Real Estate Outline

NATIONAL CONTANT

I. Property ownership

a. Real versus personal property; conveyances

b. Land characteristics and legal descriptions

i. Types of legal descriptions; Metes and bounds, Lot and block, government survey

ii. Measuring structures

iii. Livable, rentable, and usable area

iv. Land Measurement

v. Mineral, air, and water rights

c. Encumbrances and effects on property ownership

i. Liens

ii. Easements and licenses

iii. Encroachments

iv. Other potential encumbrances of title

d. Types of ownership

i. Tenants in common

ii. Joint tenancy

iii. Common-interest ownership

1. Timeshares

2. Condominiums

3. Co-ops

iv. Ownership in severalty/sole ownership

v. Life Estate ownership

vi. Property ownership held in trust (BROKER ONLY)

II. Land use controls and regulations

a. Government rights in land

i. Property taxes, and special assessments

ii. Eminent domain, condemnations, escheat

b. Government controls

i. Zoning and master plans

ii. Building codes

iii. Regulation of special land types

1. Flood zones

2. Wet lands

iv. Regulation of environmental hazards

1. Types of hazards

2. Abatement and mitigation

3. Restrictions and contaminated property

v. Private controls

1. Deed conditions or restrictions

2. Covenants, conditions, and restrictions (CC&R)

3. Homeowners association regulations

III. Valuation and market analysis

a. Appraisals

i. Purpose and use of appraisals for valuation

ii. General steps in appraisal process

iii. Situations requiring appraisal by certified appraiser

b. Estimating Value

i. Effect of economic principles and property characteristic

ii. Sales or market comparison approach

iii. Cost approach

iv. Income analysis approach

c. Competitive/ Comparative Market Analysis

i. Selecting comparables

ii. Adjusting comparables

IV. Financing

a. Basic concepts and terminology

i. Points

ii. LTV

iii. PMI

iv. Interest

v. PITI

vi. Financing instruments (mortgage, promissory note, etc.)

b. Types of loans

i. Conventional loans

ii. FHA Insured loans

iii. VA guaranteed loans

iv. USDA/rural loan programs

v. Amortized loans

vi. Adjustable-rate mortgage loans

vii. Bridge loans

viii. Owner financing (installment and land contract/contract for deed)

c. Financing and lending

i. Lending process application through closing

ii. Financing and credit laws and rules

1. Truth in lending

2. RESPA

3. Equal Credit Opportunity

4. CFPB/TRID rules on financing and risky loan features

iii. Underwriting

1. Debt ratios

2. Credit scoring

3. Credit history

V. General principles of agency

a. Agency and non-agency relationships

i. Types of agents and agencies

ii. Other brokerage relationships (non-agents)

1. Transactional

2. Facilitators

b. Agents duties to clients

i. Fiduciary responsibilities

ii. Traditional agency duties (COALD)

iii. Powers of attorney and other delegation of authority

c. Creation of agency and non-agency agreements; disclosure of conflict of interest

i. Agency and agency agreements

1. Key elements of different types of listing contracts

2. Key elements of buyer brokerage/tenant representation contracts

ii. Disclosure when acting as principle or other conflict of interest

d. Responsibilities of agent to customers and third parties, including disclosure, honesty, integrity, accounting for money

e. Termination of agency

i. Expiration

ii. Completion/performance

iii. Termination by force of law

iv. Destruction of property/ death of principle

v. Mutual agreement

VI. Property disclosures

a. Property condition

i. Property condition that may warrant inspections and surveys

ii. Proposed uses or changes in uses that should trigger inquiry about public or private land use controls

b. Environmental issues requiring disclosure

c. Government disclosure requirements (LEAD)

d. Material facts and defect disclosure

VII. Contracts

a. General knowledge of contract law

i. Requirements for validity

ii. Factors affecting enforceability of contracts

iii. Void, voidable, unenforceable contracts

iv. Rights an obligation of parties to a contract

v. Executory and executed contracts

vi. Notice, delivery and acceptance of contracts

vii. Breach of contract and remedies for breach

viii. Termination, rescission and cancellation of contracts

ix. Electronic signature and paperless transactions

x. Bilateral vs. unilateral contracts (option agreements)

b. Contract clauses, including amendments and addenda

c. Offers/ purchase agreements

i. General requirements

ii. When offer becomes binding

iii. Contingencies

iv. Time is of the essence

d. Counteroffers / multiple offers

i. Counteroffers

ii. Multiple offers

VIII. Leasing and property management

a. Basic concepts/ duties of property management

b. Lease agreements

i. Types of leases, percentage, gross, net, ground

ii. Key elements and provisions of lease agreements

c. Landlord and tenant rights and obligations

d. Property managers fiduciary responsibilities

e. ADA and Fair Housing compliance in property management

f. Setting rents and lease rates (BROKER ONLY)

