Essentials of New Jersey Real Estate

by Lank, Edith; Sobeck, Joan M.

• ISBN13: 9780793135998
• ISBN10: 0793135990
• Edition: 4th
• Format: Paperback
• Copyright: 2000-01-01
• Publisher: Dearborn Trade

Summary

Both conprehensive an up to date, this text provides an easy to understand overview of New Jersey real estate and contains all the necessary materials to teach a top notch licensing class.Highlights include: * "Getting Started in Real Estate" Appendix in Chapter 1 provides practical information for a career in real estate. * Complete reprint of the "New Jersey License Act and the state commission rules and regulations.

Table of Contents

Preface	ix
About the Authors	x
Acknowledgments	xi
Real Estate Licensing	1	(7)
Key Terms	1	(1)
Who Must Be Licensed	1	(1)
Real Estate Commission	1	(1)
Real Estate Licenses	1	(3)
Classes of Licenses	1	(1)
Activities Covered	2	(1)
Exemptions	2	(1)
Payment for Services	2	(1)
License Qualifications	2	(2)
Guaranty Fund	4	(1)
Interstate Property	4	(1)
Rental Referral Agencies	4	(1)
Summary	4	(1)
Key Terms Review	5	(1)
Review Questions	5	(3)
Commission Rules and Regulations	8	(8)
Key Terms	8	(1)
License Law and Rules	8	(1)
Place of Business	8	(1)
Main Office	8	(1)
Branch Office	8	(1)
Trust Account (Escrow Account)	8	(1)
Advance Fees	9	(1)
Cash Deposits or Withdrawals	9	(1)
Permanent Records	9	(1)
Regulation of Documents	9	(1)
Contracts	9	(1)
Other Documents	9	(1)
Broker Business Relationships	10	(1)
Listing Broker and Seller/Principal	10	(1)
Licensee and Buyer/Principal	10	(1)
Broker as Disclosed Dual Agent	10	(1)
Broker as Transaction Broker	11	(1)
Broker and Salesperson	11	(1)
Advertising	11	(1)
Price-Fixing	11	(1)
Probation, Suspension and Revocation	12	(1)
Procedure	12	(1)
Violations	12	(1)
Summary	13	(1)
Key Terms Review	13	(1)
Review Questions	14	(2)
What is Real Estate?	16	(7)
Key Terms	16	(1)
Real Estate	16	(1)
Land versus Real Estate	16	(2)
Land	16	(1)
Real Estate	17	(1)
Real Property versus Personal Property	18	(1)
Fixtures	18	(1)
Tenant and Trade Fixtures	18	(1)
Legal Tests of a Fixture	19	(1)
Summary	19	(1)
Key Terms Review 1	20	(1)
Key Terms Review 2	20	(1)
Review Questions	21	(2)
Estates and Interests	23	(10)
Key Terms	23	(1)
Estates In Land	23	(1)
Fee Simple Estate	23	(1)
Fee Determinable	24	(1)
Life Estate	24	(1)
Downer and Curtesy	24	(1)
Encumbrances	24	(4)
Liens	24	(2)
Lis Pendens	26	(1)
Easements	26	(2)
Licenses	28	(1)
Encroachments	28	(1)
Deed Restrictions	28	(1)
Summary	28	(1)
Key Terms Review 1	29	(1)
Key Terms Review 2	30	(1)
Review Questions	30	(3)
Ownership of Real Estate	33	(10)
Key Terms	33	(1)
Forms of Ownership	33	(1)
Tenancy in Severalty	33	(1)
Tenancy in Common	33	(1)
Joint Tenancy	33	(1)
Tenancy by the Entirety	34	(1)
Business Ownership of Real Estate	34	(2)
Partnerships	35	(1)
Corporations	35	(1)
Other Forms of Ownership	36	(1)
Growth of Condominiums and Cooperatives	36	(1)
Condominium Ownership	37	(1)
Establishing a Condominium	37	(1)
Condominium Conversion	37	(1)
Cooperative Ownership	37	(1)
Town Houses	38	(1)
Time-Sharing	38	(1)
Summary	38	(1)
Key Terms Review 1	39	(1)
Key Terms Review 2	39	(1)
Review Questions	40	(3)
Real Estate Taxes	43	(6)
Key Terms	43	(1)
Tax Liens	43	(1)
Ad Valorem Tax (General Tax)	43	(1)
Special Assessments (Improvement Taxes)	44	(1)
