pertaining to landowners whose property borders a lake, sea, or ocean, allowing use of the water up to the high-water mark.

Personal Property

Movable items that are not permanently affixed to or part of the real estate.

Fixtures

Items that were initially personal property but have become permanently attached to and part of the real estate.

Trade Fixtures

Items installed by a tenant for business use (such as restaurant equipment) that remain personal property and are removable before the lease ends.

Fee Simple

The highest interest in real estate recognized by law, representing complete ownership.

Life Estate

A freehold interest in real property where ownership is limited to the duration of someone's life.

Fee Simple Determinable

A defeasible fee estate where ownership automatically terminates and reverts to the grantor if a specified condition is violated.

Fee Simple Subject to Condition Subsequent

A defeasible fee estate where ownership may be terminated by the grantor if a specified condition is violated, requiring legal action by the grantor.

Dominant Tenement

The parcel of real property that benefits from an appurtenant easement.

Servient Tenement

The tract of land over which an easement runs and which is burdened by the easement.

License

A personal, revocable, and temporary privilege or permission to enter and use another individual's land for a specific purpose.

Encroachment

The unauthorized physical intrusion of a building or improvement onto another person's land.

Lis Pendens

A recorded legal notice indicating that a lawsuit is pending that affects the title to a specific parcel of real property.

Eminent Domain

The constitutional right or power of the government to take private property for public use upon the payment of just compensation.

Condemnation

The legal judicial or administrative proceeding through which the government exercises its power of eminent domain.

Escheat

The reversion of property ownership back to the state when an individual dies intestate without any discoverable heirs.

Ownership in Severalty

Exclusive sole ownership of real property by a single individual or legal entity.

Tenancy in Common

A form of co-ownership where each owner holds an undivided interest with no right of survivorship, allowing the interest to pass to heirs upon death.

Joint Tenancy

A form of co-ownership requiring the four unities (time, title, interest, and possession) that includes the right of survivorship among co-owners.

Community Property

A system of property ownership for married couples where property acquired during marriage is owned jointly and equally by both spouses.

Cooperative

A multi-unit property ownership arrangement where a corporation holds title to the building and land, and occupants purchase shares to receive proprietary leases.

Point of Beginning (POB)

The designated starting and ending point in a metes-and-bounds legal description.

Township

A primary unit of the rectangular survey system measuring $6\text{ miles}$ by $6\text{ miles}$, encompassing $36\text{ square miles}$.

Section

A subdivision of a township measuring $1\text{ mile}$ by $1\text{ mile}$, containing $1\text{ square mile}$ or $640\text{ acres}$.

Benchmark

A permanent reference mark or physical marker placed by surveyors to establish elevations above a datum.

Title

The legal right to ownership of land, as well as the evidence confirming that ownership.

Adverse Possession

The involuntary acquisition of title to real property by continuously, openly, notoriously, exclusively, and hostilely occupying it for a statutory duration.

Warranty Deed

A conveyance instrument wherein the grantor guarantees clear title and agrees to defend the title against all claims.

Quitclaim Deed

A conveyance deed that transfers whatever interest, title, or right the grantor has in the property without warranties or covenants.

Constructive Notice

The legal presumption that a party has notice of information because it is properly recorded in public records.

Subordination

A legal agreement that intentionally alters the priority of claims, placing one lien below another.

Subrogation

The substitution of one party in place of another with respect to a lawful claim, demand, or right, often used by title insurance companies to recover losses.

Quiet Title Action

A court action or lawsuit brought to remove a cloud on title and legally establish clear ownership.

Non-Conforming Use

A land use that was legally established prior to the adoption of current zoning laws but is permitted to continue (grandfathered) despite not meeting current codes.

Variance

An authorized exception or permission granted by an administrative body allowing a property owner to deviate from strict zoning requirements due to hardship.

Exclusive Right to Sell Listing

An employment agreement giving a single broker the sole authority to market property and guaranteeing a commission regardless of who procures the buyer.

Exclusive Agency Listing

A listing agreement authorizing one broker to sell the property, while allowing the owner the right to sell independently without paying a commission.

Net Listing

A listing contract where the owner sets an acceptable net sales price and the broker takes whatever amount the property sells for in excess of that figure.

Estate for Years

A leasehold estate that continues for a specified, predetermined period and terminates automatically without notice.

Periodic Estate

A leasehold agreement that continues for successive periods (such as month-to-month) until proper notice of termination is given by either party.

Estate at Sufferance

A tenancy created when a tenant remains in possession of leased property after the lease expiration without the landlord's consent.

Actual Eviction

The legal proceeding through which a landlord regains physical possession of real estate by judicial process following a tenant breach.

Constructive Eviction

A situation where a tenant is forced to vacate because a landlord's actions or failures render the premises uninhabitable, terminating the lease.

Procuring Cause

The uninterrupted series of causal events that leads directly to the successful conclusion of a real estate transaction.

Blockbusting

The illegal practice of inducing owners to sell property by suggesting that the racial or demographic character of the neighborhood is shifting.

Steering

The illegal practice of channeling homeseekers toward or away from specific neighborhoods based on race or membership in a protected class.

Redlining

The unlawful practice by lending or insurance institutions of refusing mortgages or policies in specific areas based on economic or racial composition.

Novation

The substitution of a new contract or party in place of an existing one, completely releasing the original party from liability.

Liquidated Damages

A predetermined sum of money stipulated in a contract that serves as compensation to the injured party upon a default or breach.

Acceleration Clause

A provision in a promissory note or mortgage enabling the lender to demand the entire unpaid loan balance immediately due upon borrower default.

Alienation Clause

A clause (also known as a due-on-sale clause) enabling the lender to declare the complete mortgage balance due immediately upon sale or transfer.

Discount Points

Prepaid interest charged by a lender at closing to lower the borrower's interest rate, with each point costing $1\%$ of the loan amount.

Loan-to-Value (LTV) Ratio

The mathematical relationship between the loan balance and the appraised value or sales price of the mortgaged property.

Commingling

The illegal professional practice of mixing a client's trust funds with a real estate licensee's personal or business operating funds.

Conversion

The illegal act of appropriating, taking, or spending client trust funds for personal or business expenses.