Volume 1:
Hi:
Thank you for choosing REMI School for your professional development licensing. From time to time I am asked questions and I try my best to keep track of student inquiries. Here are some of the latest.
When paying special assessments, how long is given in the contract to settle any differences that may arise between the parties: Ans. 5 days
What is the primary difference between a land trust and agreement of sale. Ans: In an agreement of sale there is a transfer of title
In an agreement of sale there is the first conveyance of an interest in the property, which we refer to as beneficial title, and is successful there is a second closing where the vendee arranges other financing and closes on the sale. Ques: Which of the two closings requires payment of the conveyance tax? Ans: the second closing
When must funds be paid to escrow for closing Ans: must be paid in good funds, at least one day prior to scheduled closing
Which is first in the condominium process: Declaration and By Laws, or Zoning. Ans: zoning because it is a feasibility item. If the property is not properly zoned then it will not be fit for a condo.
If taxes are paid by the seller through June 30, 2010 and the sale closes escrow at 8:01am on July 1, who pays the one day of taxes. buyer is charged/debited for one day of property tax.
When does title pass in land court. Remember Delivery and Acceptance is the key for recordation. Title passes at registration ( recordation in the regular system or registration in land court )
Who is responsible for escrow documents: the escrow officer of the licensee. Ans: the licensee. Remember, the licensee has responsibility for the fiduciary interests of the principal. The escrow officer is a neutral party.
How many days are provided to resolve a dispute over special taxes: Ans: 5 days
Per the paragraph C-11 of the Purchase and Sale Agreement, how much of the standard title insurance policy is paid by the buyer: Ans 40% by buyer and 60% by seller
What three information pieces must be shown on every advertisement: Ans: Licensee Name; Licensee Designation ( e.g. R, RA ) and Agency Name.
What is the insurance settlement for value if the owner does not have co insurance: Cash Value which is the cost less depreciation
A damaged roof is what type of depreciation: functional
A bad floor plan; a one bath house; a one car garage is what type of depreciation: functional
A closure of the road near your home is what type of depreciation: external
Here is a question about the authority of the condominium association board. A leak occurs in the condominium unit of an individual owner on the fifth floor of ten story condominium. The condo has water leak in the wall. The condo board files an insurance claim to make the repairs to the fifth, fourth and third floor units affected, but there is a $5,000 deductible. To be financially sound, the board must collect the $5,000 to pay for the deductable. The board can do all of the following except:
(A) charge to common expense, (B) charge owner that had the leak, (C) charge owners least effected, (D) charge only the group that was affected.
The answer (D) is the board can do all of the following except: charge only the group that was affected.
Depreciation is defined as a decline in value for any reason
Is a notorious crime in the community a required disclosure under our license law: Ans. No. A required disclosure or material fact is one that must effect the physical structure.
What is the difference between insurance coverage for basic insurance and premium insurance: Premium insurance covers broken water pipes and flying objects that do damage.
Who sells flood insurance: Ans: the Federal Govt through cooperating insurance vendors
Who make VA loans: The Federal Govt through cooperating lenders
What type of lender typically is said to make large loans either 'at a distance' or 'outside its market area': Ans: Insurance companies
In order to qualify for the personal residence capital gain exemption, what rules must be followed: Ans live in the house 24 months of the last sixty months.
Watch for more to follow
The best to you.
The Staff at REMI School
Volume 2
Thank you for choosing REMI School of Real Estate. This email is one of a series of emails we use as a forum to answer either frequently asked questions or questions of interest asked by our students.
If you have a question, you are invited to write . Here are some questions of interest and professional points to ponder.
Which of the three secondary lenders, Ginnie Mae, Freddie Mac and Fannie Mae is operated by a Department of Government? Ans: Ginnie Mae
What type of loan is decribed as intrests only and having a balloon payment at its term: Ans Straight Loan
What type of loan securitizes both personal and real property as collateral for the loan. Ans: Package Loan
What type of loan securitizes more than one real property for the loan of funds? Ans: blanket loan
What is the primary difference between a Purchase Money Mortgage and an Agreement of Sale? The PMM allows for transfer of title.
Is Hawaii a Lien Theory State or a Title Theory State? Ans: Lien Theory
In Hawaii within how many days must a mechanics lien be filed? Ans: Within 45 days from the completion of visible work
Describe a mechanics lien: Ans: Involuntary, Specific and Equitable
Describe a property tax lien: Ans: Involuntary, Specific and Statutory
Describe an income tax lien: Ans: Involuntary, General and Equitable
Describe a mortgage lien: Ans: Voluntary, Specific and Equitable
How many days notice must a landlord or agent provide to the tenant in order for the landlord or agent to enter the leased space? Ans: 2 days
When must the grantee's funds be deposited into escrow? Ans: at lease one day prior to closing
Asked another way, who is ulitmately responsible for the closing statement? Ans: licensee
Which of the following can not be used as the name of an agency? Ans: an unlicensed person or unlicensed entity
Funds held in trust for another and given to a licensee must be deposited within how many days? Ans: the next business day
Cancellation of any contract using Paragraph C-29 requires that the cancellation be delivered by what time: 11:59pm on the date of the expiration of the contingency
Is tenancy by the entireties limited only to married couples? Ans: No, it can also be used by reciprocal beneficiaries
Volume 3
As you know our school is quite active and our students regularly ask questions. We usually answer those questions directly with students and it turns out 99% are answered by email. And, from time to time students will call and questions are answered by phone or in person.
