Real Estate Law & Regulations Flashcards
6 cards from real Real Estate practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 6 Real Estate Law & Regulations flashcards as text
Foreclosure is the legal process by which a lender:
Answer: Forces the sale of a property to recover an unpaid mortgage debt
Foreclosure is the legal process allowing a lender to terminate the borrower's equity of redemption and force the sale of the property to satisfy the outstanding debt.
A 1031 exchange (like-kind exchange) allows a real estate investor to:
Answer: Defer capital gains taxes by reinvesting proceeds into a like-kind property
Under IRC Section 1031, investors can defer capital gains tax on the sale of investment property by reinvesting the proceeds into another like-kind investment property within specified timeframes.
In a non-judicial (trustee's sale) foreclosure, the property is sold without:
Answer: Court supervision, using the power of sale clause in the deed of trust
Non-judicial foreclosure is carried out under the power of sale clause in a deed of trust, allowing the trustee to sell the property without court oversight after proper notice.
FIRPTA (Foreign Investment in Real Property Tax Act) requires that when a foreign seller sells US real property, the buyer must:
Answer: Withhold a percentage of the sales price and remit it to the IRS
FIRPTA requires buyers to withhold typically 15% of the gross sale price from a foreign seller and remit it to the IRS to ensure payment of US capital gains taxes.
A certificate of occupancy (CO) is issued by a local government agency to certify that:
Answer: A building complies with applicable building codes and is safe to occupy
A CO is issued after inspections confirm a newly constructed or substantially renovated building meets zoning, building codes, and safety requirements.
The Equal Credit Opportunity Act (ECOA) prohibits lenders from discriminating against loan applicants based on:
Answer: Race, color, religion, national origin, sex, marital status, age, or receipt of public assistance
ECOA requires lenders to evaluate all credit applicants equally without regard to protected characteristics, ensuring fair access to mortgage financing.