AceableAgent Real Estate Principals 2 Exam Questions and Answers Latest Updated
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AceableAgent Real Estate Principals 2
Institution
AceableAgent Real Estate Principals 2
Specific Data - ANSWER-Is information regarding the property itself.
Principle if Anticipation - ANSWER-The idea that the present value of a property is affected by the ANTICIPATED income or utility that property will give its property owner.
Principle of Contribution - ANSWER-The idea that a...
AceableAgent Real Estate Principals 2
Exam Questions and Answers Latest
Updated
General Data - ANSWER-Is information about a property's location. This could include
the city, region, and neighborhood in which the poperty uis situated.
Specific Data - ANSWER-Is information regarding the property itself.
Principle if Anticipation - ANSWER-The idea that the present value of a property is
affected by the ANTICIPATED income or utility that property will give its property owner.
Principle of Contribution - ANSWER-The idea that a property's overall value is made up
of the combined value of each of its parts. But the CONTRIBUTORY value of an item is
not always equal to the price of that item.
Principle of Substitution - ANSWER-States that the value of something is affected by
the cost of getting a similar (substitute) item elsewhere.
Principle of Change - ANSWER-Reminds us that the the condition of a property, the
desirability of its location, and the market in which it exists can always change, which
could affect the value of the property.
Principles of Supply and Demand - ANSWER-States that when supply is low and
demand is high, prices will increase. And if supply is plentiful and demand is low? Prices
will then drop.
Principle of Conformity - ANSWER-Claims that maximum value is realized when land
use is in harmony with surrounding standards.
Principles of Regression and Progression - ANSWER-States that the presence of higher
value or lower homes near the subject property can change its value.
DUST - ANSWER-Is a acronym to help us remember the four characteristics that make
real estate valuable: Demand, Utility, Scarcity and Transferability.
Demand - ANSWER-If there are multiple buyers interested in a property, the property
with increase in value.
Utility - ANSWER-Properties need to be useful or serve some kind of purpose in order
to have value to a buyer. An empty lot, for example, may not look like it has much utility,
but to a buyer who wants to build a custom home in that area, it's quite useful.
,Scarcity - ANSWER-If the amount of housing in an area is low in supply, it grows in
value.
Transferability - ANSWER-Whether it's government rules or a title issue, anything that
limits the transferability of real estate makes it less valuable.
Appraisal Report - ANSWER-A REPORT from a licensed appraiser that's sums up a
property's market value based on collected data. The lender usually asks for this during
the mortgage origination process.*
The Buyer - ANSWER-The appraisal report is usually paid by...
The Lender - ANSWER-The appraiser that will complete the appraisal report is usually
chosen by...
*After a buyers offer is accepted and the LENDER is trying to give the buyer final
approval.
Appraisal Review - ANSWER-To double-check the accuracy of the appraisal.
Conducted by another professional (either an independent or in-house specialist).
Market Value - ANSWER-Is the price for which a property will sell if offered openly
under normal conditions. (All about the present)
Depreciation - ANSWER-The lose of value because of obsolescence (becoming
obsolete) or deterioration.
Effective Age - ANSWER-An estimated age that is influenced by the updates and
quality of maintenance of the property.
Comparative Market Analysis (CMA) - ANSWER-Uses information regarding recently
sold homes in the area to arrive at an indication of what the fair market value of a similar
property would be.
Sales Comparison Approach (or Direct Sales Comparison) - ANSWER-An appraiser
collects data from the previous sales of similar properties in the area with similar
features: amenities, square footage, number of rooms, and location.
*Also known as Market Data Approach.
*An appraiser gathers at least three comparison sales, or comparables.
*Used mostly for owner-occupied residential property and vacant land.
Cost Approach - ANSWER-An appraiser needs to estimate the current costs of
reconstructing the property with improvements (the replacement cost). This estimate is
added to the value of the land, and then depreciation of the home since it was first built
is subtracted.
*Used mostly for new construction.
, Quantity Survey Method - ANSWER-The appraiser tallies the value of everything that
goes into the cost.
*Method used for determining value within the cost approach.
Unit-In-Place Method - ANSWER-Takes direct and indirect costs into account,
combines them into a simplified cost for a building component.
*Method used for determining value within the cost approach.
Square Foot Method - ANSWER-The appraiser estimates a cost per square foot for that
specific type of building and multiplies it by the square footage of the structure.
*Method used for determining value within the cost approach.
Income Approach - ANSWER-Determines the amount of income the property could
make over a year and references the sale of other rental properties in the area.
*Used mostly for commercial properties.
Primary Mortgage Market - ANSWER-Where borrowers and lenders negotiate loan
terms of a mortgage transaction.
Mortgage-Backed Securities - ANSWER-Bundles of loans that are purchased from
Leanders by holding warehouse agencies, only to be repackaged and resold to
investors, are known as...
Balloon Payment Loan - ANSWER-The most notable feature of a ___ ___ ___ is that
the final payment is larger than the others.
Amortized Loan - ANSWER-By the end of the term of an ___ ___, the full amount of the
principal and all interest due will be reduced to zero.
PITI - ANSWER-Is the abbreviation used for the four components of a monthly
mortgage payment.
Predatory Lending - ANSWER-Deceptive and questionable practices by lenders to
entice a borrower to assume a mortgage loan would be considered...
VA Loan - ANSWER-A ___ ___ is a guaranteed mortgage loan available to eligible
veterans and their spouses to purchase or construct homes.
Federal Reserve System - ANSWER-Twelve FEDERAL RESERVE districts, each
served by a FEDERAL RESERVE bank, make up the....
RESPA (Real Estate Settlement Procedures Act) - ANSWER-Is a consumer protection
statute that aims to help educate consumers about closing and settlement services.
*It protects from abusive leading practices.
*Is enforced by the CFPB (Consumer Financial Protection Bureau).
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