Real Estate Broker Curriculum

2011

REAL ESTATE BROKER

SCOPE OF SYLLABUS

1. THE BROKER'S OFFICE-OPERATION, MANAGEMENT AND SUPERVISION - 10 HOURS

2. REAL ESTATE AGENCY DISCLOSURE (REVIEW) - 4 HOURS

3. REAL ESTATE FINANCE II - 5 HOURS

4. REAL ESTATE INVESTMENTS - 5 HOURS

5. GENERAL BUSINESS LAW - 5 HOURS

6. CONSTRUCTION & DEVELOPMENT - 4 HOURS

7. CONVEYANCE OF REAL PROPERTY & TITLE CLOSING & COSTS REVIEW) - 3 HOURS

8. REAL ESTATE PROPERTY MANAGEMENT - 5 HOURS

9. TAXES AND ASSESSMENTS - 2 HOURS

10. LOCAL CONCERNS - 2 HOURS

- Cease & Desist regulations
- Non-solicitation orders    
- Illegal entities/conversions
- rent regulations (rent control, rent stabilization)
- farm land
- forestry
- sign ordinances
- zoning
- waterfront property
- wetlands/restrictions
- environment problems in an area

Program coordinators are not limited to the above. 
They must submit an outline and learning objectives for the two hours.                             TOTAL 45 HOURS

                                                                                                                                           FINAL EXAMINATION

SUBJECT #1

THE BROKER'S OFFICE - OPERATION, MANAGEMENT AND SUPERVISION              (10 HOURS)

1.         WHO NEEDS A LICENSE AND WHY? - STRESS THE RESPONSIBILITY OF MANAGEMENT

A.        All agents, mortgage brokers, property managers, etc.  Also attorneys who sponsor agents and auctioneers.

B.        Additional licensing and/or registration

  • Banking Department for mortgage brokers and mortgage bankers
  • What steps must individuals take to qualify?

C.        Exemptions

  • Attorneys who have passed the New York State Bar exam (can attorneys receive commissions without licensure? Can attorneys be brokers and attorneys in the same transaction?)
  • Those who are employed by one person exclusively for their benefit.
  • Public officers
  • Business brokers

2.         OBTAINING A LICENSE - REVIEW OF LICENSE LAW

A.        Salesperson

  • age, education, broker sponsor, New York State examination, application

B.        Licensed real estate brokers - corporate officers, owners, partners, etc.

  • age, education, experience, New York State examinations, citizenship

C.        Licensed Associate Brokers

  • nature of licensure and qualifications

3.         MAINTAINING LICENSE

A.        Salespersons and Licensed Broker Associates

  • broker holds license; salesperson or broker associate holds pocket card
  • change in status is required to be reported to Division of Licensing Services

B.        Responsibility of Brokers

  • placement of visible sign; street sign
  • branch and main offices - notification to Division of Licensing
  • terminations
  • change of association

C.        Licensure renewal and continuing education

  • renewal - every two years
  • renewal - after expiration
  • continuing education
  • exemptions - 15 year licensees (brokers)

D.        Format of approved courses

E.        Department of State regulations

F.         Liabilities and penalties

  • Suspensions, revocations, and reprimands
    -  hearing process: complaint; determination to end or proceed; hearing
  • Impact upon licensed real estate brokers and salesperson
  • Causes for complaints to Department of State
    -  commingling funds
    -  failure to maintain property escrow accounts
    -  failure to notify Department of State of change of address, change of office location, change of agent's status
    -  failure to supervise
    -  unlicensed agents
    -  listing agreement which provide for automatic extension
    -  solicitation and non-solicitation areas
    -  failure to renew license of salesperson
    -  unauthorized practice of law
    -  collection of unearned commission
    -  requirement that broker be procuring cause
    -  procurement of a "ready, willing and able" purchaser
    -  failure to make proper disclosure (Section 443 RPL)
    -  net listings
    -  negotiating with another exclusive agent's client
    -  inducing breach of contract
    -  violations of rules regarding signs, deposits, or advertising
    -  failure to deliver duplicate copy of documents signed by consumer.
    -  failure to provide definitions of exclusive right to sell and exclusive agency
    -  failure to provide list of MLS members
    -  improper handling of deposits, good faith binders, earnest money deposits