The Taxation Process	44	(2)
Tax Appeal	44	(1)
Equalization	44	(1)
Tax Rates	45	(1)
Tax Bills	45	(1)
Tax Liens	45	(1)
Tax Sale	45	(1)
Income Tax Issues for Home Sellers	46	(1)
Summary	46	(1)
Key Terms Review	46	(1)
Review Questions	47	(2)
Land-Use Regulations and Environmental Issues	49	(12)
Key Terms	49	(1)
Land-Use Controls	49	(1)
Private Land-Use Controls	49	(1)
Deed Restrictions	49	(1)
Government Powers	50	(1)
Public Land-Use Controls	50	(1)
Planning	50	(1)
Zoning	50	(1)
Subdivision Regulations	51	(1)
Building Codes	51	(1)
Environmental Issues	51	(1)
Hazardous Substances	52	(3)
Asbestos	52	(1)
Lead-Based Paint and Other Lead Hazards	52	(1)
Radon	53	(1)
Urea-Formaldehyde	53	(1)
Carbon Monoxide	53	(2)
Electromagnetic Fields	55	(1)
Groundwater Contamination	55	(1)
Underground Storage Tanks	55	(1)
Comprehensive Environmental Response, Compensation and Liability Act (CERCLA)	55	(2)
Liability	56	(1)
Industrial Site Recovery Act (ISRA) and Wetlands Protection	56	(1)
Public Access to Beach Areas	57	(1)
Landmark Preservation	57	(1)
Direct Public Ownership	57	(1)
Summary	57	(1)
Key Terms Review	58	(1)
Review Questions	58	(3)
Agency, Brokerage and Ethical Considerations	61	(27)
Key Terms	61	(1)
Brokerage Defined	61	(1)
Broker-Salesperson Relationship	62	(1)
Salesperson and Broker	62	(1)
Independent Contractor versus Employee	62	(1)
Broker's Compensation	62	(2)
Salesperson's Compensation	64	(1)
Agency	64	(6)
Types of Agency	64	(1)
Creation of Agency With Sellers and Buyers	64	(1)
Exclusive Buyer Agency Agreement	64	(1)
Disclosure of Agency	64	(3)
Furnishing the Consumer Information Statement (CIS)	67	(1)
Further Written Disclosures of Agency	67	(1)
Termination of Agency	67	(3)
Buyer as Principal	70	(1)
Fiduciary Responsibilities	70	(1)
Care	70	(1)
Obedience	70	(2)
Accounting	71	(1)
Loyalty	71	(1)
Disclosure (Notice)	71	(1)
General Duty of Fair Dealing	71	(1)
Dual Agency	72	(2)
Dual Agency and Conflict of Interest	72	(2)
Disclosure Issues	74	(1)
Material Information	74	(1)
Off-Site Conditions	74	(1)
Megan's Law	74	(1)
Misrepresentation	74	(2)
Liability Criteria	75	(1)
To Avoid Misrepresentation	75	(1)
Antitrust Laws	76	(1)
Ethics, Liability and Disciplinable Offenses	76	(1)
Disciplines Offenses	76	(1)
Defense Against Claims of Liability	76	(1)
Dual Contracts	77	(1)
Ethics	77	(1)
Professional Organizations	77	(1)
New Jersey Association of Realtors®	78	(1)
Designations	78	(1)
Summary	78	(1)
Key Terms Review 1	79	(1)
Key Terms Review 2	80	(1)
Key Terms Review 3	80	(1)
Review Questions	81	(7)
Cumulative Review Quiz: Chapters 1-8	84	(4)
Fair Housing	88	(13)
Key Terms	88	(1)
Equal Opportunity in Housing	88	(1)
Federal Fair Housing Laws	88	(3)
Civil Rights Act of 1866	88	(1)
Federal Fair Housing Act of 1968	88	(1)
Equal Housing Opportunity Poster	89	(1)
Blockbusting and Steering	89	(2)
Redlining	91	(1)
Enforcement	91	(1)
Threats or Acts of Violence	91	(1)
New Jersey Law Against Discrimination	91	(3)
Prohibited Activities	92	(1)
Exceptions	92	(1)
Financing	92	(1)
Blockbusting and Record Keeping	92	(1)
Poster	92	(1)
Enforcement	92	(2)
Notice at Listing	94	(1)
State Regulations on Rentals	94	(1)
Source of Income, Children in Family	94	(1)
Other Provisions	94	(1)
Multiple Dwelling Reporting	94	(1)
