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TN Exam Prep
Tennessee Real Estate Exam Prep
| Question | Answer |
|---|---|
| The Consumption of available vacant property in a building or market. | Absorption |
| A written, chronological record of the title records affecting rights and interests in a parcel of real property. | abstract of title |
| A right granted through a loan clause enabling the lender to call all sums immediately due and payable on a loan should the borrower violate certain provisions of the loan agreement. | acceleration |
| An increase in land caused by natural phenomena, for example a deposit of sand on a beachfront property due to a tropical storm. | accretion |
| Knowledge given or received directly through demonstrable evidence. Actual notice of ownership: reading a bill of sale, inspecting a deed, searching title records. | actual notice (see also constructive notice) |
| A mortgage loan having an interest rate that can be periodically raised or lowered in accordance with the movement of a financial index. | adjustable rate mortgage |
| The beginning basis, or cost, of a property plus the costs of capital improvements, minus all depreciation expense. | adjusted basis |
| A real property's annual tax levied by taxing entities according to the property's assessed value. | ad valorem tax |
| The entry, occupation, and use of another's property without the consent of the owner or where the owner took no action to evict the adverse possessor. May lead to loss of legal title if the adverse possessor fulfills certain requirement. | adverse possession |
| A fiduciary relationship between an agent and a principal where respective rights and duties are prescribed by laws of agency and by the agency agreement executed by two parties. | agency |
| The party in an agency relationship who is hired by the principal to perform certain duties. In so doing, the agent must also uphold fiduciary duties owed to the principal. | agent |
| Rights in real property as they apply to the property's airspace, or all space above the surface within the parcel's legal boundaries. | air rights |
| "A transfer of title to real property by voluntary or involuntary means. Voluntary- public grant, deed, will;Involuntary - descent, escheat, foreclosure, eminent domain, adverse possession, estoppel" | alienation |
| An act of collusion where two or more competitors agree to limit competitive activity in portions of the market in exchange for reciprocal restrictions from the others. | allocation of markets |
| A partial or complete reduction of a loan's principal balance over the loan term, achieved by periodic payment s which include principal as well as interest. | amortization |
| The total cost of credit to a borrower inclusive of finance charges and the state interest rate, expressed as an annual rate of interest. | annual percentage rate (APR) |
| Legislation aimed at preventing unfair trade practices and monopoly, including collusion, price fixing, and allocation of markets. | antitrust laws |
| An opinion of value of a property developed by a professional and disinterested third party and supported by data and evidence. | appraisal |
| a duly trained and licensed professional authorized to perform appraisals for other parties. | appraiser |
| An increase in the value of a property generally owing to the economic forces beyond the control of the owner. | appreciation |
| A right, interest, or improvement that attaches to and transfers with a parcel of real property, such as an easement or a riparian right. | appurtenance |
| Payment that occurs at the end of a payment term rather than at the beginning. Examples of items paid in arrears include taxes and interest. | arrears |
| A combining of contiguous parcels of real estate into a single tract, performed with the expectation that increase value will result. | assemblage |
| The value of a property as established by assessors for the purpose of ad valorem taxation. | assessed value |
| A periodic charge payable by condominium owners for the maintenance of the property's common elements. | assessment |
| A tangible or intangible item of value. | asset |
| A sale of a business involving the transfer of assets as opposed to the liabilities or stock. | asset sale |
| A transfer of one's entire interest in an item of real or personal property. The assignor transfers the interest to the assignee. | assignment |
| In a sale of real property, the transfer of the seller's mortgage loan obligations to the buyer. Requires, in most cases, approval of the leader. | assumption |
| A lump sum payment on any loan which retires the remaining loan balance in full. | balloon payment |
| An imaginary latitude line within the rectangular survey system that is designated in relation to a principal meridian for purposes of identifying townships. | base line |
| The original cost or market value of an acquired asset | beginning basis |
| A registered marker denoting an official elevation above sea level; used by surveyors to identify other elevations in the area. | benchmark |
| A party named to benefit from the yield or disposition of an asset identified in a trust, insurance policy, or will. | beneficiary |
| A contract where both parties promise to perform in exchange for performance by the other party. | bilateral contract |
| A temporary agreement to buy a property evidenced by a valuable deposit. Receipt of the deposit binds a seller to a good-faith agreement to sell a property, provided a complete sale contract is executed within a certain period. | binder |
| An advertisement that does not contain the identity of the advertiser. | blind ad |
| Inducing property owners to sell or rent their holdings due to an impending downturn in their property values, often owing to a change in the area's ethnic or social composition. | blockbusting |
| A direct agent of the principal who is hired for compensation to perform a stated service such as procuring a customer. | broker |
| An estimate of a property's value rendered by a party who is not necessarily licensed, objective, or qualified. The estimate may not be a complete appraisal. | broker's opinion of value |
| The business of procuring customers on behalf of clients for the purpose of completing a real estate transaction. | brokerage |
| The brokerage of a business enterprise in addition to any real property it may own or lease. | business brokerage |
| A specific standard of construction or maintenance of any aspect of an improved property established by local government officials. | building code |
| A set of rights associated with ownership of property, including the rights to possess, use, transfer, encumber and exclude. | bundle of rights |
| A loan arrangement where the borrower pays extra interesting advance for the future benefit of a lower interest rate over the loan term. | buydown |
| A broker's listing with a buyer to locate a suitable property for purchase of lease. | buyer representation agreement |
| A market characterized by an excess of sellers over buyers. | buyer's market |
| The difference between the net sales proceeds of an asset and its adjusted basis. | capital gain (or loss) |
| An upgrading of improved property having sufficient magnitude to constitute an addition to the property's basis. Contrasts with repair and maintenance. | capital improvement |
| The rate of return on capital an investor will demand from the investment property, or the rate of return that the property will actually produce. | capitalization rate |
| The remaining positive or negative amount of income an investment produces after subtracting all operating expenses and debt service from gross income. | cash flow |
| A document confirming that a newly constructed or renovated property has fully complied with all building codes and is ready for occupancy and use. | certificate of occupancy |
| A document expressing the opinion of a title officer or attorney that a property seller is in fact the owner of a good title based on a review of title records. | certificate of title |
| Successive property owners of record dating back to the original grant of title from the state to a private party. | chain of title |
| An item of personal property. | chattel |
| A meeting of principal parties where a seller transfers title and a buyer pays monies owed the seller and lender. | closing |
| An encumbrance or claim on title to property impeding or diminishing its marketability. | cloud |
| A brokerage practice where agents and brokers outside of the listing broker's agency assist as subagents in procuring a customer in exchange for portions of the commission. | co-brokerage |
| Property lined by a lender as security for a loan. | collateral |
| An unlawful agreement between competitors to monopolize a market, disadvantage other competitors, or otherwise undertake activities in violation of fair trade laws. | colllusion |
