Monday, August 25, 2014
Capitalization Math
Value = Income / Rate
Examples:
Value = Income / Rate
Value = $105,000 / 12%
Value = $875,000
Rate = Income / Value
Rate = $114,500 / $900,000
Rate = 12.72%
Income = Value x Rate
Income = $825,000 x 13%
Income = $107,250
Income = Value x Rate
Rate = Income / Value
The relationship of these components can be expressed in the Triangle below. You can always get the third figure by either multiplying or dividing the two given numbers, just remember IRV.
Examples:
Value = Income / Rate
Value = $105,000 / 12%
Value = $875,000
Rate = Income / Value
Rate = $114,500 / $900,000
Rate = 12.72%
Income = Value x Rate
Income = $825,000 x 13%
Income = $107,250
Sunday, August 24, 2014
Legal Descriptions
Legal Descriptions identify a property in a way that the property could never be mistaken for any other parcel.
( Things to remember for the test )
Metes and Bounds
( Things to remember for the test )
Metes and Bounds
- Most Authoritative
- Most difficult to prepare
- Most difficult to interpret
A metes and Bounds description MUST have a definite point of beginning.
Rectangular Survey ( Government Survey )
- Faster and Simpler
- Uses Imaginary Lines
- Baselines and principal meridians
Recorded plat ( Short Form )
- Subdivision blocks and lots
Estates in Land
Leasehold Estates
Estate for Years - Has a Definite point of Beginning and End Date. No Notice is needed by either Landlord or Tenant.
Periodic Estate - Indefinite Period of Time. Notice is required. Typically a notice of 30 days for a Tenant and 60 days for a landlord.
Estate at Will - Uncertain period of time.
Estate at Sufferance - Holdover tenant
Freehold Estates
Fee Simple Absolute - The Highest Form of Legal Estate. Inheritable estate of indefinite duration, without restrictions or conditions in order to retain ownership. It is the most complete ownership of rights.
Fee Simple Determinable - Automatically ends and goes back to the person who granted the estate. Ownership could go back to heirs or a remainder man if named. Based on the occurrence or non occurrence of a stated condition. Must be used in a certain way or gets reverted back to the original owner.
Fee Simple on Condition Subsequent - May be ended by the grantor, a remainder man, or the grantor's heirs. No automatic reversion. Must go to court within a reasonable time after the condition is violated.
Non inheritable
Conventional Life Estates
Legal Life Estates
Estate for Years - Has a Definite point of Beginning and End Date. No Notice is needed by either Landlord or Tenant.
Periodic Estate - Indefinite Period of Time. Notice is required. Typically a notice of 30 days for a Tenant and 60 days for a landlord.
Estate at Will - Uncertain period of time.
Estate at Sufferance - Holdover tenant
Freehold Estates
Fee Simple Absolute - The Highest Form of Legal Estate. Inheritable estate of indefinite duration, without restrictions or conditions in order to retain ownership. It is the most complete ownership of rights.
Fee Simple Determinable - Automatically ends and goes back to the person who granted the estate. Ownership could go back to heirs or a remainder man if named. Based on the occurrence or non occurrence of a stated condition. Must be used in a certain way or gets reverted back to the original owner.
Fee Simple on Condition Subsequent - May be ended by the grantor, a remainder man, or the grantor's heirs. No automatic reversion. Must go to court within a reasonable time after the condition is violated.
Non inheritable
Conventional Life Estates
- " Pur Autre Vie " ( For the life of another )
Legal Life Estates
- Curtesy
- Dower
- Homestead Protection
Types of Mortgage Foreclosure
Judicial
Strict Foreclosure- A legal procedure which enables the lender to take title from a defaulting borrower without a foreclosure sale. The court grants the borrower a specified amount of time to pay off the loan. If the debt is not paid, title is awarded to the lender.
Judicial Sale- Legal proceeding where a lender files a lawsuit against a defaulting borrower in order to force the sale of property held as collateral.
Nonjudicial
Power of Sale - Mortgage provision which enables the lender to foreclose without filing a lawsuit.
Deed in Lieu of Foreclosure- Also know as a "Friendly Foreclosure". A deed given to a lender by a defaulting borrower who wishes to avoid foreclosure proceedings. The lender may or may not accept the deed.
Strict Foreclosure- A legal procedure which enables the lender to take title from a defaulting borrower without a foreclosure sale. The court grants the borrower a specified amount of time to pay off the loan. If the debt is not paid, title is awarded to the lender.
Judicial Sale- Legal proceeding where a lender files a lawsuit against a defaulting borrower in order to force the sale of property held as collateral.
Nonjudicial
Power of Sale - Mortgage provision which enables the lender to foreclose without filing a lawsuit.
Deed in Lieu of Foreclosure- Also know as a "Friendly Foreclosure". A deed given to a lender by a defaulting borrower who wishes to avoid foreclosure proceedings. The lender may or may not accept the deed.
Transfer of Title
Voluntary
Involuntary
Operation of Law
Court Action
- Will,
- Gift
- Sale
- Patent ( Public Grant )
Involuntary
- Natural Causes
- Accretion
- Alluvion
- Dereliction.
Operation of Law
- Condemnation
- Escheat
- Intestate Succession
- Adverse Possession
- Community Property
Court Action
- Lien Foreclosure
- Partition Sale
- Quite Title
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