Zoning Discrimination: Mount Laurel I and II	94	(1)
Code for Equal Opportunity	94	(2)
HUD/NAR Fair Housing Partnership	94	(2)
Implications for Brokers and Salespersons	96	(1)
Advertising	96	(1)
Testing	97	(1)
Summary	97	(1)
Key Terms Review	98	(1)
Review Questions	98	(3)
Listing Agreements	101	(10)
Key Terms	101	(1)
Listing Property	101	(6)
Listing Agreements	101	(1)
Open Listing	101	(1)
Exclusive-Agency Listing	101	(1)
Exclusive-Right-to-Sell Listing	101	(1)
Net Listing (Illegal in New Jersey)	102	(1)
Multiple-Listing Service	102	(1)
Termination of Listings	102	(1)
Obtaining Listings	102	(1)
Property Information for Listings	102	(1)
Responsibility for Disclosure	103	(1)
Responsibility for Investigation	103	(1)
Cooperation with Other Licensees	103	(1)
Negotiability of Commission	103	(4)
Attorney General's Memorandum	107	(1)
Expiration of Listing Period	107	(1)
Pricing the Property	107	(1)
Summary	107	(2)
Key Terms Review	109	(1)
Review Questions	109	(2)
Real Estate Contracts	111	(18)
Key Terms	111	(1)
Contract Laws	111	(1)
Essential Elements of a Valid Contract	111	(1)
Types of Contracts	112	(2)
Express and Implied Contracts	112	(1)
Bilateral and Unilateral Contracts	112	(1)
Executed and Executory Contracts	112	(1)
Validity of Contracts	112	(1)
Undue Influences and Duress	113	(1)
Performance of Contract	113	(1)
Assignment and Novation	113	(1)
Discharge of Contract	113	(1)
Default--Breach of Contract	113	(1)
Statute of Limitations	114	(1)
Contracts Used in the Real Estate Business	114	(11)
Preparation of Documents	114	(1)
New Jersey Requirements	114	(1)
Contract Forms	115	(1)
Listing Agreements	115	(1)
Buyer Brokerage Agreements	115	(1)
Transaction Broker and Dual Agency Agreements	115	(1)
Sales Contracts	115	(9)
Option Agreements	124	(1)
Land Contracts	124	(1)
Summary	125	(1)
Key Terms Review 1	125	(1)
Key Terms Review 2	126	(1)
Review Questions	126	(3)
Leases: Landlord and Tenant	129	(20)
Key Terms	129	(1)
Leasing Real Estate	129	(1)
Leasehold Estates	129	(1)
Estate for Years	130	(1)
Periodic Estate	130	(1)
Tenancy at Will	130	(1)
Tenancy at Sufferance	130	(1)
Standard Lease Provisions	130	(8)
Use of Premises	137	(1)
Terms of Lease	137	(1)
New Jersey Requirements	137	(1)
Lead-Based Paint Disclosure	137	(1)
Security Deposits	138	(1)
Late Payments	138	(1)
Legal Principles of Leases	138	(1)
Possession of Leased Premises	138	(1)
Improvements	138	(1)
Maintenance of Premises	138	(1)
Assignment and Subleasing	138	(1)
Destruction of Premises	139	(1)
Termination of Lease	139	(1)
Truth in Renting	139	(1)
Disclosure of Owners and Managers	139	(1)
Federal Crime Insurance	140	(1)
Rental Referral Services	140	(1)
Rent Control	140	(1)
Eviction	140	(1)
Constructive Eviction	140	(1)
Suit for Possession--Actual Eviction	140	(1)
Causes for Eviction	140	(1)
Types of Leases	141	(1)
Gross Lease	141	(1)
Net Lease	141	(1)
Percentage Lease	141	(1)
Other Lease Types	142	(1)
Property Management	142	(1)
Functions of the Property Manager	142	(2)
The Management Agreement	142	(1)
Budgeting Expenses	143	(1)
Renting the Property	143	(1)
Maintaining the Property	144	(1)
Insurance	144	(1)
The Management Field	144	(1)
Summary	144	(1)
Key Terms Review 1	145	(1)
Key Terms Review 2	146	(1)
Review Questions	146	(3)
Mortgages	149	(7)
Key Terms	149	(1)