| A defective title transfer or the transfer of a defective title where the new owner is originally unaware of the defect. Color of title may be used as a grounds for adverse possession, which, if successful would nullify the original defect. | color of title |
| An unlawful practice of mixing escrow funds with the agency's operating funds. | commingling |
| Portions of a condominium property that are owned by all unit owners for example grounds, parking facilities, lobby and elevators. Portions of a commercial property used by all occupants as well as the public. | common elements |
| A body of law developed by court judgments, decrees, and case decision. | common law |
| Property acquired during the marriage with jointly held funds. | community property |
| A property having similar characteristics to a subject property in an appraisal. The value or sale price of the comparable is used to estimate the value of the subject. | comparable |
| A method used by brokers and sales people for estimating the current value of a property using sale price data from similar properties. Not to be confused with a bona fide appraisal performed by a licensed appraiser | comparative market analysis (CMA) |
| Planning policy that requires developers to correct foreseen negative impacts of a development during the construction period of the project for example, widening a road during construction to accommodate future increase in traffic. | concurrency |
| 1. A decree by a court or municipal authority that a parcel of private property is to be taken for public use under the power of eminent domain. 2. A government order that a particular property is no longer fit for use and must be demolished. | condemnation |
| An estate distinguished by fee simple ownership of the airspace of a unit plus an undivided interest with the other unit owners in the overall property's common elements. | condominium estate |
| An item of tangible or intangible value, or one's promise to do or not do some act which is used as an inducement to another party to enter into a contract. | consideration |
| Knowledge on could or should have, according to the presumption of law; a demonstration to the public of property ownership through title recordation, "for all to see." | constructive notice |
| A condition that must be satisfied for a contract to be binding and enforceable. | contingency |
| A potentially enforceable agreement between two or more parties who agree to perform or not perform some act. | Contract |
| A financial contract where a seller retains legal title to a property and gives the buyer equitable title and possession over a period of time. Seller finances all or part of the purchase price. | contract for deed |
| The increment of market value added to a property through the addition of a component for improvement to the property. Not to be confused with the cost of the component. | contribution |
| A permanent long-term loan that is not FHA-insured or VA-guaranteed. Ratios 28%; 36% - Hardest to get. | conventional loan |
| 1. Changing real property to personal property, and vice versa. 2. An illegal act of appropriating escrow funds for payment of an agency's operating expenses. | conversion |
| A voluntary transfer of real property interests | conveyance |
| Ownership of shares in a non-profit corporation which acquires a multi-unit dwelling as its primary asset. Shareholders also receive a proprietary lease on a unit for a duration of their share ownership. | cooperative estate |
| A method for determining value that takes into account the cost of the land and the replacement for reproduction cost of the improvements n et of estimated depreciation. | cost approach |
| Any new offer or amended offer made in response to a offer. | counteroffer |
| 1. An accounting entry on a closing statement indicating an amount a party has paid or is to receive. 2. Loan funds advanced to a borrower. | credit |
| A lender's opinion of a borrower's ability to repay a loan in view of financial capabilities and past repayment patterns. | credit evaluation |
| A widower's (husband) life estate claim to portions of his deceased spouse's (wife) real property. Not in Tennessee. | curtesy |
| In agency law, a party outside of the fiduciary relationship of client and agent. If an agent treats a customer as a client, an implied agency may result. | customer |
| A standard elevation reference point used by surveyors to measure elevations of property in an area. | datum |
| An accounting entry on a closing statement indicating an amount a party must pay. | debit |
| An underwriting equation reflecting how much debt service an investment property can reasonably afford to pay out of its net operating income; used to identify how large a loan the property can afford given an interest rate and loan term. | debt coverage ratio |
| An underwriting equation that is used to determine how much debt an individual can reasonably afford in view of the party's or household's income. | debt ratio |
| Periodic payments of interest and/or principal on a mortgage loan. | debt service |
| An instrument used to convey mortgaged property back to the lender rather than have the lender foreclose on the property. | deed in lieu of foreclosure. |
| An instrument used to convey real property to the trustee of a land trust. The truster is also the beneficiary. | deed in trust |
| An instrument used by a borrower to convey title to mortgaged property to a trustee to be held as security for the lender, who is the beneficiary of the trust. 3 parties involved, makes it easier to foreclose. | deed of trust |
| "A provision in a deed that limits or places rules on how the deeded property may be used or improved. | Deed Restriction |
| A fee estate where ownership is perpetual, provided that usage restrictions or other conditions stated in the deed are upheld. If not, the fee reverts to the grantor. | defeasible fee |
| A court order enabling a damaged lender to attach a lien on the defaulted borrower's property of an amount equal to the difference between the debt and the proceeds of a foreclosure sale. | deficiency judgement |
| a quantity of a product of serve i.e. that is desired for purchase, lease, or trade at any given time. | demand |
| A measure of the degree of residential land use within a given area for purposes of residential zoning and land use control. | density |
| Valuable consideration accompanying an offer to purchase real estate that signifies the offeror's good faith intention to complete a sale or lease contract. | deposit |
| The portion of a property's total basis that may be depreciated, generally the basis of the improvements, since land cannot be depreciated. | depreciable basis |
| 1. A non-cash expense taken against the income of investment property that allows the owner to recover the cost of the investment through tax savings. 2. A loss of value to improved property. | depreciation |
| A body of state-level laws that stipulates how an estate will be passed on to heirs in the absence of a valid will. | laws of decent and distribution |
| A defeasible fee estate where title automatically reverts to the grantor if usage conditions stated in the deed are violated. | determinable fee |
| A transfer of real or personal property from the devisor to the devisee(s) by mesa of a will. | devise |
| A financial practice of reducing the value of dollars received in the future by an amount that reflects the interest that would have been earned if the dollars had been received today. | discounting |
| A finical analysis to identify the discounted value of the cash flow of an investment over a given number o years. | discounted cash flow analysis |
| A failure to provide equal opportunity for persons to acquire or finance housing based on race, color, religion, national origin, sex, handicapped status, marital status, or family status. | "discrimination in housing |
| Direct investment without the intermediation of a bank or other depository institution to make loans and other investments. | disintermediation |
| A tax stamp affixed to a property document or record as evidence that the owner has paid taxes related to the financing or transfer of real property. | documentary stamp |
| The property that benefits from the existence of an easement appurtenant. The holder of the easement is the dominant tenant. | dominant tenement |
| A widow's (wife) life estate interest in portions of deceased spouse's (husband) real property. Not in Tennessee. | dower |
| Representing both principal parties to a transaction. | dual agency |
| A loan provision defining the lender's right to accelerate a note upon the transfer of collateralized property. | due on sale |
| An impound account used for the safekeeping of a buyer's earnest money deposit; accompanied by specific instructions to the escrow agent for holding an disbursing the funds. | earnest money escrow |
