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Real Estate Licensing > Chapter 2 : Property Ownership/Interests > Flashcards

Chapter 2 : Property Ownership/Interests Flashcards

1
Q

Bundle of Legal Rights

A

legal relationship between the owner and the property

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2
Q

Rights of Ownership

A 
Disposition
Enjoyment
Exclusion
Possession
Control
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3
Q

Right of Disposition:

A

to sell, will, transfer, or otherwise dispose of or encumber the property

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4
Q

Right of Enjoyment

A

to uninterrupted use of the property without interference of any third party claiming superior title

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5
Q

Right of Exclusion

A

to keep others from entering or using the property

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6
Q

Right of Control

A

Control the property and its profits within the framework of the law

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7
Q

Appurtenance

A

right or priveledge that goes with the ownership of land.

  • subsurface rights
  • air rights
  • water rights
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8
Q

Caisson

A

numerous small portions of the land’s surface purchased for a buildings foundation and supports

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9
Q

Doctrine of Riparian Rights

A

Determines the ownership of water and the adjacent land in NC.

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10
Q

Littoral Rights

A

refers to oceans and large lakes that have a tide. Appurtenant: cannot be retained when property is sold.

  • unrestricted use of water
  • own land adjacent to the water up to the mean high water mark
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11
Q

Foreshore

A

Strip of land between high tide and low tide lines. Owned by the state of NC

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12
Q

Riparian Rights

A

land along a stream, river, or lake.
(non navigable) Appurtenant: cannot be retained when property is sold.
*unrestricted use of water so long as it doesn’t hurt those up or downstream.
* owns land under the water to the exact center of the waterway.

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13
Q

Accretion

A

Land created by soil deposits

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14
Q

Reliction

A

Land aquired when water recedes or disappears.

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15
Q

Erosion

A

May cause an owner to lose land when the land is worn away by water or other natural forces.

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16
Q

Avulsion

A

Act of nature such as a flood, or avalanche that removes soil.

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17
Q

Lateral Support

A

Right to have adjacent property support the natural boundaries of the land. ie. construction or excavation of neighboring property should not cause soil on owners property to subside.

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18
Q

Subjacent Support

A

When subsurface rights are sold. Property owner is entitled to Subjacent Support from owner of subsurface rights.

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19
Q

Manufactured or Mobile home

A

Non considered REAL property until the hitch, chassis, and axels are removed and home is attached to foundation and affidavit filed by the owner.

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20
Q

Manufactured building or Modular home

A

Once assembled on homesite is considered real property

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21
Q

Total Circumstances Test: IRMA

A

Intention of Annexor
Relationship of the Annexor
Method of Annexation
Adaptation to Real Estate

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22
Q

Intention of Annexor

A

Did the person who installed the item intend it to remain permanently or to be removeable?

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23
Q

Relationship of the Annexor

A

Owner (intends permanent attachment)

Tenant (intends temporary attachment)

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24
Q

Method of Annexation

A

Permanent? Remove without damage?

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25
Q

Adaptation to Real Estate

A

Tailored? Customized ?

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26
Q

Fixtures

A

range/stove/oven, built in appliance, light fixtures, ceiling fans, attached floor coverings, blinds, shades, drapery rods and curtain rods, brackets and related hardware, window and door screens, storm windows,

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27
Q

Trade Fixtures

A
  • owned and installed by a tenant and remain tenants personal property
  • Removable before lease expires and property restored
  • Not included in the sale or mortgage of real property except by special agreement.
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28
Q

Accession

A

when a landlord aquires trade fixtures that were left.

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29
Q

Agricultural Fixtures

A

considered real property and not personal property

30
Q

Uniform Commercial Code (UCC)

A

Item in home purchased on credit with security agreement. Item remails personal property until it is paid off. Otherwise it may be removed by the issuing creditor or by seller as it is not a fixture until it is paid in full. Buy may assume debt of item.

31
Q

Estate in Land

A

The amount and kind of interest that a person has in real property.

