MS Real Estate PSI Exam Study Guide. 100% Coverage, rated A+

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MS Real Estate PSI Exam Study Guide. 100% Coverage, rated A+ Property Ownership -✔✔-An item that has a legal owner, along with the attendant rights to legal ownership. Real Property -✔✔-O... wnership of real estate and the bundle of rights associated with owning real estate. Personal Property -✔✔-Ownership of anything which is not real estate, and the rights associated with owning the personal property item. Chattel or Personalty -✔✔-Also known as Personal Property. Real Estate -✔✔-Air, water, land, and everything affixed to the land. Conveyance -✔✔-A voluntary transfer of real property interests. Land Characteristics -✔✔-Immobility, homogeneity, and indestructibility. Legal Descriptions -✔✔-Accurately locates and identifies the boundaries of the subject parcel to a degree acceptable by courts of law in the state where the real property is located. Legal Description -✔✔-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. Metes and Bounds -✔✔-Identifies the boundaries of a parcel of land by using reference points, distances, and angles. This description always identifies and enclosed area by starting at the point of beginning, and returning to the POB at the end of the description in order to be valid. Lot and Block -✔✔-Uses lot and block numbers referred to in a plat map filed in public records. Government Survey System -✔✔-A legal description of land using base lines, meridians, townships, sections, and ranges - also called the Rectangular Survey System Measuring structures -✔✔-Three common real property measurement methods: GBA, GLA, and ANSI. Multiply length times width. livable area -✔✔-The measurement that only includes space that you commonly use or is available for everyday use. This measurement having the smallest square footage, because you likely won't live in storage areas, hallways, or closets. Usable Area -✔✔-The total square footage the tenant occupies, including restrooms, maintenance areas, and elevators. Rentable area -✔✔-The square footage the tenant occupies, plus a portion of the buildings common area. Land Measurements -✔✔-1 section= 640 acres 1/2 section= 320 acres 1/4 section= 160 acres 1/8 section= 80 acres 1/16 section= 40 acres 1/32 section= 20 acres 1/64 section= 10 acres Mineral, water, and air rights -✔✔-Land includes minerals beneath the earths surface, water on or below the surface, and the air above the surface. Encumbrances -✔✔-When a claim/lien is made against the property. This can impact property title and the availability to transfer ownership of a property, which instead causes the property to loose value. Liens -✔✔-A creditor's claim against real or personal property as security for a property owners debt. It enables a creditor to force the sale of the property and collect proceeds as payment toward the debt. license -✔✔-An individuals personal right to use the property of another for a specific purpose. Revocable at anytime at the owner's discretion. Does not attach to the property and terminates upon death of either party. Encroachment -✔✔-An unauthorized physical intrusion of one's real property into the real property of another. Deed Restrictions -✔✔-A provision in a deed that limits or places rules on how the deeded property can be used or improved. Sole ownership -✔✔-Also known as ownership in severalty, a single party owns the fee or life estate. Joint tenancy -✔✔-Two or more people holding equal interest in a property, with the right of survivorship. Tenancy in common -✔✔-Also called estate in common, the most common form of co-ownership when the owners are not married. Tenancy by the entireties -✔✔-A form of ownership traditionally reserved for husband and wife. Owning partnership/LLC -✔✔-A form of ownership held by business partners. Common interest ownership -✔✔-When the owner of a partial interest or unit must pay for the maintenance, improvement, and insurance of common areas. Timeshares -✔✔-A fee or leasehold interest in property that is shared by owners who have use of the property at different times. Condominium -✔✔-A hybrid form of ownership of multi-unit residential or commercial properties. Combines ownership of a fee simple interest in the airspace within a unit which ownership of a undivided share, as a tenant in common. Co-op -✔✔-Ownership of shares in a cooperative association which acquires a multi-unit dwelling as it primary asset. Shareholders also receive a proprietary lease on a unit for the duration of their share of the ownership. Life estate ownership -✔✔-A freehold estate that is limited in duration to the life of the owner or there named person. On the death of this person, legal title passes to the grantor or other named party. Land Use Control and