| "An interest in real property giving the interest holder the right to use defined portions of another's property. May or may not attach to the estate. | easement |
| The period during which an improvement is expected to remain useful in its original use. Establishes the improvement's annual depreciation amounts in appraisal. | economic life |
| A loss of value in a property because of external factors generally beyond the control of the downer, for example, a municipality's lack of funds to improve deteriorated roadways. Also call external obsolescence. | economic obsolescence |
| The actual income of an investment property before expenses, expressed as total potential income minus vacancy and collection losses. | effective gross income |
| A right of a surviving spouse to claim a prescribed portion of the decedents' real and personal property in place of he provisions of the decedent's will. This is true for Tennessee. | elective share |
| Plants and crops considered personal property, since human labor is required for planting, growing and harvesting. | emblements |
| A power of a government entity to force the sale of private property for subsequent public use. | eminent domain |
| An unauthorized physical intrusion of one's real property into the real property of another. | encroachment |
| An interest, right or intrusion that limits the freehold interest of an owner of real property or otherwise adversely effects the marketability of title. | encumbrance |
| Legal status of a valid contract or other document that a court of law will force to be performed. | enforceability |
| An averaging of assessed valuations in an area to compensate for ad valorem tax inequities. | equalization |
| A theoretical market state in which the forces of supply and demand are in balance. | equilibrium |
| An interest that gives a lien holder or buyer the right to acquire legal title to a property if certain contractual conditions occur. | equitable title |
| That portion of a property's value owned by the legal owner, expressed as the difference between the property's market value and all loan balances outstanding on the property. | equity |
| A mortgagor's right to pay off a defaulted mortgage and reclaim the property, provided the redemption occurs before the completion of the foreclosure sale. | equity of redemption |
| A lease clause providing for an increase in rent. | escalator clause |
| A reversionary transfer of real property to the state or county when the legal owner dies without a will and without heirs. | escheat |
| A trust or impound account used for the property handling of funds and documents in the closing of a real property transaction. Account borrower establishes to ensure that adequate funds will be available for payment of taxes and insurance. | escrow |
| 1. A set of rights to real property that includes the right of possession. 2. The totality of one's personal and real property ownership. | estate |
| An estate | estate in land |
| A legal restraint to prevent a person from claiming a right or interest that is inconsistent with the person's previous statements or acts. An estoppel certificate documents the party's initial position or act, which cannot be contradicted later. | estoppel |
| Standards governing proper and professional business practices. | ethics |
| Removal of a tenant from a property because of a lease default. | eviction |
| Actual or constructive notice of real property ownership, including opinion of title, certificate of title, and title insurance. | evidence of title |
| One of the bundle of legal rights to real property enabling the owner to prevent others from entry or use. | exclusion |
| A listing agreement which pays the listing broker a commission if anyone other than the property owner procures a customer. | exclusive agency |
| A listing agreement which pays the listing broker a commission if anyone at all procures a customer | exclusive right to sell |
| A completed agreement which enjoins one or both principal parties to perform certain actions in order for the contract to become fully executed. Pending sale. | executory contract |
| A transaction broker who assists principal parties in completing a transaction without acting as a fiduciary agent of either party. | facilitator |
| Anti-discrimination legislation designed to ensure that all parties have equal access to mortgage financing. | fair financing laws |
| Anti-discrimination legislation designed to ensure equal opportunity in housing to all home buyers. | fair housing laws |
| A quasi-governmental agency that insures deposits of depository institutions and otherwise develops regulations for the banking industry. | Federal Deposit Insurance Corporate (FDIC) |
| A major secondary mortgage market organization which buys conventional, FHA, and VA loans and sells mortgage backed securities. | Federal Home Loan Mortgage Corporation (Freddie Mac) |
| An agency of the department of housing and urban development which insures permanent long-term loans that meet certain qualifications. | Federal Housing Administration (FHA) |
| A government-sponsored agency in the secondary mortgage market which buys conventional, FHA, and VA loans, sells mortgage-backed securities, and guarantees payment of principal and interest on the securities. | Federal National Mortgage Association (Fannie Mae) |
| The principal regulator of the money supply as well as the American banking system. | Federal Reserve System |
| An estate representing the highest form of legal ownership of real property, particularly the fee simple absolute estate. | fee simple |
| The agent in an agency relationship; receives the trust and confidence of the principal and owes fiduciary duties to the principal. | fiduciary |
| Duties of an agent to the principal in an agency relationship, including skill, care, diligence, loyalty, obedience, confidentiality, disclosure, and accounting. | fiduciary duties |
| An item permanently attached to land so as to e defined as real property. | fixture |
| A procedure for forcing sale of a secured property to satisfy a lien holder's claim. | foreclosure |
| An ownership estate of indeterminable duration; contrasts with a leasehold estate. | freehold estate |
| A lease requiring the landlord to pay all of a property's operating expenses, including those that pertain to an individual tenant. Used most often. | full-service / gross lease |
| A loss of value in an improved property because of design flaws or failure of the property to meet current standards. May be curable or incurable. | functional obsolescence |
| A fiduciary relationship which authorizes the agent to conduct a broad range of activities for principal in a particular business enterprise. May or may not include authority to enter into contracts. | general agency |
| A lien against any an all property owned by a lienee | general lien |
| A for-profit business where two or more co-owners agree to share management responsibilities and profits. Does not involve silent partners, as in a limited partnership. | general partnership |
| A bargain and sale deed containing the assurance that the grantor will defend against any and all claims to the title. | general warranty deed |
| An intangible business asset valued at the difference between the sale price and the value of all other assets of the business. | goodwill |
| A division of HUD which guarantees FNMA mortgages and securities backed by pools of VA-guaranteed and FHA-insured mortgages. | Government National Mortgage Association (Ginnie Mae) |
| A party who receives a right, interest or title to real property from another. | grantee |
| A party who transfers a right, interest, or title to real property to another. | grantor |
| A personal right to use another's property, granted by the owner; does not attach to the estate, and there are no dominant or servant tenements. | gross easement |
| A shortcut method for estimating the value of an income property by multiplying the property's gross annual income times a multiplier that reflects the ratio between gross annual income and sale price that is typical for similar properties in the area. | gross income multiplier |
| A lease of the land-only portion of a parcel of real property | ground lease |
| Insurance against loss or damage to real property improvements; required by most mortgage lenders to protect the collateral. | hazard insurance |
| A theoretical use of a property that is legally permissible, physically possible, financially feasible, and maximally productive, usually in terms of net income generation. | highest and best use |
| A will prepared entirely in the testator's handwriting, complete with date and signature. | holographic will |
| or mortgage loan on a residence, secured by portions of the owner's equity in the home. | home equity loan |
