These definitions and phrases will most certainly find their way on to the Michigan Real Estate Exam. So, if you’re studying for the MI exam and want a little help, read through this list, and then check out the practice questions we’ve included for each term. Good luck!
- Encumbrance
- a) What is an encumbrance?
- A real estate tax.
- A claim, lien, charge, or liability attached to real property.
- A type of legal deed.
- A property improvement.
- Answer: 2) A claim, lien, charge, or liability attached to real property.
- Explanation: An encumbrance is a claim, lien, charge, or liability attached to and binding real property, which may lessen its value or obstruct its use. Examples of encumbrances include liens, mortgages, easements, and restrictive covenants.
- a) What is an encumbrance?
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- b) How is a lien typically resolved?
- By transferring ownership of the property to the creditor.
- By refinancing the property.
- By releasing the lien upon payment of the debt.
- By ignoring it and hoping it goes away.
- Answer: 3) By releasing the lien upon payment of the debt.
- Explanation: A lien is a type of encumbrance that gives the creditor the right to sell the property to pay off a debt. Liens can be resolved by releasing the lien upon payment of the debt, by negotiating a settlement, or by foreclosing on the property.
- b) How is a lien typically resolved?
- Explanation: A lien is a type of encumbrance that gives the creditor the right to sell the property to pay off a debt. Liens can be resolved by releasing the lien upon payment of the debt, by negotiating a settlement, or by foreclosing on the property.
- c) Can an encumbrance be removed from a property?
- Yes, but it requires a court order.
- No, encumbrances are permanent.
- Yes, but only if the owner sells the property.
- Yes, but only if the owner pays off the debt in full.
- Answer: 1) Yes, but it requires a court order.
- Explanation: An encumbrance can be removed from a property through various legal processes, such as releasing a lien or obtaining a court order to extinguish an easement.
- Easement
- Title
- Deed
- Appraisal
- Mortgage
- Brokerage
- Closing
- Commission
- Zoning
- Escrow
- Lease
- Encroachment
- Equity
- Inflation
- Principal
- Interest
- Amortization
- Fixture
- Lien
- Market value
- Property management
- Real estate investment trust (REIT)
- Real property
- Tenancy in common
- Tenancy by the entirety
- Joint tenancy
- Tax assessment
- Tax lien
- Property tax
- Homeowner association (HOA)
- Home inspection
- Lead-based paint disclosure
- Offer
- Counteroffer
- Acceptance
- Earnest money deposit
- Breach of contract
- Listing agreement
- Buyer’s agency agreement
- Dual agency
- Exclusive agency
- Exclusive right-to-sell agreement
- Multiple listing service (MLS)
- Comparative market analysis (CMA)
- Real estate commission
- Real estate license
- Real estate transaction
- Real estate appraisal process
- Real estate contracts