4.         ORGANIZATION OF BROKER'S OFFICE

A.        Proprietorship
B.        Partnership
C.        Corporation
D.        Business names and trade names
E.        Franchises

5.         ANTI-TRUST LAW SECTION

A.        Three elements required

  • contract, combination or conspiracy
  • restraint of trade
  • unreasonable

B.       What are Anti-Trust Laws

  • History of the Anti-Trust Laws - Common Law Era
  • Sherman Act - July 2, 1890
  • Clayton Act - October 15, 1914 (Anti-Trust Act)
  • Creation of the Federal Trade Commission

C.        Legislative Action

  • Federal Regulatory Scheme
  • State regulatory Scheme

D.        Liability under the law

  • Federal jurisdiction
  • State jurisdiction

E.        The right of the public to sue (Class Action lawsuits)

6.         RULE OF REASON VS. PER SE ILLEGALITY

A.        Price fixing
B.        Group boycott
C.        Market allocation
D.        Tie-in arrangements

7.         ANTI-TRUST LAWS FIND THE REAL ESTATE BROKERAGE INDUSTRY

A.        Intra-state vs. Interstate Commerce (United States vs. National Association of Real Estate Boards (399 U.S. 485 (1950) "The concept of trade as used in the phrase restraint of trade encompasses the real estate brokerage business."

B.        Schedules of fixed or mandatory real estate commission or fees established by real estate boards violate the Sherman Anti-Trust Act.

C.        Anti-Trust crisis of the 1970's

  • Assistant U.S. Attorney General for Anti-Trust Richard W. McLaren (emphasis on service industries and professions) - real estate brokers, architects, accountants, etc.
  • Cases against real estate brokers, United States vs. Price George's County Board of Realtors, Inc. (Maryland:1970 WL 546 - DC. MD.) - held that recommended or suggested real estate commission schedules violate anti-trust laws
  • Consent Decrees - What are they?
  • Long Island Board of Realtors (1972) United States vs. Long Island Board of Realtors, Inc. (1972) Trade CAS 74068 (1972) WL 584 (E.D.  N.Y.)
  • United States vs. Foley 598 F. 2nd 1323 (4th Cir. 1979)
    -  lessons to be learned
    -  multitude of lawsuits - criminal anti-trust prosecutions, civil , anti-trust suit by U.S. Anti-Trust Division; Parens Patriae Suit by Maryland Attorney General

D.        Real Estate and Anti-Trust Law - What is permissible and what is not?

8.         INDEPENDENT CONTRACTOR VS. EMPLOYEE

A.        The nature of the Independent Contractor Relationship
B.        Independent Contractor vs. Employee
C.        Common Law
D.        1986 Independent Contractor Laws - New York State

  • 1986 additions to New York State Labor Law and Worker's Compensation Law
  • Internal Revenue Code Section 3508

E.        Compliance with 1986 law

  • compensation directly related to sales or other output
  • written contract between broker and salesperson
  • written contract not executed under duress

F.         Elements of Independent Contractor Relationship

  • commissions payable without deductions for taxes and directly related to output
  • no remuneration for number of hours worked
  • salespersons are permitted to work any hours they choose
  • salespersons can work from home or a broker's office
  • salespersons free to engage in outside employment
  • brokers can provide office facilities and supplies but salespeople are responsible for expenses
  • broker supervises but does not direct and control
  • either party may terminate at any time

G.        Both Federal and State Law requires a Written Contract

H.        Consequences of Non-Compliance

  • Salespersons deemed employees - broker responsible for unemployment insurance premiums,  Federal unemployment insurance, worker's compensation, disability insurance and liability for Federal and State withholding taxes including Social Security benefits
  • Consequences to Salesperson - liability to file Form 1040, Schedule C, and deduct expenses; all compensation subject to withholdings