I gather those questions and list them in an email such as this for your educational use. Here are some recently asked questions.
Which of the following is a good example of reciprocal beneficiaries? Ans: brother and sister ( reciprocal beneficiaries are entitled to use tenancy in the entireties, as the law provides that any two people, who because the law will not permit them to marry, may be classified as reciprocal beneficiaries )
Will a Phase I report include a report of toxins on the site? Ans: No, Phase 1 is a superficial or cursory look at the property. Phase I is one of three phases of environmental reports used in compliance with CERCLA, the comprehensive environmental response and liability act. Phase 1 is only a look at who is on title and how the site is being used or has been used. If Phase 1 indicates more research into possible pollution or contamination is required, the Phase 2 report will be used to research the soil, take samples and determin levels of toxicity. If there is toxicity and the owner decides to clean up the site, then Phase 3 is the plan and the results.
The Phase 1,2,3 reports are used in commercial property purchases. Lenders dont want to lend if the property ( collateral ) is polluted. This is because the law requires every owner in the chain of title becomes responsible for the costs of clean up. If the bank lends the the land turns out to be polluted then the current owner may have to pay out large sums of money for the clean up or the collateral may be assessed with a lien that would damage the bank's position. So prior to the loan a lender will require a Phase I review.
Will a SMA Special Management Area affect decisions on shoreline development? Ans: yes, that is precisely what it was created for.
Which of the following is not a State land use classification? Urban, Rural, Preservation, Development, Conservation or Agriculture? Ans: Neither Preservation or Development are State Classifications. Only the four: Urban, Rural, Conservation and Ag or State Classifications
What is the property order of Division, Zone, Section, Plat, Parcel and if applicable Condo? Ans: that is the correct order
If the contract reads there are ten days provided for completion of an inspection or review, the ten days are measured as calendar or working days? Ans: calendar days
If the contract reads the contingency or term of the contract must be completed by a certain date, then what time of day of that date is the expiration of the contingency? Ans: 11:59pm of that day
Hawaii Conveyance tax is a progressive tax escalating in steps with the sale price of the property. Who is responsible for the amount over the base expense? Ans: unless contracted otherwise, it is the seller
Who pays conveyance tax? Ans: seller C-11a reads" Pursuant to the rules of the Department of Taxation, State of Hawaii, Seller must pay a higher conveyance tax if Buyer is ineligible to file a county real property tax home owner’s exemption on the Property.
Who is eligible for an ERS Loans ( Employee Retirements System )? Ans: current or retired employees of the State or Local Government buying single family, townhome or condo.
Are leasehold properties eligible for an ERS Loans ( Employee Retirements System )? Ans: Yes, as long as there is at least 35 years remaining on the lease with at least ten years fixed.
How many days may a principal broker be absent prior to notifying the real estate commission in writing that he or she has assigned those duties to a broker in charge? Ans 30 days
I hope these questions help you in your pursuit of your professional development dreams.
GENERAL NOTES
Here are some recently asked and answered questions that you might find
helpful. Please forward your questions, and the instructor should get back to
you.
- When is the latest a client can deposit before recordation? is it one day, 2
days or the day of recordation? The State Law is three days. Just as an aside
however, I have done it the same day when it was a bank error or no fault of the
buyer.
-The exam was asking a question regarding HRS15 but I seem can't to find that
section in the book. There is an HAR Title 16 Chapter 99. I am not familiar
with HRS 15.
-True or False? When a property forecloses, does the winning bidder win at 20%
down? False. Foreclosures have over bids of 5% meaning there is a winning bid,
then the court or judge asks if there is an overbid. If someone wants to beat
the previous or winning bid he or she must bid at least 5% more.
- Which is first when establishing a brand new condo? Getting the permit for
zoning or establish the bylaws? Getting the permit for zoning. Remember the
first step in the condo process is the question, "does it qualify under zoning?"
-If a seller pays his taxes until June 30. For July 1, is the seller neither
credited or debited? True. But then, the Buyer is charged one day.
-When does title pass? Is it when the Grantor signs the deed? or when it's
delivered to land court? Wow..... Wow..... If you had not said land court, I
would quickly say when it is delivered and accepted. Just the mere fact you
signed the deed does not account for the requirement of a valid deed that it be
delivered and accepted. Final answer: delivered to land court.
-Is the escrow officer responsible for the closing documents? Another great
question. OK, lets review the roles and answer this question from the view of
real estate agents as professionals with a fiduciarly level of responsibility.
On casual glance it seems the escrow officer is responsible. After all the
escrow officer prepares the documents. Also, the escrow officer is neutral.
The agent on the other hand is loyal to the client. The correct
answer is the real estate licensee because of the licensees
fiduciary duty created by agency. Remember, the fiduciary duties
include: to give benefit of your knowledge, to care; to follow
instructions; to account for any money; to be loyal and disclose.
We also give advice and counsel.
When you weigh the fiduciary obligations of agency ( the licensee )
to those of preparing the documents ( the escrow officer ) and not
being an agent of the person the answer is clear.
On the question pertaining to how many days to resolve a dispute over property
taxes, when in contract, the answer the I find in the Purchase and Sale
Agreement pertaining to disputed matters is five (5) days. Given
no other information I would rely on five days as being the answer.
I forgot to mention that you should read paragraph C-11 of the contract as the
subject of closing costs is often test material.
Lastly, of the two points I said I would further research, the second was
whether advertising must include the initials and or the name with the address