1) non freehold estates
2) freehold estates (involve ownership)

32
Q

Freehold Estates

A 
Estates of Indeterminable length
* free simple 
* defeasible fee
* pur autre vie
* ordinary conventional life estate with   
  remainder or reversion.
33
Q

Can Pass by Inheritance

A

Free Simple
Defeasible Fee
Pur Autre Vie

34
Q

Cannot Pass by Inheritance

A

1) Ordinary Conventional Life Estate with
Remainder or Reversion
2) Marital Life Estate

35
Q

Leasehold Estates

A

Estate for Years
Estate from year to year
Estate at Will
Estate at Sufferance

36
Q

Fee Simple Estate

A

Highest type of interest in real estate recognized by law

  • potentially unlimited duration
  • estate of inheritance and always transferable
  • not always free of encumbrances
    1) Fee Simple Absolute
    2) Fee Simple Defeasible
37
Q

Fee Simple Absolute

A

no limitations other than governmental restrictions

38
Q

Fee Simple Defeasible

A

aka qualified fee estate
owner must stay qualified by obeying land restrictions imposed on estate by previous owner.
1) Fee Simple Subject to a condition subsequent
2) Fee Simple Determinable

39
Q

Fee Simple Subject to a Condition Subsequent estate

A
  • Dictates some action or activity that the new owner must not perform.
  • Former owner retains a reversionary right of re-entry and can retake possession if condition is broken (done thru court)
40
Q

Fee Simple Determinable

A

requires that a specific activity or land use continue

  • former owner retains reversionary right and can retake possession (no court needed)
  • language based on time
41
Q

Life Estate

A

aka Partial Estate- does not last forever
Freehold estate in land that is limited in duration to the life of the owner or designated persons.
* at termination the holder of the future interest (remainder or revision) with be the owner of the Fee Simple Estate

42
Q

Conventional Life Estate

A

created by grant from owner of the fee simple estate
*owner retains reversionary interest or names a remainderman that will receive Fee Simple Absolute title.
*limited to the lifetime of the owner of the life estate (life tenant)
Example man deeds property to his mom with his children remaindermen.

43
Q

Life Estate Pur Autre Vie

A

Estate for the life of another

  • life tenant owns the property
  • owned for the measuring life of some third party
44
Q

Remainder Interest

A
  • named by grantor to receive title to property
    when a life estate terminates.
  • Nonposessory Estate or future interest.
  • Can be Sold
45
Q

Reversionary Interest

A
  • Grantor does not name a remainderman and property returns to grantor when life estate terminates.
  • If grantor deceased then property goes to grantors heirs or devisees.
  • Future interest
46
Q

Life Tenant: CAN DO

A
  • True ownership interest
  • Not answerable to the holder of the future interest as long as the property is maintained.
  • Entitled to all income & profits arising from the property during the life of tenancy.
  • May use resources to maintain property.
  • Can sell or mortgage a life tenancy.
  • Must pay real estate Ad Valorem taxes and assessments
  • Must pay interest but not principal on pre- existing debt secured by the property.
47
Q

Estovers

A

A life tenants right to use property resources

48
Q

Life Tenant: CANNOT DO

A
  • Not Absolute
  • Cannot encroach on rights of the reversioner or remainderman
  • Cannot destroy or “waste” property.
49
Q

Legal Life Estate

A

*Created by statute in occurance of events
Dower
Curtesy
Homestead

50
Q

Dower

A

Life Estate that wife has in the real estate of her deceased husband.

  • Non owning spouse has a lifetime right to one half or one third interest in the real estate, even if owning spouse wills estate to others.
  • Signature of non owning spouse may be needed.
51
Q

Curtesy

A

Identical interest that a husband has in the real estate of his deceased wife.

  • Non owning spouse has a lifetime right to one half or one third interest in the real estate, even if owning spouse wills estate to others.
  • Signature of non owning spouse may be needed.
52
Q

Uniform Probate Code (UPC)

A

Surviving spouse has right to an elective share on the death of the other spouse.