| Laws that protect a homeowner against loss of the homeowner's principle residence to a sale forced by creditors to collect debts. Also protect the interests of individual spouses by requiring both spouses to sign any conveyance of the homestead property. | homestead laws |
| An exemption of a portion of the assessed value of a homeowner's principal residence from ad valorem taxation. | homestead tax exemption |
| Use of real property as collateral for a mortgage loan. | hypothecation |
| An agency relationship that arises by implication from the actions and representations of either agent or principal. | implied agency |
| An unstated or unintentional agreement that may be deemed to exist by implication because of acts or statements by any of the parties to the agreement. Not enforceable. | implied contract |
| Any manmade structure or item affixed to land. | improvement |
| A method of appraising the value of a property by applying a rate of return to the property's net income. | income capitalization |
| An underwriting ratio that relates a borrower's gross or net income and the debt service of a loan; used to determine how large a loan a borrower can reasonably afford. | income ratio |
| A sales agent who works for a broker but is not legally an employee. The employer exerts only limited control over the contractor's actions, does not provide employee benefits, and does not withhold taxes from the contractor's pay. | <p>independent contractor |
| A lien whose priority is subordinate to that of a superior (tax) lien. Priority among inferior liens is established according to the time of recordation, with the exception of the mechanic's lien. Also called junior lien. | inferior lien / junior lien |
| 1. A right to real property. 2. A lender's charge for the use of the principal amount of a loan. | interest |
| The percentage of a loan amount that a borrower must pay a lender annually as interest on a loan amount. | interest rate |
| Investment by a depository institution on behalf of depositors. | intermediation |
| The rate at which inflows from income property investment must be discounted in order for the total inflows over time to equal the initial outlay, expressed as a percent; may include projected proceeds from the future sale of the property as an inflow. | internal rate of return |
| Legal condition of a person who dies without a leaving a will. | intestate |
| Expenditure to purchase an asset with the expectation of deriving a future profit or benefit from the asset. | investment |
| A transfer of title to real property without the consent or against the will of the owner, for example, eminent domain, foreclosure, and adverses possession. | involuntary alienation |
| A lien imposed by legal process irrespective of the owner's wishes or consent. | involuntary lien |
| A form of real property ownership in which co-owners share all rights and interests equally and indivisibly; entails right of survivorship. Defining characteristics are unity of time, equal ownership, transfer of ownership, survivorship. | joint tenancy |
| A partnership created for a specific predetermined business endeavor, after which the joint venture is usually dissolved. | joint venture |
| A court decision resulting from a lawsuit. If a creditor sues to collect a debt, a favorable ruling is followed by a judgment lien against the defaulting borrower's property. | judgment |
| A court proceeding triggered by a foreclosure suit. Involves notice, debt acceleration, the termination of the owner's interests in the property, and a public sale where proceeds are applied to the debt. | judicial foreclosure |
| The surface area of the earth, all natural things permanently attached to the earth, and everything beneath the surface to the earth's center and above the surface extending upward to infinity. | land |
| A trust in which a truster conveys a fee estate to a trustee and names himself or herself as beneficiary. The beneficiary in turn controls the property and the actions of the trustee. | land trust |
| Regulation of how individual owners use property in a municipality or planning district. Control patterns are generally in accordance with a master plan. | land use control |
| A parcel of property lacking legal access to a public thoroughfare; requires a court-ordered easement by necessity to relieve the condition. | landlocked |
| A body of law defining roles, duties and responsibilities of an agent and a principal. Laws also set forth standards of conduct agent and principal owe to a customer. | law of agency |
| A legal contrat and instrument of conveyance which transfers to the tenant, or lessee, a leasehold fee for a certain duration. Sets forth all tenant and landlord covenants, financial terms, and grounds for default. | lease |
| A life estate established by operation of law rather than by the actions or wishes of the property owners. Examples are homestead law, dower, curtesy, and elective share. | legal life estate |
| An estate that entails temporary rights of use, possession, and to an extent, exclusion, but not legal ownership. | leasehold estate |
| A description of a parcel of property which accurately locates and identifies the boundaries of the subject parcel to a degree acceptable by local courts of law. | legal description |
| The relationship between the yield rate of an investment and the interest rate of funds borrowed to finance the investment. | leverage |
| 1. An accounting entry representing a claim against the assets of a business by a creditor. 2. A condition of vulnerability to lawsuits seeking redress for potentially wrongful acts or statements. | liability |
| An individual's personal right to use the property of another for a specific purpose. Revocable at any time at the owner's discretion. Does not attach to the property and terminates upon the death of either party. | license |
| A creditor;s claim against real or personal property as security for a property owner's debt. A lien enables a creditor to force the sale of the property and collect proceeds as payment toward the deb. | lien |
| The order in which liens against a property are satisfied; the highest priority lien receives sale proceeds from a foreclosure before any other lien. | lien priority |
| A state whose laws give a lender on a mortgaged property equitable title rather than legal title. The mortgagor in a lien theory state retains legal title. | lien theory state |
| A freehold estate that is limited in duration to the life of the owner or other named person. On the death of this person, legal title passes to the grantor or other named party. | life estate |
| An agency relationship which restricts the agent's authorizations to a specific set of duties. The relationship usually terminates on performance of these duties, as in a real estate broker's listing agreement. | limited agency / special agency |
| A business enterprise consisting of general and limited partners: general partners manage the affairs of the business while limited partners are silent investors. | limited partnership |
| In a contract, a clause that expressly provides for compensation a defaulting party owes the damaged party. In the absence of such a clause, a damaged party may sue for unliquidated damages. | liquidated damages |
| The degree to which an investment is readily marketable, or convertible to another form of asset. Real property is relatively illiquid in comparison with other types of investment. | liquidity |
| A public notice in a foreclosure proceeding that the mortgaged property may soon have a judgment issued against it. Enables other investors to join in the proceeding if they wish to collect their debts. | lis pendens |
| A legal contract that establishes and controls the dynamics of the agency relationship between principal and agent. The principal to the listing may be buyer, seller, landlord, or tenant. | listing |
| A set of water rights defined by state law relating to parties abutting navigable bodies of water such as lakes and bays. Generally, a property owner enjoys usage rights but owns land only to the high water mark. | littoral rights |
| A trust established during one's lifetime in which the truster conveys legal title to property to a trustee and names another party as beneficiary. | living trust |
| A lender's written pledge to lend funds under specific terms. May contain deadlines and conditions. | loan commitment |
| An underwriting ratio that relates the size of a loan to the market value of the collateral. The closer the loan value is to market value, the riskier the loans for the lender. | loan-to-value ration (LTV) |
| A method for legally describing property in a subdivision where lots are identified by block and number. A recorded metes and bounds or rectangular survey description of the subdivision underlies the lot and block system. | lot and block system |
