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Questions and Answers
What does a Real Estate Investment Trust (REIT) do?
What does a Real Estate Investment Trust (REIT) do?
- Owns, operates, or finances income-producing real estate (correct)
- Operates a chain of retail stores
- Provides loans to individuals for personal use
- Manages investment portfolios consisting of stocks and bonds
What is the primary purpose of an eminent domain?
What is the primary purpose of an eminent domain?
- To transfer land ownership from one private party to another
- To allow private individuals to sell land to the highest bidder
- To allow the government to use land for public purposes such as roadways or utility services (correct)
- To enable property owners to expand their land holdings without purchase
Which of the following can be considered a function of a REIT?
Which of the following can be considered a function of a REIT?
- Operating income-producing real estate (correct)
- Providing insurance coverage
- Issuing personal loans
- Regulating the stock market
Eminent domain is best described as what type of legal right?
Eminent domain is best described as what type of legal right?
A company that offers shares to the public and earns income from real estate operations is known as?
A company that offers shares to the public and earns income from real estate operations is known as?
What is a loan used to purchase real estate, where the property's value serves as collateral for the loan?
What is a loan used to purchase real estate, where the property's value serves as collateral for the loan?
Which term describes the process of gradually paying off a loan through regular payments?
Which term describes the process of gradually paying off a loan through regular payments?
Which document establishes ownership of a property?
Which document establishes ownership of a property?
What is an expert assessment of a property's value called?
What is an expert assessment of a property's value called?
What is the final step in a real estate transaction where the property title is transferred from the seller to the buyer?
What is the final step in a real estate transaction where the property title is transferred from the seller to the buyer?
Which term defines a limited interest in land, meaning a right to use another's land for a specific purpose?
Which term defines a limited interest in land, meaning a right to use another's land for a specific purpose?
Which of the following describes a legal claim against a property used as collateral for a debt?
Which of the following describes a legal claim against a property used as collateral for a debt?
What is the difference between the market value of a property and the amount owed on any mortgage against it?
What is the difference between the market value of a property and the amount owed on any mortgage against it?
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Study Notes
Real Estate Terminology
Property Valuation and Ownership
- Appraisal: expert assessment of a property's value for various purposes
- Deed: legal document establishing property rights
- Title: legal document establishing ownership of a property
- Fair Market Value: highest price a willing seller would accept for a property
Real Estate Transactions
- Closing: final step in a real estate transaction, transferring property title and settling finances
- Mortgage: loan to purchase real estate, using the property as collateral
- Lien: legal claim against a property, used as collateral for debt
- Collateral: property or asset used to secure a loan
Property Rights and Restrictions
- Easement: limited interest in land for a specific purpose (e.g., utility service)
- Zoning: laws regulating property use in specific geographic districts
- Eminent Domain: government's legal right to use private land for public projects (e.g., roadways)
Financing and Investment
- Interest Rate: percentage of a loan charged by a lender to a borrower
- Amortization: gradual payment of a loan through regular installments
- Equity: difference between a property's market value and mortgage debt
- Real Estate Investment Trust (REIT): company owning, operating, or financing income-producing real estate, offering public shares
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