question

statutes

answer

state or federal laws

question

common law

answer

decisions and decrees of judges

question

agent

answer

one engaged to represent and be under control of a principal

question

principal

answer

one who contracts with another for representation

question

third party

answer

is a customer until they sign an agreement and then they are a client

question

agency relationship

answer

one in which an agent is hired by a principal to represent him in legal or business dealings with third parties

question

attorney-in-fact

answer

person authorized by a power of attorney

question

special agent

answer

hired for a specific service, limited authority, does not have continuous service

question

general agent

answer

hired for continuous service, hired by a special agent an associated licensee is a general agent/subagent of a special agent, the BIC

question

subagent

answer

an agent of an agent, two types: in-house and cooperative

question

dual agent

answer

a firm that represents both a seller-client and a buyer-client. neither client gets full representation. If same agent reprents both, it MUST be dual agency.

question

designated agent

answer

created by SC statute. on of the individual subagents in a brokerage who is assigned by the BIC to represent one client in a specific in house transaction that would otherwise be a dual agency. Client gets full representation. Must be two licensees, one for the buyer and one for the seller. Agency agreement must be signed before writing offer and before accepting offer. Allowed in SC but is not allowed in common law.

question

express agency

answer

written agreements, mandatory in SC

question

implied agency

answer

created only by the acts of the parties, dangerous - could create an agency relationship accidentally w/o a written agreement. NOT good

question

consideration

answer

something of value in exchange of.. is not required to create an agency relationship

question

termination of agency

answer

legal- i.e. death of principal or client or agent, performance (best), etc acts of parties - mutual agreement, breaches

question

exclusive right to sell

answer

listing broker gets paid if it is sold by ANYONE

question

exclusive agency

answer

listing broker does not get paid if owner sells

question

broker protection clause (safety clause)

answer

obligates seller to pay the broker commission if property is sold to a registered byers after listing expires. Void if lists with another broker

question

Fiduciary Duties (OLDCAR)

answer

Obedience, Loyalty, Disclosure, Confidentiality, Accounting, Reasonable Care

question

Common law obligations to third parties

answer

honesty, fair dealing, material facts

question

Lead paint

answer

built before 1978

question

Sherman and Clayton Acts

answer

anti-trust laws that promote competition. prevents price fixing, group boycotts, agree not to compete,

question

Trumps

answer

State law trumps common law

question

Agency agreements (listing/buying agreement)

answer

must be written, state agents duties/services, amount of compensation, how and when earned, if/how compensation will be divided amount coop brokers, retainer fees, signatures of all parties, price of property. Cannot auto-renew

question

Agency disclosure

answer

must be presented at the first practical opportunity, where there is substantive contact

question

SC Dept of LLC (Labor, Licensing and Regulation)

answer

government under governor, example of police power. Oversees licensing laws

question

License Law

answer

renew every two years by June 30, is to protect public interest

question

SC Real Estate Commission

answer

regulates the real estate industry, sets policy, standards, compliance, conducts disciplinary hearings and decides them. May not get involved with commission disputes. Fines 100-1000 per violation, suspends, revokes licenses, public reprimands.

question

real estate license

answer

negotiating real estate for pay. Broker-150 hours education 3 years in sales, pass broker exam. Salesman- 60 hour pre-license, state exam, 30 hour post license within 1 year, take 8 hours every two years. Can be inactive to avoid the 8 hours, but must still pay renewal fees and you still have to take post license course. expires in two years on June 30. Can only be licensed under one BIC. Must reveal you are an agent in personal transactions.

question

Accounting records

answer

must be kept for 5 years

question

trust funds

answer

earnest money, rent, security deposits. Separate account where only trust funds are deposited, must be separate from personal account, must be a demand account, account name must specify "trust fund". Deposit must be made in 48 hours for cash receipt and 48 hours after acceptance of offer for checks.

