MO Real Estate Exam Practice
2 Forms of Advertising in RE - ANS-1. institutional - sometimes called corporate advertising;
attempts to establish positive image of the company, its services and its reputation in minds of
public
2. product - directed toward particular properties a company has for sale
\3 Methods of legally describing parcels - ANS-1. Metes and Bounds * used longest
2. Rectangular Survey System (Gov't Survey Method)
3. Recorded Plat Method (lot and block system)
\5 Economic Characteristics of RE - ANS-1. Demand
2. Utility or Usefulness
3. Scarcity
4. Transferability (loans are avail and low int rates)
5. SITUS (site)= unique attractiveness
\Abstract of title - ANS-chronology of recorded owners, transfers, encumbrances
\Ad Valorem - ANS-taxies levied based on assessed value
\Addendum - ANS-Addition to contract, aka Rider
\Adhesion Contract - ANS-1 has greater bargaining advantage
\Adhesion Contract - ANS-dictated by the party who has the greater bargaining advantage
\Advertising Laws (sec 6)**** - ANS-Discrimin. Adv - illegal and violation of Federal Fair Housing
Law
- NO inducements: valuable consideration for secure customer to lease, purchase, list, sell
- Guaranteed profit: guaranteeing future profits if resale not allowed
- Co name must always appear
- Salesp contact info, equivalent brokerage info
- Blind Advertising: must include broker's reg biz name
Institutional Advertising: Advertise company or individual, not specific property
\Aleatory contract - ANS-"dependent on chance"; effects are triggered by the occurrence of a
chance event
\aleatory contract - ANS-one whose effects are triggered by the occurrence of a chance event
\Alienation - ANS-=transfer of title to real estate
written transfer= conveyance
1. Voluntary: public grant, deed, will (sale or gift)
2. Invountary: descent, escheat, foreclosure, eminent domain, adverse possession, estoppel
\Allodial System - ANS-Individual entitled to own property without proprietary control by the
king/govt (U.S. system)
Fed Reg: broad stds of real prop usage, nat disaster, land descrip, and descrim.
State Reg (*primary regulator of RE): est RE license laws and qualifications, regional influence
on usage and environemental control, ownership and inheritance
,Local: land use control, improvements, and taxation
Judicial: case law and common law applications to ownership and use
\Bill of sale - ANS-when personal property (movable in nature, "Chattel" or "Personalty") not
listed on sales contract
one of the forms licensees can use
\Branch Office Mgmt - ANS-Manager must have broker, broker salesperson, broker officer,
broker partner, or broker associate license
- salesperson may be an officer of a corporation, but not involved in management
\Branch Offices - ANS-- Broker salesperson office (NOT salesperson) can manage branch office
- branch office under a principal broker would operate under principal broker's license
\Breach of Contract
Legal Remedies - ANS-Breach of Contract (default)= failure to perform terms of agreement
Legal remedies:
-Rescission- cancels and return parties to pre contract condition (include refunds)
-Forfeiture- breaching party give up something (i.e. earnest # dep)
-Suit for Damages- sue for $ damages in civil court; liquidated damages= specified $, unliq=
contract doesn't specify amount
-Suit for specific performance- attempt to force to comply
--reformaation: to correct or modify the contract if errors
\Broker Record Keeping - ANS-Must retain true copies of records for minimum of 3 years, if not
class B misdemeanor
\Broker Reqs - Deposits / $ - ANS-Brokers must have Escrow or Trust accts unless exempted
by MREC
Deposits - broker must deposit $ w/in 10 days of accepting purchase offer
- unless other agrmt, cobroker transfer funds deposit into listing brokers escrow acct
Accounts must be NON int bearing unless otherwise agreed in writing; must clarify who receives
interest
- only negotiable items can be placed in escrow (check, cash, or money order); Seller must
agree to other items as earnest deposit (i.e. ring, boat, note, etc)
-salesperson must deliver earnest $ to broker IMMEDIATELY
-if dispute over earnest $, broker should hold $ until all parties sign a release, or within 365
days, if no agrmt, release and to state treasury
- Contract failed: AFTER 60 days broker sent registered letter saying would give earnest $ to
seller; lacking response from either party could release $ AFTER 15 DAYS
Broker has 15 days to notify buyer and seller of escrow problem
\Broker Requirements - Place of Biz - ANS-Sufficient size sign est RE office, maintain pl of biz in
state during biz hrs, supervise all salesp, same name at branch off
\Brokers License Types - ANS-- Individual: active or inactive
- corporation
, - LLC
- Partnership
- Non resident
VOIDED: expiration, suspension, revocation
\Calculating acreage of parcel - ANS-Multiply denominators of fractional descriptions together
Divide 640 by the resulting number
\Carry Over clause - ANS-legal; broker collect commission after listing over if buyer introduced
"ready willing, and able" prospective buyer to seller during listing
\Classification of Contracts - ANS-Oral v Written
Express v Implied
Bilateral v Unilateral
Executed v Executory
-executed: fully performed and fulfilled (i.e. expired lease)
-executory: performance yet to be completed (i.e. sales contract prior to closing)
\Clayton Antitrust Act of 1914 - ANS-made both substantive and procedural modifications to
federal antitrust law. Under clayton Act, private individuals permitted to sue antitrust violators. If
suites successful, individuals can recover 3x damages incurred plus court costs and attorney
fees.
