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Arkansas Real Estate Chapter 4
Primer for Exam Chapter 4
76
Real Estate & Planning
Undergraduate 1
07/13/2014

Additional Real Estate & Planning Flashcards

 


 

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Term
Police Powers
Definition
Power of the state to enact laws
Term
Eminent Domain
Definition
right of the government to acquire privately owned real estate for public use
Term
Condemnation
Definition
the process the government uses to exercise the right of eminent domain
Term
Taxation
Definition
a government charge on real estate to raise funds
Term
Escheat
Definition
the transfer of ownership of property to the government when a person dies without heirs or a will to direct the disbursement of property
Term
WYPS
Definition

Acronymn for the four kinds of tenancy:

 

will

years

periodic

sufferage

Term
Tenancy
Definition

     (1.) holding of lands, by any kind of title

     (2.) a mode of holding an estate in property

     (3.) a form of ownership of property

     (4.) a temporary possession or occupancy of property             (lease) belonging to another

Term
Tenancy at Will
Definition
leasehold tenancy where either the landlord or the tenant may terminate by giving reasonable notice
Term
Tenancy for Years
Definition
A tenancy for a specific period of time
Term
Periodic Tenancy
Definition
Estate existing for some period of time determined by the term of the payment of rent
Term
PETE
Definition

4 Government Powers

 

Police Powers

Eminent Domain

Taxation

Escheat

Term
Enabling Acts
Definition
the state's authority passed on to municipalities and counties
Term
Estate
Definition
Whatever hold you have in property
Term
Non-freehold
Definition
Leasehold
Term
Tenancy at Sufferance
Definition
tenant remains in possession of property after the end of the lease until the tenant is evicted or leaves of free will
Term
Fixed Term Tenancy
Definition

Tenancy for Years

 

 

Term
Surrender of Lease
Definition
Leaving tenancy for years before the lease is fulfilled by the tenant
Term
Constructive Eviction
Definition
The act of a landlord doing something or failing to do something they are legally bound to do thus rendering the property uninhabitable to encourage the tenant to leave
Term
Freehold Estate
Definition
Ownership rights to land that are not part of a lease
Term
Three types of Freehold Estates
Definition

     (1.) fee simple

     (2.) life estate

     (3.) fee tail

Term
Fee Simple
Definition
own estate for life and transferable to heirs
Term
Grantor
Definition
Same as Seller
Term
Grantee
Definition
Same as buyer
Term
Life Estate
Definition
ownership is limited to the duration of grantee / some person's lifetime
Term
Life estate pur autre vie
Definition
term of estate depends on the life of a person other than the life of the tenant
Term
Reversionary Interest
Definition
Property reverts back to the original grantor at the end of the life estate
Term
Remainderman
Definition
Any person other than the original grantor who has been given the reversionary interest
Term
Dower
Definition
life estate created for a wife
Term
Curtesy
Definition
life estate created for the husband
Term
Legal Life Estate
Definition
Life Estate established by the state
Term
3 kinds of Legal Life Estates
Definition

     (1.) Dower

     (2.) Curtesy

     (3.) Homestead Exemption

Term
Are marital life estates inheritable
Definition
No
Term
Homestead
Definition
Protects family against creditors as long as you live in the house.  Only one homestead per family at a time
Term
Fee tail / "heirs of the body"
Definition
lasts as long a a person's descendants' live, generation after generation.
Term
Four Types of Fee Simple Estates
Definition

     (1.) fee simple absolute

     (2.) fee simple determinable

     (3.) fee simple subject to condition subsequent

     (4.) fee simple subject to executory limitation

Term
Indefeasible Estate
Definition
transfer of property without conditions
Term
Fee Simple Absolute
Definition
No qualification or restriction on the estate
Term
Three phrases that create a fee simple absolute
Definition

(1.) to "x"

(2.) to "x and heirs"

(3.) to "x in fee simple"

Term
Fee Simple Determinable
Definition
Automatically reverts to grantor
Term
Defeasible Estates
Definition
transfers to grantee based on conditions
Term
Fee simple subject to condition subsequent
Definition
subject to future conditions
Term
Fee simple subject to executory limitation
Definition
Has a condition placed on it in favor of a new Grantee rather than the Grantor
Term
Ownership in severalty
Definition
owned by a single person or legal entity
Term
Concurrent Estates
Definition