question

Acre

answer

43,560 sq ft

question

square measure

answer

Area= length x width

question

triangle

answer

area= base x height /2

question

depreciation

answer

divide 100% by the economic life

question

ad valorem

answer

property tax primary residence 4% other residence 6% assessed value x millage rate = annual property tax

question

assessed value

answer

market value x assessment rate = assessed Value

question

mill

answer

.001

question

Federal Fair housing law

answer

enforced by HUD Civil rights act 1968 - Fresh corn - familial (children under 18 living with parents, pregnant person), religion, sex, handicap, color, race, national origin) Can file a complaint with HUD - 1 year Court - 2 years

question

Handicap requirements

answer

4+ units since 1991 all areas accessbile if more than one floor 1st floor has to have this, remaining floors have to also IF there is an elevator

question

steering

answer

guiding potential buyer or renter away due to protected class

question

blockbusting

answer

scaring people into selling by playing on racial fears

question

redlining

answer

bankers not lending based on a protected class or area where property is located

question

fair housing law exemptions

answer

own no more than 3 houses most recent resident not using a realtor renting a room in your house religious organization private club (none of the above can discriminate based on race though)

question

appurtenances

answer

to appertain improvements, easements, rights of way attaches to the land and passes w/ title

question

littoral

answer

large bodies of water own land up to the high water mark

question

riparian

answer

rivers and streams own land up to center line of water

question

personal property

answer

moveable not attached to land or real property chattel - cattle emblements - crops of tenants manufactured home (not modular) real property can become personal property through severance can become real property i.e. boards into a fence transferred with a bill of sale

question

real property

answer

land plus man made addition transferred with a deed

question

trade fixtures

answer

used in a tenants business ie signs, shelving, coolers, equipment

question

Bundle of Rights

answer

CUP(i)D Control - freedom to build renovate remodel remove or destro Use - hold occupy enjoy possession - impose legal sanctions to preserve or restore one's interest disposition - may sell lease assign or dispose of

question

Economic characteristics of real estate

answer

scarcity - supply and demand improvements permanence of investment location

question

Legal description

answer

informal - street address (can be used for rentals but not for sale) metes and bounds - used by original 13 colonies plat map topo map tax map - most important used in daily real estate - find in tax records rectangular- not used in SC which uses metes and bounds. based on imaginary lines of latitude and longitude

question

Police power

answer

restrictive power used for public good

question

Eminent Domain

answer

right to take for public good given by the government condemnation is the act of taking through eminent domain

question

Escheat

answer

those who die intestate and have no heirs lose their property to the state

question

First lien

answer

ad valorem (property taxes) and special assessments Gov't gets their before all others

question

Ordinances

answer

set of rules and setbacks est. by planning and zoning board

question

Non-conforming use

answer

improvement that is not consistent with current zoning ordinance because it existed before the ordinance passed. can be terminated if damaged more than 50%, abandoned, is a nuisance

question

Upzoning and downzoning

answer

up - more dense use down - less dense use

question

Variance

answer

deviates from zoning requirements

question

Deed conditions or restrictions

answer

owner may restrict use of land so that it creates a defeasible fee (special limitation)

question

Encumbrances

answer

liens (lis pendens), easements, licenses (the right granted to one party to utilize the real property of another and can be terminated at any time. If you allow, verbally or in writing, a neighbor or friend to store a vehicle or boat on your property), and encroachments

question

Lien

answer

a charge against a property to provide security. Can be created by agreement, by law or the court. Priority of payment is usually based on date and time recorded. 2 types: specific - against property i.e. mortgage lien, property tax, mechanics and special assessments general - against individual person (normally involuntary) ie judgement, income tax lien

question

Easement

answer

right to cross property that belongs to another dominant - the property benefiting from the easement servient - the property burdened

question

Easement created by prescription

answer

open, continuous trespass for a period of time usually 10 years

question

Easement release

answer

dominant releases merger of two properties abandonment by dominant

question

Easement license

answer

privilege for specific purpose i.e. hunting, fishing cannot be transferred

question

Encroachment

answer

improvement crosses the property line of the adjoining property

question

Freehold Estate

answer

fee simple - absolute, inheritable (most complete, no restrictions)