I.          Review of recommended forms

J.         Substance over form - written documentation will not overcome Broker's direction and control of salesperson

K.        Balancing the need to supervise

L.         Department of State Regulation 175.21 - Supervision of salesperson by a broker

M.        Department of State Regulation 175.23 - Records of transaction to be maintained

N.        Implications for the future - will licensees become employees?

9.         MULTIPLE LISTING SERVICES (Benefits/Disadvantages) 

10.       INTERACTION WITH OTHER BROKERAGE FIRMS

A.        Sharing commissions

B.        Relocation companies

C.        Relocation management companies

D.        Non-Resident licensees

E.        Reciprocity

KEY TERMS

  • administrative discipline  
  • Apartment sharing agent  
  • Article 12-A   
  • Article 78 Proceeding 
  • associate real estate broker 
  • blind ad  
  • breach of contract  
  • business sign   
  • commingling  
  • consent decree  
  • disclosure 
  • earnest money deposit 
  • escrow  
  • exclusive agency     
  • exclusive right to sell 
  • exemption   
  • Federal Trade Commission/FTC  
  • felony 
  • group boycott   
  • independent contractor  
  • irrevocable consent 
  • kickback
  • license
  • market allocation agreement
  • misdemeanor
  • Multiple Listing Service/MLS
  • net listing
  • new record of association notice
  • pocket card
  • price fixing
  • real estate broker/real estate salesperson
  • reciprocity
  • revocation
  • Sherman & Clayton Anti-trust Acts
  • sponsor
  • suspension
  • tie-in arrangements
  • termination
  • termination of association notice
  • trade name
  • vicarious liability
  • violation

SUBJECT #2

REAL ESTATE AGENCY DISCLOSURE                                             (4 HOURS)

1.         THE REAL ESTATE AGENT

Who is the agent
Client or customer
Fiduciary Responsibilities
The role of a salesperson

2.         THE CREATION OF AGENCY

3.         AGENCY ALTERNATIVES

Agent
Subagent
Dual agent
seller agent
buyer agent
brokers agent

4.         VICARIOUS LIABILITY

5.         LIST AGREEMENTS

Open listing
Exclusive right to sell
Exclusive agency
Exclusive right to rent
Release from agreements

6.         AGENCY DISCLOSURE

Section 443 of the Real Property Law
Regulation 175.7
How to explain the Agency Disclosure documents
Agency Disclosure Form prior to January 1, 2011
Agency Disclosure form effective January 1, 2011

7.         COMPLETING THE SIGNATURE PAGE

When is the first substantive meeting?
Have you made your role clear?
Refusal to sign
Changing rolls

KEY TERMS

  • Acknowledgement of the Parties to the Contract
  • advance consent to dual agency
  • advance consent to dual agency with designated sales agents
  • agency disclosure form
  • broker's agent  
  • buyer's agency/agent
  • client     
  • customer
  • dual agency/agent
  • exclusive agency 
  • exclusive right to sell
  • exclusive single agency/agent
  • fiduciary
  • fiduciary duties
        accountability                                  
        confidentiality
        disclosure
        loyalty
        obedience
        reasonable care
  • first substantive contact
  • general agent
  • informed consent
  • open listing
  • principal
  • ready, willing and able buyer
  • seller's agency/agent
  • special agent
  • subagency/agent
  • termination of agency
  • undisclosed dual agency
  • vicarious liability

SUBJECT #3

REAL ESTATE FINANCE II                                 (5 HOURS)

1.         THE MORTGAGE

A.        The mortgage is the basis of all real estate financing in New York State
B.        A discussion of the mortgage origin, requirements, and types
C.        The one family home mortgage
D.        The commercial mortgage

2.         SPECIAL TYPES OF MORTGAGES

A.        Purchase money mortgage
B.        The gap mortgage
C.        The wraparound mortgage
D.        Subordinate mortgage
E.        Convertible mortgage - converting mortgage to equity
F.         The home equity loan as a second mortgage or as a first mortgage

3.         CONSTRUCTION LOANS

A.        The hardest loan to underwrite
B.        The structured payback and inspection to guarantee a good product
C.        Release land sub-division financing

