Washington State Real Estate Exam

Washington State Real Estate Exam Abandonment The voluntary and permanent cessation of use or enjoyment with no intention to resume or reclaim one's possession or interest. May pertain to an easement or a property. Abrogation Tenants cannot sign away their rights in advance of signing the lease. Abstract of Title A condensed version of the history of title to a particular parcel of real estate as recorded in the county clerk's records; consists of a summary of the original grant and all subsequent conveyances and encumbrances affecting the property. Abutting The joining, reaching, or touching of adjoining land. Abutting parcels of land have a common boundary. Accelerated Depreciation A method of calculating for tax purposes the depreciation of income property at a faster rat than would be achieved using the straight-line method. Note** any depreciation taken in excess of that which would be claimed using the straight-line rate is subject to recapture as ordinary income to the extent of gain resulting from the sale. Acceleration Clause A provision in a written mortgage, note, bond, or conditional sales contract that, in the event of a default, the whole amount of principal and interest may be declared to be due an payable at once. Accretion An increase or addition to land by the deposit of sand or soil washed up naturally from a river lake or sea. Accrued Depreciation The actual depreciation that has occurred to a property at any given date; the difference between the cost of replacement new (as of the date of appraisal) and the present appraised value. Acknowledgment A declaration made by a person to a notary public, or other public official authorized to take acknowledgments that an instrument was executed by that person as a free and voluntary act. Actual Eviction The result of legal action originated by a lessor, whereby a defaulted tenant is physically ousted from the rented property pursuant to a court order. Actual Notice Express information or fact; that which is know; actual knowledge. Adjustable-rate Mortgage A mortgage in which the interest rate changes at predetermined intervals. The mortgage has caps, or a ceiling, that limits the amount it can change at the predetermined intervals. Administrator The party appointed by the county court to settle the estate of a deceased person who died without leaving a will. Ad Valorem Tax A tax levied according to value; generally used to refer to real estate tax. Also called the general tax. Adverse possession The right of an occupant of land to acquire title against the real owner, where possession has been actual, continuous, hostile, visible, and distinct for the statutory period. Affidavit A written statement signed and sworn to before a person authorized to administer an oath. Agent One who represents or has the power to act for another person (called the principal). The authorization may be express or implied. A fiduciary relationship is created under the law of agency when a property owner, as the principal, executes a listing agreement or management contract authorizing a licensed real estate broker to be the owner's agent. Agreement of sale A written agreement whereby the purchaser agrees to buy certain real estate and the seller agrees to sell, upon terms and conditions set forth in the agreement. Air Lot A designated airspace over a piece of land. Air lots, like surgace property, may be transferred. Air Rights The right to use the open space above a property, generally allowing the surface to be used for another purpose. Alienation The act of transferring property to another. Alienation may be voluntary, such as by gift or sale; or involuntary, such as through eminent domain or adverse possession. Alienation Clause The clause in a mortgage or deed of trst that states that the balance of the secured debt becomes immediately due and payable at the mortgagee's option if the property is sold by the mortgagor. In effect, this clause prevents the mortgagor from assigning the debt without the mortgagee's approval. Alluvion New deposits of soil as the result of accretion. Amenitites The tangible and intangible features that increase the value or desirability of real estate. Americans with Disabilities Act (ADA) A federal law that became effective in 1992. It is designed to eliminate the discrimination against individuals with disabilities by mandating equal access to jobs, public accommodations, public transportation, telecommunications and government services. Amortization The liquidation of a financial burden by installment payments. Amortized Loan A loan in which the principal, as well as the interest, is payable in monthly or other periodic installments over the term of the loan. Antitrust Laws The laws designed to preserve the free enterprise of the open marketplace by making illegal certain private conspiracies and combinations formed to minimize competition. Violations of antitrust laws in the real estate business generally involve either price fixing (brokers conspiring to set fixed compensation rates) or allocation of customers or markets (brokers agreeing to limit their areas of trade or dealing to certain areas or properties). Appraisal An estimate of the quantity, quality, or value of something. The process through which conclusions of property value are obtained; also refers to the report setting forth the process of estimation and conclusion of value. Appraised Value An estimate of a property's present worth. Appreciation An increase in the worth or value of a property due to economic or related causes that may prove to be either temporary or permanent; opposite of depreciation. Appurenant Belonging to; incident to. Ex: a garage is appurtenant to a house. The common interest in the common elements of a condominium is appurtenant to each apartment. Arbitration A means of settling a controversy between two parties through the medium of an impartial third party whose decision on the controversy (it is agreed) will be final and binding. Assemblage The process of merging two or more parcels of real estate to create one parcel. Assessment The imposition of a tax, charge, or levy, usually according to established rates. Assignment The transfer in writing of rights or interest in a bond, mortgage, lease, or other instrument. Assumption of Mortgage The transfer of title to property to a grantee wherein he assumes liability for payment of an existing note secured by a mortgage against the property. Should the mortgage b foreclosed and the property sold for a lesser amount than that due, the grantee-purchaser who has assumed and agreed to pay the debt secured by the mortgage is personally liable for the deficiency. Before a seller may be relieved of liability under the existing mortgage, the lender must accept the transfer of liability for payment of the note.