question

Life Estate

answer

not inheritable ownership based on as long as a person is alive

question

Estate pur autre vie

answer

for the life of another - other than the life of the tenant

question

Tenancy in Severality

answer

sole ownership

question

Tenancy in Common

answer

two or more owners most common each owner owns a part undivided, upon death transfers to heirs can have separate deeds or just one each owner has a right to transfer his interest to anyone he chooses

question

Joint Tenancy

answer

specified ownership by more than one owner PITT - same rights of Possession, interest, made title at same time, all on same title - if any of these are missing it isn't joint tenancy Any owner may transfer ownership to anyone else but, that new owner is not joint in tenancy they are common tenants. There must be three or more owners for the other owners to keep joint tenancy in such a case.

question

Land Trust

answer

Title held by a trustee - owner retains rights Can be used to hide identity of owner

question

Limited partnership

answer

one general owner, one limited partner (no authority) but both have liability

question

General partnership

answer

all partners have authority and liability

question

S corp

answer

stockholders taxed but corp is not

question

C corp

answer

Corp is taxed, stockholders only taxed on dividends

question

LLC

answer

members taxed like a partnership

question

Condo

answer

collective ownership, own no land just airspace between the walls common elements held by tenants in common square footage is inside not out like regular realty owner has title to unit common elements taxed separately and paid by HOA

question

Regime

answer

HOA

question

Securities - Condo

answer

condos sold and put into a rental pool

question

Townhouse

answer

owner owns land and structure measure interior but assume 6" for exterior wall, 3" for shared walls

question

PUD

answer

planned unit development usually used to cluster homes closer together than would otherwise be allowed by zoning property owners usually own the land under their homes

question

Cooperative

answer

owner buys stock in the corp that owns the building and in turn receives a proprietary lease considered personal property

question

Timeshare - interval ownership

answer

...

question

Marketable Title

answer

title to real estate that is free and clear of liens and title defects

question

Insurable Title

answer

Title can be insurable but doesn't mean it is marketable

question

Cloud on title

answer

outstanding claim on title

question

Suit to Quiet title

answer

court action to settle issues on title

question

Deed

answer

transfers marketable legal title from the Grantor to the Grantee evidence of ownership Legal title passes when deed has been delivered and accepted

question

Equitable Title

answer

it is a right to get legal title at a later date ie purchase and sale contract (most common)

question

Land Contract (installment contract)

answer

buyer gets possession but owner keeps title owner financing is an example

question

General Warranty Deed

answer

most used gives possession (seizen), right to convey, no encumbrances promises further assurance that owner's heirs cannot claim and quiet enjoyment (assurance against defects in title) warranty lasts forever. Only deed that promises further assurance and quiet enjoyment.

question

Special or limited warranty deed

answer

limited to owner's time period no warranty against defects

question

Quitclaim Deed

answer

normally used to remove clouds on title no claim of ownership doesn't warrant anything

question

Tax Deed

answer

received in a tax sale 12 months after sale and previous owner has had a chance to pay taxes

question

Gift Deed

answer

transfers real estate in exchange for love and kindness

question

Easements in Gross

answer

utility easements

question

Binding agreement

answer

2 letters responding to each other is a binding agreement, but must be signed to be sued for performance.

question

4 requirements of a valid contract

answer

mutual assent - offer and acceptance. must have time, date, price, property, communication in writing legal consideration - money or something of value competent parties - no minors, sane, sober, authorized legal purpose - cannot be against public policy

question

Termination of Offers

answer

Rejection counteroffer lapse of time revocation (any period between offer and acceptance) death ALWAYS terminates on offer

question

Discharge of Contracts

answer

Performance -Yeah deal is closed! release - mutual agreement recission - usually requires law suit accord and satisfaction - substitute of terms novation - substitution of parties or terms - original party is totally released from liability assignment - substitution of parties but original party is responsible if assignee defaults statute of limiations - time limits set by law

question

Fraud

answer

misstatement -willful=fraud innocent=misstatement material fact that was considered in decision reliance resulting damage

question

Puffing

answer

exaggeration that does not rise to the level of missrepresentation does not void a contract

question

Death

answer

voids offers but not contracts

question

Breach of contract remedies

answer

liquidated damages - seller keeps earnest money suit for performance - easier to force seller to sell than buyer to buy because the property is unique

question

Option to Buy

answer

example of a unilateral contract because there is only one party making a promise Seller is promising to sell but buyer only has the option isn't committing and may assign to another. Must give valuable consideration. Once the optionee decides to buy a bilateral contract now exists.

