CAI EXAM FLASHCARDS | 379 QUESTIONS AND
ANSWERS | 2026 UPDATE | WITH COMPLETE
SOLUTION
Community Association Answer - 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? Answer
- 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? Answer - 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? Answer - 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? Answer - 1.
Planned Community
2. Condominium
3. Cooperative
What is a planned community? Answer - 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? Answer - 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? Answer - 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? Answer - defines the
member or stockholder's rights and obligations in relation to the living unit.
The 3 types of residential community associations can exist by themselves or
they can be grouped in clusters called: Answer - 1. Master or umbrella
associations
2. Mixed-use developments
3. "55 and Older" Communities
,What is a Master or Umbrella Association? Answer - A master or umbrella
association consists of more than one residential community association.
What is a Mixed-Use Development? Answer - A mixed-use development
usually consists of a mixture of residential and commercial and/or industrial
uses group together. Their marketing slogan is often "live, work, play".
What is a "55 and Older" Community? Answer - Must have one person who is
55 years of age or older living in at least 80% of its occupied units.
What is the Equal Employment Opportunity Commission (EEOC)? Answer - The
federal government prohibits discrimination against otherwise qualified people
in hiring, promotion, dismissal, compensation, and working conditions based
on specific personal characteristics including:
-race and ethnicity
-color
-national origin
-age
-gender
-religion
-pregnancy
-disability
What is the Fair Debt Collection Practices Act (FDCPA)? Answer - The purpose
of the FDCPA is to protect debtors from unscrupulous debt collectors and to
impose a consistent and fair method to collect debts.
What is the Fair Labor and Standards Act (FSLA)? Answer - FLSA dictates
standards for the basic minimum wage and overtime pay. It affects most
private and public employment. It requires employers to pay covered
, employees who are not otherwise exempt at least the federal minimum wage
and overtime pay of one-and-one-half-times the regular rate of pay. Some
states have higher basic minimum wage amounts.
What is the Family and Medical Leave Act (FMLA)? Answer - Administered by
the Wage and Hour Division of the Department of Labor, FMLA requires
employers of 50 or more employees to provide up to 12 weeks of unpaid, job-
protected leave to eligible employees for the birth or adoption of a child or for
the serious illness of the employee or a spouse, child, or parent.
What is the Federal Insurance Contributions Act (FICA)? Answer - This act
requires employers and employees to make matching contributions to Social
Security. The employer must withhold the employee's share of the tax from his
or her wages or salary and pay it timely to the federal government.
What is the Occupational Safety and Health Act (OSHA)? Answer - OSHA's
mission is to "prevent injuries and protect the health of America's workers by
ensuring safe and healthful workplaces". Some OSHA requirements include:
-specific working conditions
-
What is the Soldiers' and Sailors' Civil Relief Act of 1940? (SSCRA) Answer -
SSCRA impacts American forces on active duty by requiring the delay of all civil
court actions, such as bankruptcy or foreclosure, until the service member
returns from active duty. SSCRA also protects active service members'
dependents from being evicted if the rent does not exceed $1,200 per month
by requiring the landlord to obtain a court order authorizing eviction.
What is the U.S. Bankruptcy Code? Answer - The purpose of this law is to help
honest people and businesses find a way to pay their debt or get a fresh law.
These laws help people who can no longer pay their creditors start anew -- by
liquidating assets to pay their debts or by creating a repayment plan.
ANSWERS | 2026 UPDATE | WITH COMPLETE
SOLUTION
Community Association Answer - 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? Answer
- 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? Answer - 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? Answer - 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? Answer - 1.
Planned Community
2. Condominium
3. Cooperative
What is a planned community? Answer - 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? Answer - 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? Answer - 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? Answer - defines the
member or stockholder's rights and obligations in relation to the living unit.
The 3 types of residential community associations can exist by themselves or
they can be grouped in clusters called: Answer - 1. Master or umbrella
associations
2. Mixed-use developments
3. "55 and Older" Communities
,What is a Master or Umbrella Association? Answer - A master or umbrella
association consists of more than one residential community association.
What is a Mixed-Use Development? Answer - A mixed-use development
usually consists of a mixture of residential and commercial and/or industrial
uses group together. Their marketing slogan is often "live, work, play".
What is a "55 and Older" Community? Answer - Must have one person who is
55 years of age or older living in at least 80% of its occupied units.
What is the Equal Employment Opportunity Commission (EEOC)? Answer - The
federal government prohibits discrimination against otherwise qualified people
in hiring, promotion, dismissal, compensation, and working conditions based
on specific personal characteristics including:
-race and ethnicity
-color
-national origin
-age
-gender
-religion
-pregnancy
-disability
What is the Fair Debt Collection Practices Act (FDCPA)? Answer - The purpose
of the FDCPA is to protect debtors from unscrupulous debt collectors and to
impose a consistent and fair method to collect debts.
What is the Fair Labor and Standards Act (FSLA)? Answer - FLSA dictates
standards for the basic minimum wage and overtime pay. It affects most
private and public employment. It requires employers to pay covered
, employees who are not otherwise exempt at least the federal minimum wage
and overtime pay of one-and-one-half-times the regular rate of pay. Some
states have higher basic minimum wage amounts.
What is the Family and Medical Leave Act (FMLA)? Answer - Administered by
the Wage and Hour Division of the Department of Labor, FMLA requires
employers of 50 or more employees to provide up to 12 weeks of unpaid, job-
protected leave to eligible employees for the birth or adoption of a child or for
the serious illness of the employee or a spouse, child, or parent.
What is the Federal Insurance Contributions Act (FICA)? Answer - This act
requires employers and employees to make matching contributions to Social
Security. The employer must withhold the employee's share of the tax from his
or her wages or salary and pay it timely to the federal government.
What is the Occupational Safety and Health Act (OSHA)? Answer - OSHA's
mission is to "prevent injuries and protect the health of America's workers by
ensuring safe and healthful workplaces". Some OSHA requirements include:
-specific working conditions
-
What is the Soldiers' and Sailors' Civil Relief Act of 1940? (SSCRA) Answer -
SSCRA impacts American forces on active duty by requiring the delay of all civil
court actions, such as bankruptcy or foreclosure, until the service member
returns from active duty. SSCRA also protects active service members'
dependents from being evicted if the rent does not exceed $1,200 per month
by requiring the landlord to obtain a court order authorizing eviction.
What is the U.S. Bankruptcy Code? Answer - The purpose of this law is to help
honest people and businesses find a way to pay their debt or get a fresh law.
These laws help people who can no longer pay their creditors start anew -- by
liquidating assets to pay their debts or by creating a repayment plan.