Regulation -✔✔-Regulation of how individual owners use properties in a municipality or planning district. Control patterns are usually in accordance with a master plan. Government rights in land -✔✔-Ad Valorem, Eminent domain, Police power, and Escheat Property taxes -✔✔-Ad valorem tax is annual tax levied by taxing entities according to the properties assessed value. Special Assessment -✔✔-A tax or levy customarily imposed against only those specific parcels of real estate that will benefit from a proposed public improvement like a street or sewer. Eminent Domain -✔✔-Power of a government to take private property for public use. Condemnation -✔✔-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. Escheat -✔✔-A reversionary transfer of real property to the state or county when the legal owner dies without a will and without heirs. Zoning -✔✔-A municipal land use regulation Master Plan -✔✔-An amalgamated land use plan for a municipality, county, or region which incorporates community opinion, the results of intensive research, and the various land use guidelines and regulations of the state. Acts as a blueprint for subsequent zoning ordinances and rulings. Building Codes -✔✔-A specific standard of construction or maintenance of any aspect of improved property established by local government officials. Flood zones -✔✔-Zoning may require you to build a certain distance away from the zone, and may require and elevated home. Wetlands -✔✔-Complex regulations at federal, state, and local level. Types of Hazards -✔✔-Asbestos, Carbon Monoxide, Formaldehyde, Radon, and Underground storage tanks. abatement -✔✔-A tax break offered by a state or municipality on certain types of real estate or business opportunities. Mitigation -✔✔-A loan servicer's duty to lessen the loss to the investor. Restriction on Contaminated Property -✔✔-A real property owner can be held liable for the entire cost of remediating the soil, groundwater, or indoor air contamination. A tenant can be held liable for the clean up costs as an "operator" if the tenant operations are linked to the contamination. Private controls -✔✔-Primarily implemented by deed restrictions Deed Restrictions/Conditions -✔✔-Clauses in a deed limiting the future uses of the property. Covenants -✔✔-A written agreement between two or more parties in which a party or parties pledge to perform or not perform specified acts with regard to property; usually found in such real estate documents as deeds, mortgages, leases, and contracts for deed. Restriction/condition -✔✔-A term that must be met according to a deed. Homeowners Association Regulations -✔✔-Governed and regulated by state laws Appraisal -✔✔-An opinion of value in a property developed by a professional and disinterested third party and supported by data and evidence. Purpose and use for appraisals for valuation -✔✔-Established for a clients purpose, Gives estimate property value. General Steps in Appraisal Process -✔✔-1. Identify the purpose 2. Assimilate relevant data 3. Assess the highest and best use 4. Estimate land value 5. Apply the three approaches to estimating value 6. Reconcile the values from the approaches 7. Compile the report Situations requiring an appraisal -✔✔-$1 Million dollar sale, or $500k commercial real estate transaction Effect of economic principles and property characteristics -✔✔-Demand, Supply, and Desire of the property Sales or market comparison approach -✔✔-Comparing sales prices of recently sold properties that are comparable with the subject. Cost approach -✔✔-Generally aims to estimate either the reproduction cost or the replacement cost, used for recently built homes. Income Analysis Approach -✔✔-Estimating annual net operation income from the subject property , then applying a capitalization rate to the income. Comparative/Competitive Market Analysis -✔✔-A broker or salesperson who is attempting to establish a listing price or range of prices for a property and uses a scaled-down version of the appraiser's sales comparison approach. Selecting comparables -✔✔-Resemble the subject in size, shape, design, utility, and location; generally recently sold properties. Adjusting Comparables -✔✔-The appraiser adjusts the sale prices to the comparables to account for competitive differences with the subject property. Points -✔✔-One percent of a loan amount, a lenders finance charge. LTV -✔✔-To protect against further loss, a lender will usually lend only a portion of the property's value. The relationship o fate loan amount to the property value, expressed as a percentage. Is also called the loan-to-value ratio. PMI -✔✔-Private mortgage insurance protects the lender against loss of a portion of the loan. Interest -✔✔-A lender's charge for the use of the princip [Show More]

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