question

Right of first refusal

answer

No benefit to seller. When owner decides to sell he must give the holder the 1st right of refusal.

question

Property management contract

answer

creates an agency relationship - OLDCAR fiduciary responsibilities establishes rights and obligations of property owner and manager management fees are usually a percentage of effective gross income

question

Non-Freehold Estates

answer

a leasehold estate created by a lease (estate and tenancy is the same word here)

question

Assigning a lease

answer

all of lessee rights are transferred (best)

question

Tenancy for years/terms

answer

a lease with a definite time period, no notice to terminate is required, expires on last day of the lease. Has full rights (CUPD) - only type of lease that has CUPD

question

Sublease

answer

only a portion of the lessee's rights transfer. Lessee bears liability.

question

Periodic tenancy

answer

stated term, requires notice to end, does not have CUPD only has CUP (does not have disposition - right to assign or sublet)

question

Tenancy at will

answer

no stated term, requires only notice to end, only has CUP not Disposition (right to assign or sublet)

question

Tenancy by sufferance

answer

a tenant holding over with permission of landlord

question

Leases/rental agreements

answer

creates a non-freehold estate.

question

distrain

answer

taking personal property as a pledge for rent

question

CUPD

answer

Control, Use, Possession, Disposition

question

demise

answer

means lease

question

abandonment

answer

unexplained absence for 15 days or more following default in rent

question

Constructive eviction

answer

landlord's actions cause the tenant to vacate and surrender possession

question

Sale of property...

answer

does not usually terminate a lease

question

Oral lease

answer

is not enforceable beyond one year

question

Net lease (net-net)

answer

taxes, insurance, maint paid for by tenant

question

Gross lease

answer

landlord pays taxes, insurance and maint

question

Protecting tenants from foreclosure act 2009

answer

protects tenants from immediate eviction upon foreclosure notice to vacate 90 days before effective date

question

Appraisal

answer

"opinion" estimate that is written and defensible of value as of a specific date. They do not determine or set the value. Market value is the purpose of most appraisals.

question

Value

answer

Always an opinion. There are many kinds: loan value, investment value, salvage value and market value.

question

Market value

answer

opinion. is the value that the typical market sees for something.

question

Value in Use

answer

value determined by its special purpose or use. Not market value

question

USPAP

answer

Uniform Standards of Professional Appraisal Practice - 1980's purpose is to se quality control standards for the valuation of real property, personal and business.

question

Elements of value

answer

DUST Demand Utility Scarcity Transferability

question

Value - Factors that influence

answer

PEPSi Physical - climate, neighbors, topography, infrastructure, condition Economic- local economy Political - zoning, taxes Social - what society is looking for

question

Methods of estimating value

answer

sales comparison replacement cost income producing capability

question

Sales comparison

answer

find at least 3 comps adjust the comps up or down to make them equal never adjust the subject property only the comps the more adjustments - not a good comp

question

Income value

answer

GRM gross rent multiplier based on monthly rental or sales for one to four family dwellings GIM gross income multiplier based on annual rental and sales used for multi-family, commercial or industrial Doesn't consider expenses

question

Capitalization

answer

operating income converted into value. income divided by rate = value

question

Economic Life

answer

depreciation life time over which property can be profitably used

question

Causes of accrued depreciation

answer

physical deterioration functional absolecence external (economic or locational) obsolence

question

Appraiser compensation

answer

is never a percentage of value estimated

question

CMA - Competitive Market Analysis

answer

what agents do. choose 3 listed, sold and expired to compare with subject property. estimate a value range

question

South Carolina Fair Housing Enforement

answer

mirrors Federal law except in enforcement. 6 months to file with SC Human Affairs Commission 1 year to file suit in state court Note that these are 1/2 the times for federal

question

Homestead exemption

answer

over 65 or 100% disabled or totally blind you get a 50,000 reduction in tax appraised (not assessed) value. Must apply for it. Must be owner occupied.