4.         SALES LEASEBACK - LEASE FINANCING

A.        A discussion of the lease as a form of financing property
B.        Desire to retain land
C.        Leases (major obligations of corporation)
D.        The subordinate lease
E.        The long-term lease as a way of controlling property without buying it

5.         FHA FINANCING

A.        The development, history, and use of GNMA
B.        Mortgage money for a one family home in a capital short mortgage
C.        How to secure FHA financing

6.         ECONOMY AND HOW IT AFFECTS THE REAL ESTATE MARKET

A.        Employment
B.        Interest rates/indices
C.        Stock market
D.        Valuation/sellers
E.        Affordability /Buyers

7.         KEY TERMS BROKERS MUST UNDERSTAND TO PREDICT AND PREPARE FOR REAL ESTATE CYCLES

A.        Recession
B.        Depression
C.        Stagflation
D.        Inflation

8.         UPDATE OF LENDING POLICIES

A.        Non-income verification loans
B.        LTV (loan to value)
C.        Ratios
D.        Coops
E.        Condos
F.         Commercial property
G.        Foreclosures
H.        Programs for first-time home buyers
I.          Time it takes to process loans and how it affects buyers and sellers

 

KEY TERMS

  • acceleration clause
  • adjustable/variable rate mortgage           
  • alienation clause
  • amortization/amortized mortgage
  • balloon mortgage 
  • blanket mortgage 
  • bridge loan     
  • buydown   
  • ceiling rate/lifetime cap  
  • construction loan  
  • conventional mortgage  
  • convertible loan 
  • convertible mortgage
  • discount points 
  • disintermediation  
  • "due on sale" clause 
  • Federal Housing Administration (FHA) 
  • Federal Reserve Board  
  • gap financing  
  • ground lease 
  • home equity loan 
  • inflation 
  • interest  
  • lien theory  
  • land contract
  • mortgage insurance premium (MIP)
  • mortgagee
  • mortgagor
  • negative amortization
  • package mortgage
  • point
  • primary market
  • principal
  • private mortgage insurance (PMI)
  • purchase money mortgage
  • red-lining
  • Regulation Z
  • release clause
  • reverse annuity mortgage
  • sale leaseback
  • secondary market
  • shared appreciation mortgage
  • State of New York Mortgage Agency  (SONYMA)
  • straight/term mortgage
  • subordinate lease
  • underwriting
  • usury
  • Veterans Administration (VA)
  • wrap around mortgage

SUBJECT #4

BASIC FUNDAMENTALS OF REAL ESTATE INVESTMENTS                                 (5 HOURS)

1.         INTRODUCTION

A.        Background of industry
B.        Fundamentals of investments
C.        Statistical data

2.         INVESTMENT ANALYSIS

A.        Knowledge of operating statements
B.        Current rent roll
C.        Pro-forma schedule
D.        Valuation

3.         INVESTMENT STRATEGY

A.        Ownership planning
B.        Holdings period planning
C.        Property disposition and timing planning
D.        Available financing

4.         PROPERTY TYPE SELECTION

A.        Land acquisition and banking
B.        Retail: strip, community, neighborhood and regional malls
C.        Office - urban or suburban
D.        Apartment - rentals
E.        Mix - developments
F.         Hotels/Motels

5.         ANALYSIS PROFILE

A.        Risk/return analysis
B.        Timing
C.        Pricing
D.        Rate of return
E.        Portfolio development and securitization
F.         Sensitivity analysis
G.        Special risks
H.        Special financing

6.         TAX CONSIDERATIONS

A.        Pre-tax cash flow
B.        After tax cash flow
C.        Cash flow shelter
D.        Property exchange

KEY TERMS

  • adjusted basis
  • appreciation
  • boot
  • capital gain
  • capital loss   
  • cash flow 
  • cost recovery
  • current rent roll 
  • debt service 
  • depreciation   
  • general partner 
  • general partnership  
  • gross operating income/net operating income
  • installment sale  
  • leverage
  • limited partner
  • limited partnership
  • passive partner
  • proforma statement
  • property exchange
  • prospectus
  • rate of return
  • real estate investment trust (REIT)
  • silent partner
  • straight-line depreciation
  • syndicate
  • tax basis
  • tax depreciation
  • tax shelter
  • tax-free exchange
  • valuation