IX. Transfer of title

a. Title insurance

i. What is insured against

ii. Title searches, title abstracts, chain of title

iii. Marketable vs insurable title

iv. Potential title problems and resolution

v. Cloud in title, suit to quiet title (BROKER ONLY)

b. Deeds

i. Purpose of deed, when title passes

ii. Types of deeds and when used

iii. Essential elements of deeds

iv. Importance of recording

c. Escrow or closing; tax aspects of transferring title to real property

i. Responsibilities of escrow agent

ii. Prorated items

iii. Closing statements/TRID disclosures

iv. Estimating closing costs

v. Property and income taxes

d. Special processes

i. Foreclosure

ii. Short sale

e. Warranties

i. Purpose of home or construction warranty programs

ii. Scope of home or construction warranty programs

X. Practice of real estate

a. Trust/ escrow accounts

i. Purpose and definition of trust accounts, including monies held in trust accounts

ii. Responsibility for trust monies, including commingling/ conversion

b. Federal fair housing laws and the ADA

i. Protected classes

ii. Prohibited conduct (red-lining, blockbusting, steering)

iii. Americans with disabilities (ADA)

iv. Exemptions

c. Advertising and technology

i. Advertising practices

1. Truth in advertising

2. Fair housing issues in advertising

ii. Use of technology

1. Requirements for confidential information

2. Do-not-call list

iii. Licensee and responsibilities

1. Employee

2. Independent Contractor

3. Due diligence for real estate transactions

4. Supervisory responsibilities (BROKER ONLY)

iv. Antitrust laws

1. Antitrust laws and purpose

2. Antitrust violations in real estate

XI. Real estate calculations

a. Basic math concepts

i. Loan-to-value ratios

ii. Discount points

iii. Equity

iv. Down payment/ amount to be financed

b. Calculations for transactions

i. Property tax calculations

ii. Prorations

iii. Commission and commission splits

iv. Sellers proceeds of sale

v. Buyer funds needed at closing

vi. Transfer fee/ conveyance tax/ revenue stamps

vii. PITI (principle, Interest, Taxes and Insurances) payments

c. Calculations for valuation, rate of return (BROKERS ONLY)

STATE CONTENT

I. State Governance of the Real Estate Profession

a. General Powers and Structure of Governing Bodies

b. Audit of records

c. Investigations, hearings and Appeals

d. Violations and Penalties Edu.

e. Recovery Fund

II. Licensing Requirements

a. Activities Requiring a License

b. License Renewal and Maintenance

c. Change in License Status (military, retired, inactive)

d. Post Licensing Education and Continuing Education

III. License law and rules of the Ohio Real Estate Commission

a. Advertising/ use of business Name/ Misrepresentation/ team advertising

b. Broker / Salesperson Employment or independent Contractor Agreement

c. Commissions and fees paid through broker only / agent compensation

d. Document handling and record keeping (includes contracts and listings)

e. Handling of monies/ condensations (Items of Value)

f. Trust of Special accounts (BROKER ONLY)

g. Types of listings, Rules

h. Offers, Counteroffers, Acceptance (including electronic documents)

i. Ohio Broker Lien law (BROKER ONLY)

j. Inducements

k. Ancillary Trustee (Procedure if Broker Dies) (BROKER ONLY)

l. Property management (Includes Leases)

m. Rentals

n. Broker’s License Display (BROKER ONLY)

o. Ohio Fair Housing

IV. Brokerage Relationships (Agency Law)

a. Creating Agency and Agency Contracts/ Types of Agency Relationships

b. Licensee duties and obligations to clients and Customers, Licensee Liabilities, Waiver of Duties

c. Termination of Agency

d. Confidentiality

e. Disclosure of Agency Relationships and Listing Information

f. Disclosures Required when Dealing with Own Properties

g. Unauthorized Practice of law

h. False Representations of Licensee Status or Expertise

i. Canon of ethics