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C12 Investing
CA Real Estate Practice- Investing and Other Broker-Related Fields
| Question | Answer |
|---|---|
| Appreciation | selling property for more than its worth |
| Interim Use | a property temporarily generates rent for other than its future zone use |
| Fully Depreciated | property has been charged maximum amount of depreciation allowed by IRS |
| Book Value | value of property is low according to balance sheet account balance |
| Scheduled Income | gross income that a property would generate if there were no vacancies |
| Potential Gross Income | total income a property is capable of at full capacity without deductions for expenses |
| Vacancy Factor | allowance for vacancies and uncollected rent |
| Effective Gross Income | scheduled gross income adjusted for vacancies |
| Operating expenses | include fixed and variable expenses |
| MITUM | maintenance, insurance, taxes, utilities, management = largest expenditures of an income property |
| Net Operating Income (NOI) | income used in direct capitalization Operating expenses subtracted from effective gross income |
| Times Gross | proposed selling price divided by scheduled gross income with multiplier used as ballpark figure to weigh prospective value of investment |
| Capitalization Rate (Cap Rate) | net operating income divided by selling price |
| Syndication | 2 or more people who combine their financial resources for purpose of achieving one or more investment objectives |
| Limited Partnership | (most preferred) two or more people joined together in mutual investment to share profits and losses |
| General Partnership | (not recommended) association of two or more doing business as co-owners for profit |
| Corporation | artificial being, intangible, invisible, and only existing in contemplation of law |
| Subchapter S Corporation | small business corporation taxed like partnership (taxed twice) |
| Real Estate Investment Trust (REIT) | sells ownership shares |
| Real Estate Mortgage Trust (REMT) | when main function of trust is lending money |
| Real Estate Equity Trust (REET) | trust that actually purchases property |
| Hybrid Trust | used for investments in both mortgages and real property |
| Goodwill | value of a company's brand name, customer base, customer relation, employee relations, and patents/proprietary technology |
| Uniform Commercial Code (UCC) | body of law that standardizes a number of practices in the selling of inventory |
| Bulk Transfer | sale of more than 1/2 a sellers merchandise, inventory, equipment |
| How many days before the transfer is consummated must a Notice to Creditors be recorded? | 12 business days |
| Encumbrancer | those who have a lenders interest by having placed a lien, acquired easement, imposed restrictions against it, or acquired any other interest which would encumber the property |
| Certificate of Payment of Sales & Use Tax | releases buyer from liability for sellers unpaid sale/use taxes |
| Bill Of Sale | serves same function in transfer of personal property as the grant deed does for real property |
| Net Multipliers | amount a business would sell for based on the annual net income x standard number or multiplier |
| In what kind of real estate are gross multipliers used? | income producing real estate |
| Covenant Not To Compete | seller agrees to not open a competing business for a time within specified area |
| Real Property Securities Dealer (RPSD) | person in secondary market in business of 1) selling real property securities and 2) offering to accept funds for continual reinvestment |
| CalBRE requires which license in order to receive endorsement as a real property securities dealer? | Real Estate Broker License |
| Acknowledgement | formal declaration before a duly authorized officer by person executing an instrument that such execution is his/her act and deed |
| Interstate Land Sales Full Disclosure Act | offer for sale or lease of 25 lots or more through interstate commerce or mail requires permit from Department of HUD |
| What are the dimension requirements to be considered a mobile home? | at least 8 feet wide and 40 feet long |
| Under what circumstance may a broker sell a manufactured home? | if it has been registered with the DMV for at least one year |
Created by:
lbrito0610
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