SUBJECT #5

GENERAL BUSINESS LAW                                                                      (5 HOURS)

1.         SOURCES OF LAW

A.        U.S. Constitution
B.        State Constitution
C.        Federal Laws
D.        State Laws
E.        Local Ordinances
F.         Court Decisions

2.         UNIFORM COMMERCIAL CODE

3.         NEGOTIABLE INSTRUMENTS

A.        Notes
B.        Drafts
C.        Checks
D.        Certificates of Deposit
E.        Negotiability

  • writing
  • signed
  • promise
  • specific sum
  • demand or time
  • endorsement
  • holder in due course
  • defenses

4.         BUSINESS ORGANIZATIONS

A.        Partnership
B.        Limited Partnership

- General Partnership
- Limited Partnership

C.        Corporations

- creation
- purpose
- rules
- management
- taxes
- advantages
- disadvantages
- termination and dissolution

D.      Limited Liability Corporation
          Limited Liability Partnership

5.         REAL ESTATE INVESTMENT TRUSTS

6.         PUBLIC/PRIVATE OFFERINGS

7.         FEDERAL COURT SYSTEM

Supreme
District
Specialized Courts
Bankruptcy Courts
U.S. Court of Appeals
Judicial Circuits

8.         NEW YORK COURT SYSTEM

Supreme
Court of Appeals
County
Family
Court of Claims
Small Claims Court
Small Claims (Taxation)
City, Town, Village
Appellate Division

9.         SUBSTANTIVE AND PROCEDURAL LAW

A.        Law of Agency
B.        Real Property Law
C.        Administrative Law
D.        Commercial Law
E.        Constitutional Law
F.         Law of Contracts
G.        Corporation Law
H.        Criminal Law
I.          Personal Property Law
J.         Partnership
K.        Trusts & Wills
L.         Torts - Civil Law
M.        Civil Procedures

10.       DISPUTE RESOLUTION

A.        Litigation
B.        Arbitration
C.        Mediation

11.       BANKRUPTCY

A.        Federal Proceedings
B.        Automatic Stay
C.        Procedures
D.        Bankruptcy Trustees
E.        Secured Creditor and Unsecured
F.         Claims not Discharged
G.        Discharge and dismissal

12.       ESTATES

A.        Administered by
B.        Executor

Ë          Duties

13.       ESTATES AND GIFT TAXES

A.        Federal Government
B.        New York State

14.       MARITAL

A.        Marital Property
B.        Marital Litigation

15.       STATUTE OF LIMITATIONS

A.        Contracts (commissions)
B.        Mechanics Lien

 

KEY TERMS

  • administrative law 
  • arbitration 
  • case law
  • civil law  
  • commercial law
  • condemnation  
  • constitutional law  
  • contract law 
  • corporation 
  • corporation law
  • criminal law 
  • doing business as (DBA)  
  • due process    
  • eminent domain  
  • escheat  
  • estoppel
  • executor   
  • general partnership 
  • intestate 
  • laches
  • law of agency
  • limited partnership
  • litigation
  • marital property
  • mediation
  • notice of pendency/lis pendens
  • partnership
  • personal property law
  • police power
  • real estate investment trust (REIT)
  • real property law
  • statute of frauds
  • statute of limitations
  • statutory law
  • testate
  • torts
  • trustee
  • trusts & wills
  • uniform commercial code

SUBJECT #6

CONSTRUCTION & DEVELOPMENT                                                           (4 HOURS)

1.         CONSTRUCTION STANDARDS

A.        Federal
B.        State
C.        County
D.        Local

How do each affect real estate transactions and pre-contract building and environmental inspections?