question

SC Consumer Protection Code Revision act of 1982

answer

Governs lenders. There is no mandated (usury) rate of interest. Borrower may select their own attorney, insurance and title ins. Limits assumption fees to 1% or $400 whichever is lesser. If intentionally overcharged, the borrower gets 0% interest on loan for the remainder. Fixed rate and ARMs loans cannot have a prepayment penalty.

question

SC Vacation TimeShare Act

answer

Timeshareing ownership is a freehold ownership estate. Vacation Time leasing is a leasehold estate for a # of years. Unit Week is a period that can be sold. Purchaser can cancel in writing within 5 days. Sunday doesn't count.

question

SC LLR Real Estate Commission

answer

is the enforcement agency for timesharing. Must register with LLR before offering a new timeshare project. Penalties $5000 and jail 6 months to 5 years.

question

SC Residential Property Condition Disclosure Law

answer

Property condition disclosure statement must be given before entering into a contract of sale. This governs owners. It is incumbent upon the seller to provide this. if something changes you can update form and disclose or fix the problem and act like it didn't happen! No adverse info should be hidden from buyer even if sold as is.

question

SC Residential Landlord and Tenant Act 1986

answer

Does not govern all rentals. purposed to encourage landlords and tenants to maintain and improve the quality of housing. Magistrate has jurisdiction over complaints, Circuit Court handles appeals.

question

Occupancies not subject to the Landlord and Tenant Act

answer

occupying under contract of sale frat house transient occupancy employee of landlord condo, co-op, timeshare educational residences, protective shelters

question

Essential Services

answer

water, sewer, elec, gas, hot water and heat

question

Rental Agreement

answer

all agreements, written and oral (oral only legal for 1 year)

question

Unconscionability

answer

Court may refuse to enforce the rental agreement that was unconscionable (grossly one-sided) where the landlord takes advantage of the tenant. may refuse to enforce the unconscionable pares of the lease and require the remainder to be enforced.

question

Unsigned or undelivered rental agreement

answer

valid when landlord accepts rent and tenant accepts possession

question

Tenant remedies

answer

Tenant may terminate the lease in 14 days unless landlord remedies or starts to remedy in 14 days. If tenant created the condition, cannot terminate. If terminated, tenant gets back entire deposit. If cannot posses unit, then lease ends in 5 days. If proven willful tenant may recover 3 months rent and twice damage + attorney fees. Tenant can procure services and deduct from rent, cannot fix things on their own though.

question

Retaliation from Landlord

answer

prohibited unless rent was already below market rate. He can then raise rent up to market rate. Cannot decrease essential services. Retaliation illegally costs 3 months rent or triple actual damages.

question

Landlord Remedies

answer

terminate rental agreement, recover damages + attorney fees. Must give written notice to comply within 14 days. Can enter and have work done when tenant failure involves health and safety or physical condition. Can re-rent if abandoned for 15 days past default of rent. Can dispose of possessions $500 or less.

question

Holdover tenant

answer

landlord must bring action for possession, and may recover 3 months rent or twice damages + attorney fees.

question

Distraint

answer

landlord can take possession to cover rent but tricky

question

Loan to Value

answer

determined by dividing the loan amount by the property value. loan amount/property value used all the time

question

Points/discounts

answer

discount = buying at less than face value point=1% of loan amount buying down the interest rate increases yield to the lender usually 1 pt per 1/8% reduction

question

Origination Fee

answer

fee charged by lender to cover misc expenses. usually 1/2 to 2 %

question

Mortgage Broker commissions

answer

fee paid by the borrower for finding a lender

question

Mortgage Insurance - PMI

answer

Private Mortgage Insurance = PMI Mortgage Ins Premium = MIP

question

Equity

answer

difference between the value (market value or appraisal) and the amount owed.