Tenancy in Common, Joint Tenancy, Tenancy by the Entirety, and Community Property

 

Property is owned by more than one person or entity

Term
Tenancy in Common
Definition

concurrent owners own a fractional interest in the property

 

When division is not stated, it is considered equal: i.e., four concurrent owners would be 25% each

Term
Is Tenancy in Common Inheritable?
Definition
Yes
Term
Joint Tenancy
Definition
tenants have undivided interest with right of survivorship meaning that "partners" get the property as the other tenants die
Term
4 unities required to create a joint tenancy
Definition

P - I - T - T

 

possession, equal rights to possession

 interest, joint tenants must be equal

time, tenants must obtain interests at the same time

title, obtain interests on the same dead

Term
Can a "joint tenant" owner sell their ownership?
Definition
Only by permission of all others
Term
Tenancy by the Entirety
Definition
tenancy for married couples
Term
Can Tenancy by the Entirety interests be conveyed by an individual?
Definition
Only with permission of the other spouce.
Term
Community Property
Definition

Property owned before marriage stays property of the individual 

 

Property acquired after the marriage is "ours" or community property

Term
Trust
Definition
legal instrument created when the owner of the property (trustor), transfers assests to the trust
Term
Living Trust / inter vivos trust
Definition

created by the trustor during their lifetime giving them control of the assests until they die at which time they pass directly to the beneficiaries 

 

 

Term
In a Living Trust, may the Trustor also be the Trustee
Definition
Yes
Term
Goals of Living Trust
Definition

     (1.) avoid the cost and delay associated with probate

     (2.) provide for automatic transfer of property when               the owner dies

     (3.) provide for management of trust if the                             owner/trustor/trustee becomes incapacitated 

Term
Testamentary Trust
Definition
Created by a will upon the death of the Trustor
Term
Land Trust
Definition

Contains only land

Trustor benefits as long as they live

Usually termed for 20 years or more

Trustee may resign and convey title to beneficiary at any time

 

Term
Lein Theory States
Definition
States that use Mortgages to secure land loans
Term
Real Estate Investment Trust / REIT
Definition
Business Organization created by Congress
Term
5 requirements of REIT
Definition

     (1.) minimum of 100 investors

     (2.) no fewer than 5 investors may own more than                  50%

     (3.) 95 % of gross income must be derived from                     investment income

     (4.) 75% of trust's gross income must come from real             estate

     (5.) 95% of net income must be distributed in the year             earned

Term
Condominum
Definition
owners own their own unit and a share of the common elements
Term
Cooperatives
Definition

Tenants own shares of stock in the corporation and have a long-term lease (proprietary lease) to occupy a unit in the building

 

Governed by an elected board

 

stock holders must give other coop members first right of refusal 

Term
Time-sharing
Definition
right to own or lease a specified time interval in a properity
Term
Time-share Estate
Definition
A fee simple interest is purchased which allows the owner to own the unit for the same time period each year in perpetuity.
Term
Time -share Use
Definition
The right to use the property for the same time period each for a certain number of years.  After that period / number of years, any rights held by the owner end.
Term
Partnerships
Definition

Generally cannot own real estate but Arkansas allows it

 

Each partner has unlimited liability

Term
General Partnership
Definition

Partners have right to participate in the management

Partners have unlimited liability

Term
Limited Partnership
Definition

Includes at least one general partner

and

one or more limited partners

 

General partner controls and is liable 

Limited partners are only liable to the extent of their investment

Term
Real Estate Syndicate
Definition
Two or more people or businesses pool their money to invest in real estate
Term
Joint Venture
Definition
Created for a specific purpose for a definite time
Term
Corporation
Definition

Artifical person

may hold title to real estate

Shareholds are liable to the extent of their investment

Term
S Corporation
Definition

Limited to 100 stockholders

profits and losses are passed on to the stockholders

President or Secretary usually may legally transfer titles 

Term
Limited Liability Company LLC
Definition

Have benefits of C & S

 

avoid double taxation

reduced liability to stockholders

avoid cumbersome administrative procedures; i.e., shareholders' meeing and publishing minutes of the corp

 

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