2.         LAND USE

A.        Building permits
B.        Site plan
C.        Specifications
D.        C/O
E.        Types of Zoning

-  PUD-mixed use
-  exclusionary zoning
-  non conforming use
-  spot zoning
-  historic preservation districts

F.         Transfer of development rights
G.        Eminent domain and regulatory taking
H.        Environmental Issues

3.         BUILDING INSPECTIONS AND DISCLOSURE LAWS

A.        Building inspections:

  • why?
  • when?
  • where?
  • how?
  • reports

B.        Building inspections for sellers:

  • why?
  • when?
  • how?
  • reports

C.        Disclosure laws/regulations;

  • Lead paint disclosure

D.        Why investigations by real estate brokers prior to listing of properties are important.  

discrepancies:

-           flooding
-           foundation cracks and types
-           mechanical
-           roofing

4.         SUBDIVISION

A.        Definition
B.        Determination of use

  • Town board - Zoning Ordinance
  • Planning Board - land subdivision regulations
  • wet lands regulations - Planning Board - New York State DEC
  • steep slopes and other environmental constraints - Town Codes

C.        What determines the value of land?

  • the legal permitted uses
  • the nature of the land itself
  • the location of the land
  • the available infrastructure, roads, sewer, water and power

D.        Planning board

  • how are they appointed?  how many?  how many years?
  • authority - statutory
  • subdivisions
  • site plans
  • SEQRA

E.       Zoning Board of Appeals

  • how are they appointed?  how many?  what terms?
  • what is their authority?
  • how are they helpful?
  • special permits
  • variances
  • area variances
  • use variances

5.       DEVELOPMENT PROCESS

A.        market study
B.        application
C.        environmental review
D.        marketing

6.         COSTS, FINANCING, AND ACQUISITION OF A SUBDIVISION

A.        municipal fees
B.        completion bonds
C.        development costs
D.        mortgage, construction loan
E.        owner participation
F.         lot release provision
G.        Structuring the acquisition and financing

-           is it a purchase money mortgage?
-           is it subordination?
-           is there a lot release provision?

H.        Costs of approval
 
7.         RESTRICTIVE COVENANTS

8.         DEVELOPMENT AND PURCHASE OF CONDOMINIUMS AND COOPERATIVES

A.        Requirements of filing an offering plan with the attorney general
B.        Requirements of offering plan/prospectus
C.        Purchasing a condominium
D.        The elements of a condominium
E.        The cooperative lease
F.         Financing the purchase of a cooperative
G.        Awareness of liabilities, building debt, taxes and maintenance charges on the cooperative building.  

KEY TERMS

  • ampere
  • architect
  • area and use variances  
  • basement 
  • beam   
  • blueprint   
  • British Sherman Unit (BTU) 
  • building code  
  • building permit 
  • building specifications 
  • certificate of occupancy  
  • circuit breaker
  • cluster development
  • cluster zoning
  • completion bond
  • contractor 
  • crawl space 
  • cumulative zoning  
  • deed restriction  siding
  • deed restriction/restrictive covenant 
  • defect 
  • density zoning ordinance  
  • developer
  • due diligence 
  • eave
  • engineer 
  • exclusive use zoning  
  • federal Housing Administration (FHA)
  • flashing  
  • footing 
  • fuse
  • girder
  • impact fees
  • joist
  • new construction warranty
  • non-conforming use
  • outlot
  • percolation rate
  • planned unit development
  • planning commission
  • plasterboard/sheetrock/wallboard
  • plat book
  • platform construction
  • police power
  • private land use controls
  • property condition disclosure
  • public land use controls
  • rafter
  • Real Property Law Article 9-A
  • regulatory taking
  • R-value
  • sheathing
  • sill plate
  • slab-on-ground foundation
  • special use permit
  • spot zoning
  • steep slopes
  • stud
  • subdivider
  • subdivision/subdivision regulations
  • variance
  • watts
  • wetlands
  • zoning ordinance

SUBJECT #7

CONVEYANCE OF REAL PROPERTY & TITLE CLOSING & COSTS (REVIEW)                   (3 HOURS)

1.         WHAT IS BEING CONVEYED? (TITLE)

A.        What is title and what does it encompass?
B.        "Bundle of Rights"

2.         HOW IS TITLE CONVEYED DURING GRANTOR'S LIFE?

A.        Voluntarily

  • sale - deed is the document used to convey real property
  • gift - deed (without consideration)
  • dedication - from owner to government (roads)
  • why is this done?
  • to whose advantage is it?