FTC has power to judge whether particular trade practices are unfair. FTC can enforce
compliance with the Sherman Act and some sections of Clayton act.
\Commercial Property - ANS-Over 4 units and other income property
\Commingling/ Conversion - ANS-=doing something wrong with someone's money; i.e.
depositing late, taking out too soon, or using $ without permission
\Concurrency - ANS-Developer required to make accomodations with development project
\Condos - ANS-Buyer of unit obtains a fee simple interest in airspace of unit and a tenancy in
common interest in pro rata share of the common elements
\Consideration - ANS-Includes $ compensation, exchange of free services, or any other
valuable good or service that a person expects to be paid (Vital in license law requirement)
\Contract - ANS-=intangible agreement "mtng of hte minds"
Valid contract is legally enforceable by meeting contract law requirements: Competent parties,
mutual consent (offer & acceptance), valuable consideration, legal purpose, voluntary act of
good faith
Conveyance validity if RE: in writing, contain legal descrip, signed by 1+ (excl 1 yr lease)
\Contracts: Statute of limitations vs Statue of Frauds - ANS-Stat of Limitations: restricts time
period for injured party in contract to rescind or disaffirm; VALIDITY
Statute of Frauds: ENFORCEABILITY; certain contracts must be in writing to be enforceable
2 Forms of Advertising in RE - ANS-1. institutional - sometimes called corporate advertising;
attempts to establish positive image of the company, its services and its reputation in minds of
public
2. product - directed toward particular properties a company has for sale
\3 Methods of legally describing parcels - ANS-1. Metes and Bounds * used longest
2. Rectangular Survey System (Gov't Survey Method)
3. Recorded Plat Method (lot and block system)
\5 Economic Characteristics of RE - ANS-1. Demand
2. Utility or Usefulness
3. Scarcity
4. Transferability (loans are avail and low int rates)
5. SITUS (site)= unique attractiveness
\Abstract of title - ANS-chronology of recorded owners, transfers, encumbrances
\Ad Valorem - ANS-taxies levied based on assessed value
\Addendum - ANS-Addition to contract, aka Rider
\Adhesion Contract - ANS-1 has greater bargaining advantage
\Adhesion Contract - ANS-dictated by the party who has the greater bargaining advantage
\Advertising Laws (sec 6)**** - ANS-Discrimin. Adv - illegal and violation of Federal Fair Housing
Law
- NO inducements: valuable consideration for secure customer to lease, purchase, list, sell
- Guaranteed profit: guaranteeing future profits if resale not allowed
- Co name must always appear
- Salesp contact info, equivalent brokerage info
- Blind Advertising: must include broker's reg biz name
Institutional Advertising: Advertise company or individual, not specific property
\Aleatory contract - ANS-"dependent on chance"; effects are triggered by the occurrence of a
chance event
\aleatory contract - ANS-one whose effects are triggered by the occurrence of a chance event
\Alienation - ANS-=transfer of title to real estate
written transfer= conveyance
1. Voluntary: public grant, deed, will (sale or gift)
2. Invountary: descent, escheat, foreclosure, eminent domain, adverse possession, estoppel
\Allodial System - ANS-Individual entitled to own property without proprietary control by the
king/govt (U.S. system)
Fed Reg: broad stds of real prop usage, nat disaster, land descrip, and descrim.