| 1. Buyers and sellers exchanging goods and services through the price mechanism. 2. The totality of interactions between supply and demand for a specific set of products or services in a particular geographic area. | market |
| An opinion of the price at which a willing seller and buyer would trade a property at a given time, assuming a cash sale, reasonable exposure to the market, informed parties, marketable title, and no abnormal pressure to transact. | market value |
| A condition of title to a property where there are no claims, liens, or encumbrances clouding title or impeding the property's transferability. | marketable title |
| An agent's design for procuring a customer for a client, including selling and promotional activities. | marketing plan |
| A deed used to convey land to a condominium developer. | master deed |
| A junior lien enabling property builders, suppliers, and contractors to secure debt arising from labor and materials expended on a property. | mechanic's lien |
| A north-south line used in a rectangular survey system of legal descriptions. | Meridian |
| A method of legally describing property which utilizes physical boundary markers and compass directions for describing the perimeter boundaries of a parcel. | metes and bounds |
| The ad valorem tax rate of a taxing district, derived by dividing revenues required from taxpayers by the districts tax base. If the millage rate is 30, the tax rate is 3%, or $3.00 per $100 of assessed valuation (net of exemptions). | millage rate |
| One one-thousandth of a dollar ($.001). Used to quantify the ad valorem tax rate in dollars. | mill |
| Separable subsurface rights to mineral deposits; transferrable by sale or lease to other parties. | mineral rights |
| A statement or act, or failure to make a statement or act, that misleads a party in a transaction. May be intentional or unintentional. May warrant legal recourse or license revocation. | misrepresentation |
| A fixed, artificial or natural landmark used as a reference point in a metes and bounds legal description. | monument |
| A legal document wherein a mortgagor pledges ownership interests in a property to a lender, or mortgagee, as collateral against performance of the mortgage debt obligation. | mortgage |
| Financing that uses mortgaged real property as security for borrowed funds | mortgage financing |
| An organization of brokers who agree to cooperate in marketing the pooled listings of all members. | multiple listing service (MLS) |
| Consent by all principals to a contract to all provisions of the contract. A requirement for validity. | mutual consent |
| A situation in which the loan balance of an amortizing loan increases because periodic payments are insufficient to pay all interest owed for the period. Unpaid interest is added to the principal balance. | negative amortization |
| A legal instrument that can be sold, traded, assigned, or otherwise transferred to another party, such as a promissory note. | negotiable instrument |
| A lease which requires a tenant o pay rent as well as a share of the property's operating expenses to the extent provided for in the lease contract. | net lease |
| A listing which states a minimum sale or lease price the owner will accept, with any excess going to the broker as a commission. Professionally discouraged, if not illegal. | net listing |
| The amount of pre-tax revenue generated from an income property after accounting for operating expenses and before accounting for a debt service. | net operating income |
| A land use that is not consistent with the current zoning ordinance. May be legal or illegal. | non-conforming use |
| A forced sale of mortgaged property without a formal foreclosure suit or court proceeding. Authorized through a "power of sale" clause in a mortgage or trust deed document. There is no right of redemption / redemption period option. | non-judiical foreclosure |
| An expense incurred by buyer or seller in closing a real estate transaction that is not shared with the other party. Examples include attorney fees, documentary tax stamps, and lender fees. | non-prorated expense |
| An agreement to repay a loan of an indicated amount under certain terms | note |
| Actual or recorded public evidence of real property ownership. | notice of title |
| Without legal force or effect | null and void |
| A loss of property value because of functional or economic (external) factors. | obsolescence |
| A proposal to enter into binding contract under certain terms, submitted by an offeror to an offer. If accepted without amendment an offer becomes a contract. | offer |
| A process that creates a contract. Acceptance is the offeree's unequivocal, manifest agreement to the terms of an offer. The offer becomes a contract when the acceptance has been communicated to the offeror. | offer and acceptance |
| A non-exclusive listing which pays an agent a commission only if the agent is procuring cause of a ready, willing, and able customer. | Open listing |
| A recurring or periodic expense necessary for the operation of an income property. Examples include utilities, management, and ad valorem tax expenses. Excluded are debt service and the property's income tax liability. | operating expense |
| An attorney's or title officer's opinion of the condition and marketability of title to a parcel of property based on a recent search of title records by a competent party. | opinion of title |
| A unilateral contract in which an owner, or optionor, grants a buyer or tenant, the optionee, a future right to be exercised before a deadline, in exchange for valuable consideration. | option |
| A lender's charge for funding a loan. | origination fee |
| An easement appurtenant where owners of two adjacent properties share an improvement along the property boundary. The parties agree not to perform acts that would adversely affect the other party's interest in the shared improvement. | party wall easement |
| A retail property lease which requires a tenant to pay a minimum amount of rent plus an additional increment that reflects the sales achieved by the tenant. | percentage lease |
| Fulfillment of the terms of a contract. | performance |
| A leasehold interest for a lease ten where, in the absence of default, the term automatically renews itself until proper notice of termination is provided by either party. | periodic tenancy |
| All property that is not considered real property; all property that is not land or permanently attached to land, excepting trade fixtures and emblements. | personal property |
| A loss of value to property because of decay or natural wear and tear. Exacerbated by deferred maintenance, or the failure to repair or maintain property on a regular basis. | physical deterioration |
| A multi-use development project requiring special zoning and involving deed restrictions. | planned unit development (PUD) |
| A map of one or more properties indicating each parcel's lot and block number, boundaries, and dimensions. | plat |
| An increment of value addd by the assemblage of continuous properties. | plottage |
| One-percent of a loan amount, a lender's finance charge | point |
| The origination and termination point in a metes and bounds legal description. | point of beginning (POB) |
| A state's or local government's legal authority to create, regulate, tax, and condemn real property in the interest of the public's health, safety, and welfare. | police power |
| The maximum amount of revenue a property could generate before accounting for vacancy, collection loss, and expenses. Consists of total rent with full occupancy at established rent rates, plus other income from any source. | potential gross income |
| An authorization granting a fiduciary the power to perform specified acts on the principal's behalf. Used to establish a universal agency relationship. | power of attorney |
| The discounted value of an amount of money to be received in the future that accounts for the interest that would h ave been earned if the money had been received in the present. | present value |
| An act of collusion where competitors agree to establish prices at certain levels to the detriment of customers or other competitiors. | price fixing |
| 1. The employer in an agency relationship, to whom the agent owes fiduciary duties. 2. The loan balance to which interest charges are applied. | principal |
| A designed meridian in the rectangular survey system that is used in conjunction with a base line to identify ranges, tiers, and townships. | principal meridian |
| A legal doctrine granting a state the power to control and regulate the use of water resources within state boundaries. Tennessee does not have this. | prior appropriation |
| A voluntary conveyance of property by a private party. | private grant |
| An insurance policy, purchased by a borrower, that protects a lender against loss of that portion of a mortgage loan which exceeds the acceptable loan-to-value ratio. This can be removed when the LTVR reaches 78%. | private mortgage insurance (PMI) |