53
Q

North Carolina Intestate Succession Act

A

1959

  • Provides for the distribution of the property of an intestate person, one who dies without a will.
  • allows for equal division of property among eligible heirs.
  • If no hears property goes to NC State Educational Assistance Authority.
  • Does NOT override an active survivorship clause in deed.
54
Q

Homestead

A
  • Legal life estate in real estate, occupied as the family home.
  • home or part of it is protected by most creditors during the occupants lifetime.
  • NOT protected from real estate taxes.
  • NOT protected against a mortgage for cost of improvements.
  • Family can have only ONE homestead at any given time.
55
Q

Ownership in Severalty : sole owner

A

When title to real estate is vested (presently owned by) one person or a single entity, such as a corporation, or LCC.

56
Q

Concurrent Ownership: concurrent or Co owners

A

1) Tenancy in Common
2) Joint Tenancy
3) Tenancy by Entirety

57
Q

Tenancy in Common: Concurrent Ownership

A

Undivided Interest
* unity of possession among co-owners
* not a requirement to be equal but
usually is.
Severalty- each owner can sell, convey, mortgage, or transfer interest through right of partition.
* Two or more unmarried people with no type of tenancy stipulation.

58
Q

Termination of Co Ownership by Partition Suit

A

Court my divide land into pro rata parcels

Court my order property sold and proceeds divided proportionately.

59
Q

Joint Tenancy

A

property shares are usually = with undivided possession

  • in NC presumed to be equal unless otherwise noted.
  • joint tenants must purchase together
  • all joint tenants names must be on deed.
    • RIGHT OF SURVIVORSHIP
60
Q

Right of Survivorship: Joint Tenancy of Concurrent Ownership

A
  • with death of one of the joint tenants, does not destroy the ownership unit, only reduces by one the number of people that make up the unit.
  • Upon death of one joint tenant, other tenants acquire interest of deceased till one tenant remains.
  • Not favored in NC: if a tenant dies their shares go to heirs unless otherwise noted.
61
Q

Tenancy by the Entirety of Concurrent Ownership

A

1) Owners must be husband & wife when title is received
2) Owners have rights of survivorship
3) During the Owners lives, title can be conveyed only by a deed signed by both
4) usually no right to partition

62
Q

Tenancy by the Entirety: Termination

A

By divorce: become tenants in common
By death of one spouse
By mutual agreement of both spouses

63
Q

Common Interest Community Ownership

A

Contains elements of
Ownership in Severalty
Concurrent Ownership

64
Q

Horizontal Property Acts: Condominiums

A

occupant/owner fee simple title/title to airspace

65
Q

NC Condo Act of 1986

A

Developer of property executes and records 1) declaration of condo in county
Declaration must include
* any covenants, conditions or
restrictions on use of the property.
2) Plat Map
3) By Laws

66
Q

By Laws : Condo

A
  • Created by developer
    1) creation of unit owners association giving a vote to each unit owner
    2) election of board of managers
    3) duties of board of managers
    4) compensation of its members
    5) method of election and removal
    6) managing agent to be engaged?
    7) method of collecting HOA dues.
67
Q

Consumer Protection : Condo

A
  • Developer must disclose all ownership before contract signed
  • Purchaser has seven day rescission period and can cancel and receive full refund.
  • On resale : resale certificate detailing monthly dues assessment must be disclosed.
68
Q

Cooperative Ownership

A

Title to land and building held by a cooperation

  • tenant pays for stock in corporation for an apt.
  • tenant becomes shareholder and has proprietary lease to unit for life of cooperation
  • taxes, mortgage interest, and principal plus operating and maintenance expenses are shared by tenants as monthly assessments.
69
Q

Townhouse Ownership

A
  • share party walls
  • aka Row Houses
  • Each unit individually owned
  • Tenants have HOA membership
  • HOA pays real property taxes on common
    areas only
    ** owner of townhouse unit also owns land on
    which that unit is built.
70
Q

Time Share Ownership

A

Any right to occupy a unit of real property during five or more separated time periods

71
Q

Planned Unit Development (PUD)

A

method of real estate development: not ownership.

  • flexible zoning
  • buildings may be clustered together
  • variety of land uses

Real Estate Licensing (42 decks)

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