State Reg (*primary regulator of RE): est RE license laws and qualifications, regional influence
on usage and environemental control, ownership and inheritance
,Local: land use control, improvements, and taxation
Judicial: case law and common law applications to ownership and use
\Bill of sale - ANS-when personal property (movable in nature, "Chattel" or "Personalty") not
listed on sales contract
one of the forms licensees can use
\Branch Office Mgmt - ANS-Manager must have broker, broker salesperson, broker officer,
broker partner, or broker associate license
- salesperson may be an officer of a corporation, but not involved in management
\Branch Offices - ANS-- Broker salesperson office (NOT salesperson) can manage branch office
- branch office under a principal broker would operate under principal broker's license
\Breach of Contract
Legal Remedies - ANS-Breach of Contract (default)= failure to perform terms of agreement
Legal remedies:
-Rescission- cancels and return parties to pre contract condition (include refunds)
-Forfeiture- breaching party give up something (i.e. earnest # dep)
-Suit for Damages- sue for $ damages in civil court; liquidated damages= specified $, unliq=
contract doesn't specify amount
-Suit for specific performance- attempt to force to comply
--reformaation: to correct or modify the contract if errors
\Broker Record Keeping - ANS-Must retain true copies of records for minimum of 3 years, if not
class B misdemeanor
\Broker Reqs - Deposits / $ - ANS-Brokers must have Escrow or Trust accts unless exempted
by MREC
Deposits - broker must deposit $ w/in 10 days of accepting purchase offer
- unless other agrmt, cobroker transfer funds deposit into listing brokers escrow acct
Accounts must be NON int bearing unless otherwise agreed in writing; must clarify who receives
interest
- only negotiable items can be placed in escrow (check, cash, or money order); Seller must
agree to other items as earnest deposit (i.e. ring, boat, note, etc)
-salesperson must deliver earnest $ to broker IMMEDIATELY
-if dispute over earnest $, broker should hold $ until all parties sign a release, or within 365
days, if no agrmt, release and to state treasury
- Contract failed: AFTER 60 days broker sent registered letter saying would give earnest $ to
seller; lacking response from either party could release $ AFTER 15 DAYS
Broker has 15 days to notify buyer and seller of escrow problem
\Broker Requirements - Place of Biz - ANS-Sufficient size sign est RE office, maintain pl of biz in
state during biz hrs, supervise all salesp, same name at branch off
\Brokers License Types - ANS-- Individual: active or inactive
- corporation
, - LLC
- Partnership
- Non resident
VOIDED: expiration, suspension, revocation
\Calculating acreage of parcel - ANS-Multiply denominators of fractional descriptions together
Divide 640 by the resulting number
\Carry Over clause - ANS-legal; broker collect commission after listing over if buyer introduced
"ready willing, and able" prospective buyer to seller during listing
\Classification of Contracts - ANS-Oral v Written
Express v Implied
Bilateral v Unilateral
Executed v Executory
-executed: fully performed and fulfilled (i.e. expired lease)
-executory: performance yet to be completed (i.e. sales contract prior to closing)
\Clayton Antitrust Act of 1914 - ANS-made both substantive and procedural modifications to
federal antitrust law. Under clayton Act, private individuals permitted to sue antitrust violators. If
suites successful, individuals can recover 3x damages incurred plus court costs and attorney
fees.
FTC has power to judge whether particular trade practices are unfair. FTC can enforce
compliance with the Sherman Act and some sections of Clayton act.
\Commercial Property - ANS-Over 4 units and other income property
\Commingling/ Conversion - ANS-=doing something wrong with someone's money; i.e.
depositing late, taking out too soon, or using $ without permission
\Concurrency - ANS-Developer required to make accomodations with development project
\Condos - ANS-Buyer of unit obtains a fee simple interest in airspace of unit and a tenancy in
common interest in pro rata share of the common elements
\Consideration - ANS-Includes $ compensation, exchange of free services, or any other
valuable good or service that a person expects to be paid (Vital in license law requirement)
\Contract - ANS-=intangible agreement "mtng of hte minds"
Valid contract is legally enforceable by meeting contract law requirements: Competent parties,
mutual consent (offer & acceptance), valuable consideration, legal purpose, voluntary act of
good faith
Conveyance validity if RE: in writing, contain legal descrip, signed by 1+ (excl 1 yr lease)
\Contracts: Statute of limitations vs Statue of Frauds - ANS-Stat of Limitations: restricts time
period for injured party in contract to rescind or disaffirm; VALIDITY
Statute of Frauds: ENFORCEABILITY; certain contracts must be in writing to be enforceable