Note and Mortgage	149	(1)
Trust Deeds	149	(1)
Provisions of the Note or Bond	149	(1)
Provisions of the Mortgage Document	150	(1)
Duties of the Mortgagor	150	(1)
Provisions for Default	150	(1)
Other Clauses	150	(1)
Assignment of the Mortgage	150	(1)
Recording Mortgages	150	(1)
Interest Rates	150	(1)
Usury	150	(1)
Imputed Interest	151	(1)
Prepayment	151	(1)
First and Second Mortgages	151	(1)
Satisfaction of the Mortgage Lien	151	(1)
Assuming a Seller's Mortgage	151	(1)
Buying Subject to a Seller's Mortgage	151	(1)
Alienation Clause	151	(1)
Foreclosure	152	(1)
Deed in Lieu of Foreclosure	152	(1)
Deficiency Judgment	152	(1)
Summary	152	(1)
Key Terms Review	153	(1)
Review Questions	153	(3)
Financing I: Conventional, FHA and VA Loans	156	(11)
Key Terms	156	(1)
Mortgage Financing	156	(1)
Payment Plans	156	(3)
Fixed-Rate Loans	157	(1)
Adjustable-Rate Mortgages	157	(1)
Interest	158	(1)
Tax-deductible Interest Payments	159	(1)
Points	159	(1)
Buydowns	160	(1)
Tax and Insurance Reserves Conventional, Insured and Guaranteed Loans	160	(2)
FHA-Insured Loans	160	(2)
VA-Guaranteed (GI) Loans	162	(1)
New Jersey Homebuyers Program	162	(1)
Summary	163	(1)
Key Terms Review 1	163	(1)
Key Terms Review 2	164	(1)
Review Questions	164	(3)
Financing II: Primary and Secondary Markets	167	(13)
Key Terms	167	(1)
Financing Techniques	167	(1)
Seller-buyer Arrangements	168	(1)
Sources of Real Estate Financing--The Primary Mortgage Market	169	(1)
Application for Credit	170	(1)
Qualifying Ratios	170	(1)
Government Influence in Mortgage Lending	170	(1)
Federal Reserve System	170	(1)
Government Influence in the Secondary Market	170	(1)
Nonconforming Loans	171	(1)
Financing Legislation	171	(1)
Regulation Z	171	(1)
Equal Credit Opportunity Act	172	(1)
Real Estate Settlement Procedures Act	172	(1)
New Jersey Truth-in-lending Act	172	(1)
Summary	172	(1)
Key Terms Review 1	173	(1)
Key Terms Review 2	173	(1)
Review Questions	174	(6)
Cumulative Review Quiz: Chapters 9-15	176	(4)
Appraisal	180	(12)
Key Terms	180	(1)
What Is Appraisal?	180	(1)
Real Estate--The Business of Value	180	(1)
The Real Estate Market	181	(1)
Supply and Demand	181	(1)
Appraising	181	(1)
Value	181	(2)
Market Value	182	(1)
Basic Principles of Value	182	(1)
The Three Approaches to Value	183	(4)
The Sales Comparison Approach	183	(1)
The Coast Approach	184	(1)
Depreciation	185	(1)
The Income Approach	186	(1)
Reconciliation	187	(1)
Before-and-After Method	187	(1)
The Appraisal Process	187	(1)
The Profession of Appraising	188	(1)
Summary	188	(1)
Key Terms Review 1	189	(1)
Key Terms Review 2	189	(1)
Review Questions	189	(3)
Investment and Business Brokerage	192	(9)
Key Terms	192	(1)
Investing in Real Estate	192	(1)
Advantages of Real Estate Investment	192	(1)
Disadvantages of Real Estate Investment	192	(1)
The Investment	193	(1)
Income	193	(1)
Tax Benefits	193	(2)
Exchanges	193	(1)
Depreciation	194	(1)
Deductions and Federal Tax Laws	194	(1)
Installment Sales	195	(1)
Real Estate Investment Syndicates	195	(1)
Forms of Syndicates	195	(1)
Real Estate Investment Trusts	195	(1)
Business Opportunity Sales	196	(1)
Financing	196	(1)
Uniform Commercial Code--Bulk Transfers	196	(1)
Summary	197	(1)
Key Terms Review 1	198	(1)
Key Terms Review 2	198	(1)
Review Questions	199	(2)
Subdivision and Development	201	(7)