B.        Involuntarily

  • Legal processes
  • condemnation - the principle of taking and compensation
  • foreclosure
    -           definition
    -           what triggers a foreclosure
    -           results of a foreclosure (title to the bank or mortgages)
  • payment of debts
    -           when can this happen?
    -           defenses available
  • Natural processes
    • accretion - definition
    • avulsion - definition
    • erosion - definition

C.        Partition - definition, result affecting title to property, who can start such an action

  • referees sale

D.        Adverse possession - definition, common law justification, requirements and procedure

3.         HOW CAN PROPERTY BE CONVEYED AFTER DEATH?

A.        By use of a will (voluntarily)

  • Requirements of a valid Will

B.        If no will - by way of the Laws of Intestacy
C.        Procedures in conveyance

  •          probate - title conveyed by the executor of the estate on behalf of the estate as per the wishes expressed in the Will

D.        Rights of those to whom real property is devised via the Will

  • why is this important?
  • conveyance of title can be held up until any disputes are resolved in court (surrogate)

4.         HOW IS REAL PROPERTY CONVEYED WITHOUT A WILL?

A.        Laws of intestacy
B.        How these Laws differ from a Will
C.        Who would receive the property under these rules/laws of intestacy?
D.        How does it happen?  (e.g.) how is the real property conveyed when there is no Will?
E.        The procedures of an administration

5.         TITLE CLOSING AND COSTS (FROM SALES COURSE)

INTRODUCTION

A.        Significance of the closing: what is a title closing and why is it important to those who attend?
B.        Functions of those who will attend a closing, the importance of recording acts and what will be done at the closing.

THE TITLE CLOSING

A.        Consummation of a real estate transaction
B.        The seller is paid the balance of the purchase price
C.        Existing liens against the real property are satisfied
D.        The purchaser normally will pay the balance of the purchase price through a combination of funds obtained through an acquisition mortgage and the purchaser's own funds.
E.        Significance of:

  • deed and other closing documents
  • recording acts
  • chain of title
  • abstract of title
  • title insurance

F.       Where closing are held?
G.      A broker or salesperson's role prior to closing involves inspection of the property with the purchaser
H.      Payment of the commission
I.        Homeowner's insurance
J.       RESPA
K.      Closing statement

CLOSING COSTS AND ADJUSTMENTS

A.        Seller's closing costs

  • transfer taxes
    - state
    - local
  • broker's commission
  • attorney's fees
  • recording documents to clear title
  • satisfy existing liens
  • special
    - co-op and condo fees

B.       Purchaser's closing costs

  • appraisal and credit report fees
  • inspections
  • mortgage recording tax
  • title insurance
  • attorney's fees
  • bank fees
  • recording
  • mortgage insurance
  • special
    - co-op and condo fees

C.       Adjustments

  • real estate taxes and assessments
  • insurance
  • fuel
  • water and sewer charges
  • rent
  • security deposits
  • arithmetic of prorations

KEY TERMS

  • abstract of title 
  • accretion 
  • acknowledgment 
  • actual notice 
  • adverse possession  
  • assessments 
  • chain of title    
  • closing statement
  • condemnation 
  • consideration 
  • constructive notice 
  • constructive notice; actual notice 
  • conveyance                                                             
  • credits  
  • debits   
  • dedication 
  • delivery and acceptance
  • description
  • eminent domain 
  • erosion  
  • escheat   
  • executor
  • full warranty deed  
  • grantee   
  • grantor
  • habendum clause
  • lien foreclosure sale
  • littoral
  • lot and block
  • marketable title
  • metes and bounds
  • monuments
  • plat book
  • probate
  • proration
  • quitclaim deed
  • Real Estate Settlement Procedures Act (RESPA)
  • reconciliation
  • referee's deed
  • right of redemption
  • riparian
  • survey
  • tacking
  • testate/intestate
  • title
  • title closing
  • title insurance
  • title search
  • voluntary/involuntary alienation

SUBJECT #8          

REAL ESTATE PROPERTY MANAGEMENT                                                                                  (5 HOURS)

1.         INTRODUCTION

A.        What is property management?
B.        What are the functions of a property manager?
C.        What types of property are managed?
D.        When is a license required?