| A party who was first to obtain a ready, willing, and able customer, or a party who expended the effort to induce the customer to complete the transaction. | procuring cause |
| An item that has a legal owner, along with the attendant rights to legal ownership. | property |
| The business of managing the physical and financial condition of an investment property for an owner. Oversee specific properties on behalf of the owners. | property management / managers |
| A cooperative owner's lease on a unit in the cooperative building. The lease runs concurrently with the owner's ownership interest in the cooperative. | proprietary lease |
| Apportionment of expense and income items for closing. Examples of items prorated between buyer and seller include interest, insurance, taxes, and rent. | proration |
| A voluntary conveyance of property by a government entity to a private party. | public grant |
| A life estate where the grantee's interest endures over the lifetime of another party named by the grantor. i.e., when someone can't care for themselves and they have a caregiver. | pur autre vie |
| A mortgage loan where the seller ends a buyer some or all of the purchase price of a property. | purchase money mortgage |
| 1. A mortgage underwriting procedure to determine the financial capabilities and credit history of a prospective borrower. 1. A listing and marketing procedure to determine the needs and urgency of a client or customer. | qualification |
| A right of an owner or tenant to use a property without interference from others. | right of enjoyment |
| A court proceeding to clear a property's title of defects, claims and encumbrances. | quiet title suit |
| A north-south area bounded by consecutive meridians. | range |
| Land and all man made structures permanently attached to it. | real estate |
| An investment in which owners purchase shares in a trust which owns or acquires real property. Investors receive income and gain on a per-share basis. | real estate investment trust (REIT) |
| Real estate and the bundle of rights associated with ownership of real estate | real property |
| An appraiser's weighted blending of the results of different approaches to value into final value estimate. | reconciliation |
| An act of entering into public title records any document or transaction affecting title to real estate. Recording gives constructive notice of one's rights and interests in a property and established the priority of inferior liens. | recording |
| A method of legally describing real property which uses longitude and latitude lines to identify ranges, tiers, and townships. | rectangular survey system / government survey system |
| A statutory period after a foreclosure sale during which the foreclosed owner may buy back the property by paying all sums due the lender. Not an option in a non-judicial foreclosure. | redemption period / equity of redemption |
| The illegal lending practice of restricting loans by geographical area. | readlining |
| Obtaining a new loan to replace an existing loan, usually to take advantage of lower interest rates, to obtain a longer-term loan, or to liquidate equity. | refinancing |
| A fair financing law applying to residential loans; lenders must disclose financing costs and relevant terms of the loan to the borrower. | Regulation Z |
| A future freehold interest in a life estate held by a third party remainderman named by the grantor. When the life tenant dies, the estate passes to the remainderman. | remainder |
| The cost of constructing a functional equivalent of a property at current labor and materials costs using current construction methods. | replacement cost |
| An amount of money allocated from a property's income to cover future repair and maintenance costs. | reserve allowance |
| A limitation on the use of a property imposed by deed, zoning, state statue, or public regulation. | restriction |
| 1. A transfer of title from a life estate tenant back to the grantor. 2. Proceeds from the sale of property at the end of a holding period in a cash flow analysis. | reversion |
| 1. Cancellation of a contract 2. Cancellation of a real estate license. | revocation |
| Water rights of a property that abuts a watercourse (stream, river). Navigable - only extends to waters edge; non-navigable - unrestricted and owns the land beneath the water to the midpoint. | riparian rights |
| A contract for the purchase and sale of real property containing all terms and provision of the sale and describing the responsibilities of the parties. | sale contract |
| A sale of a property executed simultaneously with a leaseon the property from the buyer back to the seller as tenant. | sale leaseback |
| A method of appraising property that relies on the principle that a property is generally worth what other, similar properties are worth. | sales comparison approach |
| A licensed employee or independent contractor hired by a broker to perform authorized activities on behalf of the broker's client. | salesperson |
| The degree of unavailability of a product or service in relation to demand for the product or service. A critical element of value. | scarcity |
| A mortgage loan whose lien priority is subordinate to a senior, or first, mortgage. | second mortgage |
| "Lenders, investors, and government agencies who buy, sell, insure, or guarantee existing mortgages, mortgage pools, and mortgage-backed securities. Fannie Mae, Freddie Mac, Ginnie Mae | Secondary mortgage markets |
| An area defined by a rectangular survey system and consisting of 1/36th of a township, or one square mile. | section |
| An authorization to broker securities. The Series 39 and 22 securities licenses authorize licensees to broker real estate securities. | securities license |
| 1. Collateral for a loan. 2. A type of personal property investment, for example, bonds, stocks, and mutual funds. | security |
| Any financing arrangement where a seller takes a note and mortgage from the buyer for all or part of the purchase price of the property. | seller financing |
| A market condition characterized by an excess of buyers over sellers. | seller's market |
| A property containing an easement that must "serve" the easement use belonging to a dominant tenement. | servient tenement |
| A conversion of real property to personal property through detachment of the iitem from the land. | severance |
| A business entity with an individual as sole owner. The death of the owner terminates the business. | sole proprietorship |
| A lien against property to secure a tax levy for a specific public improvement, such as a new road or sewer. Only properties benefitting from the improvement are taxed and liened. | special assessment lien |
| A land use in conflict with current zoning that is nevertheless authorized because of its perceived benefit to the public welfare. | special exception |
| A lien placed against a specific item of property rather than against all of an owner's property. | specific lien |
| Forced performance of one's obligations in a agreement, to the letter of the agreement. A legal remedy for a damaged party to take against a defaulting party. | specific performance |
| A law requiring certain contracts to be in writing in order to be enforceable. Examples are real property conveyances, listing agreements, and long term leases. | statute of frauds |
| A law which restricts the period during which a damaged party may seek to rescind or disaffirm a contract or take other legal actions. | statute of limitations |
| The prohibited practice of channeling prospective buyers and tenants toward or away from a particular area. | steering |
| A court proceeding which gives a creditor legal title to a liened property rather than cash proceeds from a court-ordered sale. | strict foreclosure |
| An agency relationship between the client of a listing broker and other brokers and salespeople who have agreed to assist the broker in procuring a customer for the client. Agent of an agent. | subagency |
| A transfer by a tenant of portions of the rights and obligations of a lease to another party, the sublessee. The original tenant remains primarily liable to the landlord for fulfilling lease obligations. | sublease |
| A voluntary or involuntary placing of a lien's priority below that of another. a mortgage lien, for example automatically subordinates to a real estate tax lien. | subordination |
| An appraisal principle that holds that a buyer will pay no more for a property than a buyer would pay for an equally desirable and available substitute property. Forms the foundation for the sales comparison approach to value. | substitution |
| Rights and interests to whatever is beneath the surface of one's parcel of real property. | subsurface rights |
| A landlord's formal legal avenue for evicting a tenant. | suit for possession |
