Ch10. Final Comprehensive Review — All Subjects for the Real Estate License Exam

Subject-by-Subject Summary

Salesperson Exam Subjects (varies by state — PSI / Pearson VUE):
National portion:
  Real Estate Principles & Practices: property rights, contracts, agency, finance
  Real Estate Law: title, deeds, mortgages, fair housing, RESPA

State portion (example — California):
  California Real Estate Law
  Real Estate Practice
  Finance & Appraisal Concepts

Real Property Rights vs Personal Property

┌────────────────────┬──────────────────────────┬──────────────────────────┐
│ Category           │ Real Property             │ Personal Property        │
├────────────────────┼──────────────────────────┼──────────────────────────┤
│ Nature             │ Immovable, runs with land │ Movable                  │
│ Examples           │ Land, buildings, fixtures │ Furniture, vehicles      │
│ Transfer           │ Deed                      │ Bill of sale             │
│ Priority           │ Recording protects        │ Possession / UCC filing  │
└────────────────────┴──────────────────────────┴──────────────────────────┘

Critical Numbers & Deadlines

Adverse possession: state-specific (commonly 5–21 years)
Transfer disclosure statement: due at or before contract signing
Lead-based paint addendum: 10-day inspection right (pre-1978 homes)
RESPA Loan Estimate: within 3 business days of application
Closing Disclosure: at least 3 business days before closing
Right of rescission (TILA): 3 business days for refinances
Capital gains exclusion: $250,000 (single) / $500,000 (married filing jointly)
  → requires 2 of last 5 years as primary residence
Property tax reassessment: Prop 13 (CA) caps annual increase at 2%
Listing agreement term: negotiable, typically 3–6 months

Top 10 Commonly Missed Points

① Fee simple vs leasehold — fee simple is ownership; leasehold is a tenancy
② No public faith in recording — recording does not cure a defective title
③ TOAC — title transfers without a deed: Testamentary, Operation of law,
   Adverse possession, Court order
④ Adverse possession requires: open, notorious, hostile, actual, continuous use
⑤ Capital gains timeline: 2-of-5-year rule for primary residence exclusion
⑥ Single-family residential zoning typically prohibits commercial use
⑦ Lis pendens = pending litigation affecting title (recorded notice, not a lien)
⑧ Comprehensive Plan (General Plan) guides zoning but is not zoning itself
⑨ Commission agreements exceeding "market rate" are still enforceable
⑩ Land contract / contract for deed = equitable title only; legal title stays
   with seller until loan is paid in full

Real Estate License Exam — National Portion ★★★★★ : Covers real estate principles, property law, contracts, finance, and fair housing — the same content regardless of which state you test in. Memory tip: National = universal principles; State = local law

State Exam Portion ★★★★★ : Tests knowledge of your specific state’s license law, agency rules, and disclosure requirements. Content differs by state. Memory tip: State portion = know your state’s rules

Tenancy in Common vs Joint Tenancy ★★★★★ : Tenancy in common — each owner has a separate, inheritable share. Joint tenancy — right of survivorship; deceased owner’s share passes automatically to surviving owners. Memory tip: Joint tenancy = survivorship rights

Practice Quiz (Comprehensive)

Q. What are the requirements for a tenant to gain protection under a standard residential lease in the US, and what rights does it provide?

A written lease signed by both parties establishes the tenancy. Tenants are protected by the implied warranty of habitability. In most states, tenants have the right to withhold rent or repair-and-deduct if landlord fails to maintain habitable conditions. Eviction requires proper legal notice (commonly 3-, 30-, or 60-day notice depending on reason and state).

Q. How does zoning affect a real estate transaction?

Zoning determines permitted uses, setbacks, height limits, and lot coverage requirements. A buyer must verify that their intended use is allowed in the current zone. Rezoning or a variance may be required for non-conforming uses. Zoning changes can dramatically affect property value and developability. A zoning report or title search should be part of standard due diligence.