2.         THE MANAGEMENT AGREEMENT

A.        The management agreement creates an agency
B.        Property manager becomes a general agent and as such owes loyalty to the owner
C.        The management agreement is a contract and should be in writing, as well as signed and contain some or all of the following:

  • description of property
  • length of agreement
  • management authority
  • reporting
  • management fee
  • accounting responsibilities
  • insurance and risk management
  • reports
  • owners responsibility and objectives
  • how or why agreement may be terminated

3.         SKILLS REQUIRED OF A PROPERTY MANAGER

A property manager must be able to:

  • supervise others
  • understand general accounting principles (GAP), monthly and yearly reports
  • understand building systems: heating, ventilating and air conditioning (HVAC),
    structural engineering, waterproofing, plumbing, electrical, gas, oil, water, chiller
    water, security, maintenance, elevators, etc.
  • handles landlord-tenant relations; must have working knowledge of local laws
  • lease space including space planning, area design, and building layout
  • advertising and marketing
  • codes and regulations - local, state and national
  • union negotiations
  • purchasing
  • appraisal, finance, money markets, depreciation techniques, financial trends, local
    market conditions
  • general construction knowledge
  • ecology

4.         DIFFERENCES BETWEEN MARKETS

A.        Office building management
B.        Retail management
C.        Residential management
D.        Condominium and cooperatives
E.        Management office operations

5.         OBLIGATIONS TO OWNER

A.        Goals
B.        Maintenance criteria
C.        Future of the project
D.        Reporting

6.         THE MANAGEMENT FIELD

A.        How does one become a property manager?
B.        Education and designation

 

KEY TERMS

  • anchor stores          
  • capital expense 
  • capital reserve budget 
  • condominium
  • cooperative
  • corrective maintenance
  • eviction - actual/constructive 
  • fiduciary 
  • fixed expense
  • general agent  
  • lessee 
  • lessor
  • management agreement 
  • management proposal
  • operating budget
  • planned unit development
  • principal
  • preventative maintenance
  • property management
  • property management report
  • property manager
  • resident manager
  • risk management   
  • stabilized budget       
  • tenancy for years
  • variable expense

SUBJECT #9

TAXES & ASSESSMENTS                                                                                   (2 HOURS)

1.         INTRODUCTION

A.        What property is subject to assessment?
B.        What assessable property is subject to taxation?

  • Exemptions
    -  by virtue of ownership
    -  by virtue of use

2.       ASSESSMENTS

A.       By whom made?
B.       As of when?
C.       How made?

  • classification
  • approved assessing units
    -  homestead/non-homestead communities
  • tax share preservation

D.        Assessment standards - evidence

3.         PROTESTING ASSESSMENTS

A.        to whom?
B.        when?
C.        grounds?
D.        by whom?
E.        small claims protects for homeowner - occupants

4.         SPECIAL IMPROVEMENT ASSESSMENTS

A.        for what?
B.        against whom?

5.         TAX RATE FIXATION

A.        budgeting
B.        who sets the rate - how?
C.        multiple tax districts - billing

6.         ENFORCEMENT

A.        foreclosure
B.        in REM tax sale
C.        personal liability

KEY TERMS

  • ad valorem taxes 
  • appropriation 
  • assessing unit/approved assessing unit
  • assessment
  • assessment review board 
  • assessment roll 
  • assessor 
  • grievance
  • homestead/non-homestead
  • in rem
  • levy
  • lien
  • special assessment
  • tax certiorari proceeding
  • tax exemption
  • tax rate
  • taxable status date

SUBJECT #10

LOCAL CONCERNS                                                                                               (2 HOURS)

Cease and desist regulations
Non-solicitation orders
Illegal entities/conversions
rent regulations (rent control, rent stabilization)
farm land
forestry
sign ordinances
zoning issues
waterfront property
wetlands/restrictions
Environmental problems

Program coordinators are not limited to the above local concerns.  An outline and learning objectives must be submitted for this two hour subject.