| 1. One of a class of liens that by law have a higher priority than an junior lien; all are tax liens. 2. A junior lien whose priority is higher than that of another lien. | superior lien |
| The quantity of a product or service available for sale, lease, or trade at any given time. | supply |
| Rights to the surface area of a parcel of real estate. | surface rights |
| a formal measurement of the boundaries, dimensions, and elevations of a parcel of real estate performed by a professional surveyor. Required by lenders to identify possible encroachments, easements, and flood hazards. | survey |
| A surviving joint tenant's right to receive all rights and interests in the property enjoyed by another joint tenant in the event of the latter's death. | right of survivorship |
| A real estate investment structure in which investors provide capital and organizers provide management expertise to develop and acquire and manage investment real estate for profit. | syndication |
| The total of the assessed valuation of real properties within a taxing jurisdiction, less the total of exemptions. | tax base |
| An instrument that gives the holder the right to apply for a tax deed after paying taxes on a property and after a statutory period. | tax certificate |
| A deed used to convey title to a property sold in a tax foreclosure. | tax deed |
| A local government entity authorized by state, county, or municipality to levy taxes for a particular purpose. | tax district |
| Annual income from an investment property that is subject to taxation, generally equal to net operating income plus reserves minus depreciation and interest expense. | taxable income |
| An estate where each co-owner owns an electable share of the property and can transfer this share to any other party. Does not include the right of survivorship; interests of deceased owners pass to heirs. | tenancy in common |
| An estate in real property owned by a single party. | tenancy in severalty |
| The legal condition of a person who dies leaving a valid will. | testate |
| An area between consecutive parallels, as defined in the rectangular survey system. | tier |
| A fee or leashold interest in a property that is shared by owners who have use of the property at different times. Lease or right to use only, no ownership; developer owns unit. | time share |
| Ownership of real property as well as evidence of such ownership; legal title. | title insurance |
| A policy that protects the holder against loss arising from defects in title or documents conveying title. | title insurance |
| Public records of real property documenting the history ownership, claims, ownership, conveyances, legal descriptions, and surveys. | title records |
| A state whose laws give legal title of a mortgaged property to the mortgagee until the mortgagor satisfies the terms and obligations of the loan. | title theory state |
| A title recording system that registers title to property as well as liens and encumbrances, on a title certificate. The certificate is the title and reflects everything there is to be known about the condition of the title. | Torrens System |
| An area six miles square, bounded by two consecutive parallels and two consecutive meridians in the rectangular survey system. Contains 36 sections. | township |
| A fixture necessary for the conduct of a business. Although affixed to the land, it is personal property. | trade fixture |
| A fiduciary relationship between a truster and trustee. The truster conveys legal title to property to the trustee, who holds and manages the estate for the benefit of another party, the beneficiary. | trust |
| 1. A process of investigating the financial capabilities and creditworthiness of a prospective borrower and granting credit to a qualified borrower. 2. The act of insuring or financing a party, business venture, or investment. | underwriting |
| Services that differ in nature or quality from those normally rendered, with the alternation based on race, color, sex, national origin, or religion. | unequal services |
| An agreement in which only one party promises to perform, contingent on the other party's performance of an optional action. | unilateral contract |
| A fiduciary relationship which employers an agent to perform an and all actions for a principal that may be legally delegated. | universal agency |
| Excessive or illegal interest charged on a loan. | usury |
| A measure of the unoccupied supply of exiting space in a building or market at any point in time. A vacancy rate is the amount of vacant space divided by the total amount of existing space. | vacancy |
| Legal status of a contract that meets requirements of: competence of parties, mutual consent, valuable consideration, legal purpose, and voluntary good faith. A prerequisite for enforceabilitiy. | validity |
| In general, the worth of an item as determined by its utility, desirability, scarcity, affordability, and other components and quantified as price. | value |
| A land use that conflicts with current zoning but is authorized for certain reasons, including undue hardship to comply and minimal negative impact to leave it alone. | variance |
| Without legal force or effect; unenforceable and null, such as an illegal contract. Results when illegal purpose, operations of law prevents, acts of nature. | void |
| An agreement that is null and cannot be enforced. | void contract |
| An agreement that is subject to being nullified because a party to the agreement acted under some legal disability. Only one party may cancel, minor, party acted under duress or undue force/coercion threat, undue influence. | voidable contract |
| Rights of a property that abuts a body of water to own or use the water. | water rights |
| Last will and testament; a written or verbal statement by a testator instructing how to distribute the testator's estate to heirs. | will |
| Investment return expressed as a dollar amount or a percent of the original investment amount. | yield |
| A municipal land us regulation. | zoning ordinance |
| TREC - A person who by means of personal inducement, solicitation, or otherwise attempts to directly encourage any person to attend a sales presentation for a time-share program. | acquisition agent |
| TREC - Means conditions or occurrences generally recognized by competent licenses that have negative impact of the value of the real estate. | adverse facts |
| TREC - Any person engaged under contract by or on behalf of a licensed broker to participate in any activity included in subdivision. | affiliate broker |
| TREC - Any person who, for a fee, commission, finder's fee or any other valuable consideration or with the intent or expectation of receiving a fee, commission on the sale of real estate. | broker |
| TREC - Party to a transaction with whom the broker has entered into a specific written agency agreement to provide services. | client |
| TREC - Any party, other than a client in a transaction, for whom or to whom a licensee provides services. | customer |
| TREC - A licensee who has been chosen by the licensee's managing broker to serve as the agent of an actual or prospective party to a transaction, to the exclusion of other licensees employed by or affiliated with the broker. | designated agent |
| TREC - A situation in which the licensee has agreements to provide services as an agent to more than one party in a specific transaction and in which the interests of the parties are adverse. | dual agency |
| TREC - Any licensee who assists one or more parties to a transaction who has not entered into a specific written agency agreement representing one or more of the parties. | facilitator / transaction broker |
| TREC - An agency relationship created for the purpose of providing real estate services on identified real estate tasks or projects in exchange for a fee, salary, or retainer for a preset /prepaid fee. | limited/advisory agency |
| TREC - Means and includes leaseholds, as well as any other interest or estate in land, whether corporeal, incorporeal, freehold or non-freehold, and whether the real estate is situated in this state or elsewhere. | real estate |
| Residential, Commercial, Industrial, Agricultural, Special Purpose | classifications of real estate by use in Tennessee |
| www.boma.org | Building Owners and Managers Association |
| www. irem.org | Institute of Real Estate Management |
| www.nareb.com | National Association of Real Estate Brokers |
| www.realtor.com | National Association of Realtors |
| www.wcr.org | Women's Council of Realtors |
| Possess, Use, Transfer (ownership), Encumber (Mortgage), Exclude (others use) | Bundle of Rights |
| If an item is uniquely adapted to the property, or the property is custom-designed to accommodate the item. i.e., house keys, garage door opener, door/window screens. | adaptation |
| Immobile, Industructible, Heterogeneous (unique) | Characteristics of land |
