RECA Residential Real Estate Terms Questions With Complete Solutions

General Power of Attorney - ANSWER -No limits on powers to make decisions about donors financial and legal affairs -The one exception is decisions about the donors personal affairs such as consenting to health care or deciding where the donor should reside Special Power of Attorney - ANSWER -Has specific of limited powers in regards to the donor -Also referred to as a Limited Power of Attorney Immediate Power of Attorney - ANSWER -Makes financial and legal decisions on behalf of the donor as soon as the Power of Attorney is signed, dated, and witnessed. -This type of POA terminates upon the donor's loss of mental capacity, or death. Enduring Power of Attorney - ANSWER -Makes financial and legal decisions on behalf of the donor upon the following: 1- Immediately upon it being dated, signed, and witnessed, and continues if the donor becomes incapable of his/her financial and legal affairs 2- When the donor becomes mentally incapacitated 3- When some other event specified by the donor occurs, sometimes referred to as a Springing POA. *In order for the POA to be enduring, it must state whether it is to take effect immediately and continue upon the mental incapacity or some other event stated by the donor. If it does not include such a statement, it is NOT an Enduring POA and terminates upon the donor becoming mentally incapacitated. Development Permits - ANSWER -Authorizes the location, size, and use of a building and are issued by municipalities based on the proposed development conforming to the municipal land use bylaws for that area -Permit must be obtained by builder before any residential development of any land may occur Building Permits - ANSWER -Required for the construction of new buildings Occupancy Permits - ANSWER -Part of the new residential construction process -If the inspector finds that the building meets the building and safety code requirements, the residence is approved for occupation. Remediation - ANSWER Involves reducing contamination to a level that does not impair or damage the environment or human health, or safety, or property. Manufactured Construction - ANSWER May consist of up to three sections that are complete. Modular Construction - ANSWER Involves manufacturing the 3-D units that are combined to create a cohesive look. Panelized Construction - ANSWER Involves creation of prefabricated wall, floor, or roof panels. Ground Circuit Fault Interrupter - ANSWER A type of electrical outlet that includes a test and reset button and should be installed in areas where water may come into contact with electricity. Patent Defect - ANSWER An OBVIOUS flaw that can be discovered upon reasonable inspection of the property (broken window pane, cracks in cement driveway, etc.) Latent Defects - ANSWER A defect that is not known to either the seller or the buyer at the time of the sale. These defects do NOT make the property dangerous. Material Latent Defects - ANSWER A defect that is not visible upon ordinary inspection of the property. Can be an issue that affects the value of the property OR . poses an unreasonable risk to people. Examples: flood damage, concealed crack in foundation wall, etc. Conventional Mortgage - ANSWER A loan that does not exceed 80% of the appraised value or purchase price of the property, whichever is less.