question

Pre-Qual or Pre-Approval

answer

Pre-qual - nothing is verified Pre-Approval some verification took place

question

Uniform Residential Loan Application

answer

Most lenders use this form.

question

Appraisal

answer

FHA/VA loan appraisals stay with the property for 6 months

question

Underwriting

answer

the IRS of lending qualifies the buyer, the property and the title

question

Servicing the load

answer

collecting payments, making sure taxes and insurance are current

question

Types of Loans

answer

Term or Straight Amortized Fixed Rate ARM Conventional (conforming and non-conforming

question

Term or Straight Loan

answer

Interest only

question

Amortized and partially amortized (balloon)

answer

level or equal payments includes interest and principal which will fully pay the entire loan Partially amortized is a balloon - must be paid all at once after a certain amount of time usually 5 or 7 years.

question

Interest structure

answer

most interest is paid in arrears and usually paid mostly up front in a mortgage

question

Fixed rate mortgage

answer

rate never changes for the life of the loan

question

ARM

answer

Index must be easy for borrow to find out what it is must not be directly influenced by the lender margin - amount lender adds to the index Adjustment interval is typically one, 3 or 5 years Most ARMs are assumable many can convert to fixed CAN have a pre-payment penalty federally but NOT in SC!

question

Payment cap

answer

can result in a negative amortization (increase the balance due)

question

ARM caps

answer

caps- adjustment period/life of the loan ie 1/5 = 1 point in 5 years

question

Conventional Loan

answer

Not gov't backed LTV ratio determines whether loan is insured or not PMI 3 types: standard conforming alternative conforming non-conforming

question

PMI

answer

Private Mortgage Insurance required if less than 20% down expires once 22% is paid down, but may be requested to terminate at 20% down Can avoid if you get a combined 1st and 2nd mortgage 80/10

question

Standard conforming conventional loan

answer

sold on the secondary market. Fannie Mae and Ginnie Mae set the guidelines to ensure uniformity. Assumable only with lender permission. Fannie Mae will NOT purchase a loan with a pre-payment penalty.

question

Non-conforming conventional loan

answer

Jumbo loans over 417,000

question

Standard conforming loan qualifying ratios

answer

28% front end/36% back end allows for 8% debt

question

Income Ratio

answer

total house payment/gross monthly income up to 28% of gross monthly income is allowed

question

Debt Ratio

answer

total house payment + long term debt/gross monthly income. up to 36% of gross monthly income is allowed *debt which will not be paid off in 10 months is long term. all revolving credit is long term.

question

Lender financing

answer

Mortgage = gives lender right to take property - equitable title Trust Deed = lender keeps title until paid in full

question

Seller Financing

answer

Purchase Money Mortgage = seller has equitable title if default Contract for Deed = seller keeps title a.k.a. bond for title, land contract, installment contract

question

Mortgagee

answer

Lender

question

Mortgagor

answer

borrower

question

Purchase money mortgage

answer

owner financing, seller does not retain title but has equitable title

question

Installment land contract (contract for deed)

answer

owner financing, owner keeps title

question

Primary Market

answer

money for consumers portfolio lender mortgage banker commercial banks savings associations mortgage broker private investors

question

Secondary market

answer

money for lenders (who they sell the loans to) Fannie Mae Ginny Mae Freddy Mac

question

Fannie Mae - FNMA

answer

Federal National Mortgage Association purchases conventional, FHA, VA loans and issues mortgage backed securities Largest purchaser in secondary market

question

Ginnie Mae - GNMA

answer

Government National Mortgage Association insurance pools of loans

question

Freddie Mac - FHLMC

answer

Federal Home Loan Mortgage Corporation only buys conventional loans insures like Ginnie Mae 2nd largest secondary purchaser

