Latest CAI Exam Flashcards with 100% Correct Answers

Latest CAI Exam Flashcards with 100% Correct Answers Community Association *Ans* legal entity in which the owners enjoy the protection, enhancement, maintenance and preservation of their homes and property. What're the three defining characteristics of community associations? *Ans* 1. Membership in the community association is mandatory and automatic for all owners 2. Certain association governing documents bind the owner and the association to each other through mandated actions. 3. Mandatory lien-based assessments (maintenance fees) are levied on each owner in order to operate and maintain the community association. What is a lien? *Ans* legal claim by one party (community association) on the property of another (delinquent owner) to obtain the payment of a debt or the satisfaction of an obligation. What is the primary purpose of a community association? *Ans* Purpose is to provide for the community, business, and governance aspects of the association. This is done by administering, maintaining, and enhancing a residential real estate development, and through the establishment of a system of property rights, binding covenants and restrictions, and rules and regulations. What're the 3 types of basic residential community associations? *Ans* 1. Planned Community 2. Condominium 3. Cooperative What is a planned community? *Ans* Owner owns his or her own long and/or living unit The community owns any common areas, such as tennis courts and roads for the use and benefit of the lot owners. What is a condominium? *Ans* The individual owns his or her living unit and an undivided interest in the common elements of the community. Each owner owns a percentage of the common elements - which consist of everything except the living units, ex. pool or lobby. The community association itself owns no real estate as an association. What is a cooperative association? *Ans* An individual owns stock or membership in the cooperative and holds a proprietary lease or occupancy agreement for his or her living unit. What is a proprietary lease or occupancy agreement? *Ans* defines the member or stockholder's rights and obligations in relation to the living unit.