| Establishes absolute right of private ownership of real estate; prohibits federal government from levying real property taxes; prohibit discrimination, environmental standards, standards for legal descriptions, environmental standards | Federal Constitution |
| Establish standards for protecting interests of handicapped people." | Federal laws |
| May establish right to levy tax; or may delegate right to counties and municipalities, regulate real estate licensing, establish broad usage standards | State Constitution |
| Define, qualify ownership rights" | state laws |
| Regulates practitioners, administer real estate license laws. crewe and enforce real estate taxation | state agencies |
| Control land usage over specific parcels of land" | local laws |
| Regulates estate ownership and usage according to customer and accepted practices. | courts common law |
| Regulates real estate ownership and usage according to prior court decisions. | courts case law |
| Estate for years - definite term types of leasehold estates; Estate from period to period - definite term but with renewable; Estate at will - no definite term and no renewal; Estate at sufferance - tenant occupying without consent | Four types of leasehold estates |
| Form of ownership reserved exclusively for husband and wife. | tenancy by the entireties |
| Personal right that one party grants to another to use the grantor's real property. Th right does not attach to the grantor's estate; Verbal can be revoked. Can be personal or commercial. | easement in gross |
| Grantor owns estate to be conveyed | Warrant of seisin |
| Not disturbed by third party title disputes | Warrant of quite enjoyment |
| Granter will assist in clearing any title problems discovered later | Warrant of further assurance |
| Warranty of title - grantee will receive good title | Warranty forever |
| No encumbrances on the property | Warrant of encumbrances |
| Contains the conveyance intentions; names the parties; describes the property; indicates nominal consideration. (the only required clause) | granting clause, or premises clause for deed |
| "Bargain and sale deed; General warranty deed - most common; Special warranty deed; Quitclaim deed; | Statutory deeds |
| "Personal representative's deed | executor to convey decedent's estate |
| Guardian's deed | court appointed guardian |
| Sheriff's deed | foreclosure |
| Deed of trust | third party trustee as collateral for a a loan |
| Deed in trust | for land trust |
| Master deed | condominium developer |
| Partition deed | convey co-owned property |
| Patent deed | transfer government property |
| Tax deed | property sold at a tax sale |
| "Regulate leasing and management practices of landlords and residential properties. Sets standards for improving oral, vague, or unbalanced lease agreements. | Uniform Residential Landlord and Tenant Act (URLTA) |
| Air - Asbestos, Carbon monoxide, formaldehyde, lead, mold, radon;Soil and water - underground storage tanks, wetlands;Other ambient and natural conditions - Electromagnetic fields, noise, earthquake and flood hazards" | Environmental Controls areas of concern |
| Acts addressing the disposal of solid and toxic wastes and measures for managing waste. In addition, the Superfund act provided money for hazardous waste disposal and the authority to charge cleanup costs to responsible parties. | CERCLA Superfund (1980) and SARA Superfund amendment (1986) |
| "1mile | = 5,280 ft. or 640 acres |
| Acre | = 43,560 sq. ft. |
| 1/4 | = 160 acres |
| 1/4 of 1/4 always | = 40 acres |
| 1/4 of 1/4 of 1/4 always | = 10 acres |
| Contract in which all there terms and covenants of the agreement have been manifestly state and agreed to by all parties, whether verbally or in writing. Enforceable. | express or implied contract |
| Most states require listing agreements, sales contracts, and leases exceeding one year to be in writing to be enforceable. | oral vs. written contracts |
| "Sherman Antitrust Act - 1890 | - empowers government to proceed agains antitrust violators |
| Clayton Antitrust Act - 1914 - | predatory price cutting and certain labor strikes, picketing and boycotts |
| Anticompetitive behavior - collusion, price fixing, bid rigging, exclusive dealing, etc." | Anti Trust laws |
| Title 66 "Property" requires the seller's written summary of the property's condition at the time of contracting for sale. Required by owners of single family homes and buildings containing 1-4 dwelling units. Agents responsibility but seller completes a | Property Condition Disclosure Form |
| A federal law which aims to standardize settlement practices and ensure that buyers understand settlement costs. Applies to purchase of residential real estate (one to four family homes) to be financed by "federally related" first mortgage loans. Requires | Real Estate Settlement Procedures Act (RESPA) |
| Created in 1951, they licenses and register real estate firms, brokers and affiliate brokers. The commission also enacts rules addressing professional conduct and standards of practice. It is classified as a judicial body of government. Their mission i | Tennessee Real Estate Commission (TREC) |
| 9 | commissioners appointed by the Governor |
| Each commission serves ---- years | 5 |
| ----- must be in the business of real estate | 7 |
| ----- must not be in any field of real estate | 2 |
| of the nine, 1 must be at least ------- | 60 years old |
| and------ must be a minority" | 1 |
| "Real Estate Broker Act was established in ----- | 1973 |
| License law is created by state legislation in the Tennessee Code Annotated (TCA), | Section 62, Chapter 13 |
| Rules created by TREC are in ------- of the official TREC license Law Manual" | Chapter 1260 |
| Operating without a license is a ------- | Class B misdemeanor |
| Penalty is charged if not insured by 31st day after expiration $500 @ 6 months + $100 per month up to 12 months" | License Penalties |
| Established in order to compensate aggrieved members of the public who have been suffered monetary damages under a licensed broker. Licensees pay $30 to fund. The maximum amount of possible recovery under the account is $15K per transaction | Real Estate Education and Recovery Account |
| Licensee is responsible for paying judgement" | Real Estate Education and Recovery Account |
| Every two years as required by statue to renew a Tennessee real estate license, a resident of Tennessee must complete 16 hours of education which includes a 6 hour TREC core course for each 2-year license period. and 10+ of any other approved CE courses. | Real Estate License Renewal |
| Diligently exercise reasonable skill and care; Disclose to each party to the transaction any adverse facts - condition of property; Act with honesty and good faith; Disclose to each party to the transaction timely and accurately; Timely account for trust | Duties owed to ALL parties |
| Obey all lawful instructions of the client; Be loyal to the interests of the client; Scheduling of all property showings; Receiving all offers and counter offers and forwarding promptly to the client; Answering any questions ; Advising the client as to wh | Duty owed to licensee's client |
| "Established in 1992 for Tennessee to establish how the licensee is working with the parties (buyers & sellers) in the transaction | Law of Agency |
| Mustt contain the name and telephone number of the brokerage firm; franchise firm must show agent name, franchise firm name and telephone number. Licensee must use name shown on their license. Agent name can be same size but not larger than the name of t | Advertising |
| Do-not-call registry; 90 days allow for inquiry contacts - persons who contact you (calls on properties, visitors to open houses); Violations range from $500 - $16,000 penalties; Can-spam is for commercial electronic marking. (Fax, emails, text messaging) | State vs. Federal Laws |
| All earnest money must be deliered to the broker immediately upon receipt; Each contact shall state the amount of earnest money, who will hold thefundsa end under what conditions it may be disbursed. Earnest money funds must be held in a separate Escrow | Escrow Trust Account |
| Tennessee does not recognize this type of agency which is based on a person's actions to determine agency relationship | Implied Agency |
| Must be confirmed in writing with an unrepresented buyer prior to the preparation of an offer to purchase. | Agency Status |
| Representing no one - just handling the transaction process - Facilitator/Transaction Broker | Non-agency |
| Most common type of agency relationship. Agent is representing either buyer or seller. | Single agency |
| Representing both buyer and seller in same transaction if broker allows - MUST DISCLOSE | Dual Agency |
| Principal broker assigns to represent the client | Designated Agency |
| Limiting Services | Unbundling services |
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