question

FHA

answer

FHA - Federal housing administration works through approved lenders requires MIP - upfront and monthly. purpose is to pump $ into FHA offers low down payment 3.5% which can come from anywhere qualifying ratios are 29/41 much more lenient than conventional Pre-payment is NOT allowed (not for any Gov't backed loans) must be owner occupied assumable with qualification FHA 203b most common

question

VA loan

answer

works through approved lenders veterans and active duty are eligible must have a certificate of eligibility by the Dept of Veterans Affairs only have to qualify with back end of 41% assumable with release of liability - novation another vet can substitute their entitlement must be owner occupied entitlement is 25% of $417,000 which is $104,250

question

Reverse Annuity - reverse mortgage

answer

bank pays owner (borrowing from equity in home) when you move or die, loan has to be paid off

question

Open-End loan

answer

secured line of credit I.E. Home Equity line of credit

question

Package Loan

answer

has real estate and personal property as collateral (package = personal property) I.E. selling a model home completely furnished

question

Blanket loan

answer

covers several pieces of property with a release for each piece builder uses this for a subdivision

question

Sale Leaseback

answer

Grantor becomes the lessee grantee becomes the lessor

question

Mortgage take-over

answer

assumption - qualified buyer -novation non-qualifying buyer is obligated to lender but seller doesn't get novation Subject to mortgage - buyer has no liability to lender, seller never gets novation

question

Wrap Around Mortgage

answer

Buyer pays seller for 1st mortgage and seller finances equity with buyer. Seller can foreclose. Loan remains in seller name. Buyer makes payments to seller Almost extinct

question

Title Theory/Lien Theory

answer

Lender has title/equitable title respectively Deed of trust (trustees)/Lien equitable title respectively SC is an lien theory state

question

Promissory Note

answer

unsecured maker=borrower payee=lender (paid the money out)

question

Security Instruments

answer

Deed of Trust (rarely used in SC) trustor=borrower trustee=third party beneficiary=lender

question

Mortgage

answer

Dead Pledge mortgagor = borrower mortgagee = lender is a contract, written, may be assigned (secondary market) priority is based on time and date

question

Hypothecation

answer

type of pledge mortgage is a type of pledge or hypothecation

question

Acceleration Clause

answer

causes entire note to be paid at once default clause - failure to keep mortgagor convenants Due on Sale clause - alienation or assumption clause

question

Mortgagor's Covenants

answer

pay ad valorem (taxes) keep insured do not remove anything attached to the house keep in good repair allow mortgagee right of entry

question

Mortgage Fraud

answer

foreclosure rescues loan modification scams unusual upfront fees Borrower falsifying documents

question

Predatory lending

answer

unfair, deceptive or fraudulent practices. Rob owners of equity, encourage refinancing for their own advantage

question

Subprime lending

answer

loans made to those who do not qualify, lenders require high rates and fees

question

Usury and Predatory lending laws

answer

usury laws make it illegal to charge high rates. SC doesn't have usury.

question

National Consumer Credit Protection Act

answer

aka Truth in lending - TIL or Regulation Z must provide the true cost of lending information APR includes interest, orig fees, points and mortgage ins do not have to disclose third party fees

question

Mortgage Disclosure Improvement Act MDIA 3-7-3

answer

good faith est within 3 days wait 7 days after providing to close the loan modifications to APR wait 3 days to close

question

Equal Credit Opportunity Act

answer

make loans available to all creditworthy borrows regardless of ... even protects marital status

question

Fair Credit Reporting Act

answer

keeps wrong info off of credit reports, gives right to inspect their file, and correct wrong info

question

Foreclosure

answer

Default is first step Equity redemption - can redeem before foreclosure Right of redemption - can redeem after auction (not in SC) Deficiency Judgments not enough money to cover mortgage

question

Distribution of Funds after Foreclosure

answer

delinquent taxes court costs plantiff mortgagee junior lien holders in the order in which they were recorded

Real Estate South Carolina Pre-license – Flashcards

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