Key Terms	201	(1)
Developing and Subdividing Land	201	(1)
Subdivisions	201	(1)
Land Planning	201	(2)
Environmental Hazards	202	(1)
Coastal Regulations	202	(1)
Subdividing	202	(1)
Subdivision Plans	202	(1)
Subdivision Density	203	(1)
Interstate Land Sales Full Disclosure Act	203	(1)
New Jersey Land Sales	203	(1)
Building Regulations	204	(1)
Uniform Construction Code	204	(1)
Warranty and Builders Registration	204	(1)
Enforcement	204	(1)
Construction Permits	204	(1)
Certificate of Occupancy	204	(1)
Hotel and Motel Multiple Dwelling Health and Safety Law	204	(1)
Summary	205	(1)
Key Terms Review	206	(1)
Review Questions	206	(2)
Legal Descriptions and Deeds	208	(14)
Key Terms	208	(1)
Legal Descriptions	208	(2)
Metes and Bounds	208	(1)
Rectangular Survey System	209	(1)
Recorded Plat of Subdivision	209	(1)
Preparation and Use of a Survey	209	(1)
Measuring Elevations	210	(1)
Condominium Descriptions	210	(1)
Deeds	210	(7)
Types of Deeds	210	(1)
Warranty Deed	210	(6)
Requirements for a Valid Conveyance	216	(1)
Execution of Corporate Deeds	217	(1)
Summary	217	(1)
Key Terms Review	218	(1)
Review Questions	219	(3)
Transfer of Title	222	(5)
Key Terms	222	(1)
Title	222	(1)
Alienation of Title	222	(1)
Voluntary	222	(1)
Involuntary	222	(1)
Transfer of a Deceased Person's Property	223	(2)
Probate Proceedings	224	(1)
Transfer of Title by Will	224	(1)
Transfer of Title by Descent	224	(1)
Summary	225	(1)
Key Terms Review	225	(1)
Review Questions	225	(2)
Public Records, Titles and Closings	227	(15)
Key Terms	227	(1)
Public Records and Recording	227	(1)
Recording Acts	227	(1)
Necessity for Recording	227	(1)
Notice	227	(1)
Recording Sales Contracts	228	(1)
Chain of Title	228	(1)
Evidence of Title	228	(1)
Abstract of Title and Attorney's Opinion	228	(1)
Title Insurance	229	(1)
Torrens Certificate	229	(1)
Certificate of Title	229	(1)
Marketable Title	229	(1)
Closing the Transaction	230	(4)
Lender's Interest in Closing	230	(1)
Homeowner's Insurance	230	(1)
Federal Flood Insurance Program	230	(1)
RESPA Requirements	230	(1)
The Title Procedure	231	(1)
Checking the Premises	231	(1)
Releasing Existing Liens	231	(3)
Closing in Escrow	234	(1)
Preparation of Closing Statements	234	(3)
How the Closing Statement Works	234	(1)
Expenses	234	(2)
Items Credited to Buyer (Debited to Seller)	236	(1)
Items Credited to Seller (Debited to Buyer)	236	(1)
The Arithmetic of Proration	237	(1)
Closing	237	(1)
Other Documents At Closing	237	(1)
Summary	237	(1)
Key Terms Review	238	(1)
Review Questions	239	(3)
Real Estate Mathematics	242	(12)
Percentages	242	(1)
Rates	243	(2)
Area and Volume	245	(1)
Land Units and Measurements	246	(1)
Review Questions	246	(8)
Commissions	246	(1)
Insurance and Taxes	247	(1)
Investment	247	(1)
Seller's Net	247	(1)
Financing	247	(1)
Area	248	(1)
Miscellaneous	249	(1)
Cumulative Review Quiz: Chapters 16-22	250	(4)
Practice License Examinations	254	(18)
The New Jersey License Examination	254	(1)
Preparing for the Examination	254	(1)
Practice Examinations	254	(1)
Practice Test A	254	(9)
Practice Test B	263	(9)
Answer Key	272	(7)
Appendix A: Code of Ethics and Standards of Practice	279	(10)
Appendix B: The new Jersey Real Estate License Act--Statute and Rules	289	(63)
Glossary of Real Estate Terms	352	(14)
Index	366