Entering the world of real estate can feel like learning a new language. As in any industry, real estate comes with its unique terminology, which can be daunting for those new to the field. But fear
Entering the world of real estate can feel like learning a new language. As in any industry, real estate comes with its unique terminology, which can be daunting for those new to the field. But fear not; mastering this language is not only possible but also a critical component of becoming a..
|
Whether you're a first-time homebuyer, a student at our real estate school, or a professional within the real estate industry, trust and transparency are critical factors in your interactions and transactions.
Whether you're a first-time homebuyer, a student at our real estate school, or a professional within the real estate industry, trust and transparency are critical factors in your interactions and transactions. An essential component of this transparency is the real estate license number. Every licensed real estate professional is issued a unique identifier: a license number. This number is not merely an administrative detail but a tool to uphold professionalism and instill confidence in the industry.
Looking up a real estate license number is an extra step in an already complex process. However, it's a task that carries significant importance. Firstly, it allows clients to verify the credentials of a real estate professional, ensuring that they are dealing with a licensed individual with the necessary training and competence. This can help protect clients from fraudulent practitioners or those who don't have the necessary credentials.
Additionally, for real estate professionals, verifying a license number can provide insight into a colleague's professional background and standing, such as any disciplinary actions taken against them. It fosters accountability within the profession and is an essential part of due diligence in transactions like referrals and collaborations.
In essence, checking a real estate license number is a straightforward measure that enhances trust and transparency. It's an essential step in ensuring the legitimacy of interactions in real estate. As we delve deeper into this topic, we will explore what a real estate license number is, how to look one up, and why this simple check can significantly impact your real estate journey.
Understanding What a Real Estate License Number Is
A real estate license number is a unique identifier, much like a badge of legitimacy, assigned to each real estate professional who has successfully passed their real estate exam and received licensing from their state's regulatory body. This distinct number serves as proof of a professional's eligibility to conduct real estate transactions within their respective state. This applies to various roles in the industry, whether one is a real estate broker, an agent, an appraiser, or any other certified professional in the field.
However, a real estate license number provides more than proof of licensure. It is a gateway to a wealth of information about the professional's background and track record. When you look up a real estate license number, you can typically find details such as:
The licensee's full name.
The licensee's professional standing (whether active, inactive, or retired licensee).
The license status (whether it's current, expired, suspended, or revoked).
Any disciplinary actions taken against the licensee by the regulatory body.
The dates of issue and expiration of the license.
The licensee's areas of specialty or additional certifications.
Details of the licensee's affiliated brokerage, if applicable.
It's important to note that the specific details accessible can vary between states, as each state's regulatory body may have different rules and regulations regarding the transparency of license information.
Understanding and using this information effectively can help you make informed decisions in your real estate transactions. Whether you're confirming an agent's credentials, considering hiring, or verifying the standing of a peer, understanding what a real estate license number is and the information it provides is a key step in confidently navigating the real estate landscape.
Situations When You Might Need to Lookup a Real Estate License Number
You should look up a real estate license number in several situations. Here are some common scenarios:
Hiring a Real Estate Agent or Broker: If you're a client preparing to embark on a real estate transaction, hiring a licensed professional to guide you is essential. Looking up their real estate license number allows you to verify their standing, check for any disciplinary actions, and ensure they can legally assist with your real estate needs. It provides a level of reassurance about the professional's qualifications and credibility.
Verifying a Professional's Credentials: In some instances, you may need to confirm the credentials of a real estate professional. For example, suppose you're another real estate agent considering a partnership or a client looking for specialist services. In that case, you should check whether the professional holds the necessary certifications or specialties.
Filing a Complaint: Unfortunately, there might be circumstances when you're unsatisfied with a real estate professional's service, suspect malpractice, or need to resolve a dispute. In these cases, you would need the real estate license number to file a formal complaint with the relevant state licensing board. The licensing board uses the number to identify the individual involved and investigate the matter appropriately.
Conducting Due Diligence: For professionals involved in complex transactions, such as real estate lawyers or investors, looking up a license number may be necessary in their due diligence process. This process can help verify the identities and credentials of all involved parties, ensuring compliance with legal requirements.
For Journalism or Research Purposes: Journalists, researchers, or anyone conducting a study on real estate markets might need to look up real estate license numbers to gather information for their projects. License information can provide valuable insights into market trends, regulatory compliance, or professional demographics.
Looking up a real estate license number can serve various purposes, all centered around ensuring credibility, accountability, and transparency within the real estate industry. It's a simple yet effective tool for safeguarding the interests of all parties involved in real estate transactions.
Step-by-Step Guide on How to Lookup a Real Estate License Number
Looking up a real estate license number is usually a straightforward process - far easier than finding out who owns a particular property. However, please note that the specifics might vary slightly from state to state due to differences in real estate regulations and the design of each state's real estate commission website. Here's a general guide on how to do this:
Identify the Relevant State Real Estate Commission Website: Each state has its own Real Estate Commission or similar regulatory body overseeing real estate professionals' licensing. You must visit the appropriate website for the state where the real estate professional is licensed. A simple Google search using the state's name and "Real Estate Commission" should help you find the right site.
Navigate to the 'License Lookup' Section: Once on the state's real estate commission website, look for the 'License Lookup,' 'Verify a License,' 'Licensee Search,' or a similarly named feature. This feature is typically easy to find and is often located in a prominent place on the website's homepage or under a 'Public Resources' or 'Consumer Tools' tab.
Enter the Necessary Information: In the license lookup section, you'll typically see fields where you can enter information about the licensee. This could be the person's name, the company's name, or the license number itself if you have it but want to verify its validity. Fill in as much information as you can to facilitate the search.
Conduct the Search: Once you've entered the required information, hit the 'Search' or 'Submit' button to start the search. The system will then scan its database for the relevant details.
Review the Results: The search should return a summary of the professional's license status, including their full name, license number, status (active, inactive, expired, or suspended), any specialty licenses, and possibly even any disciplinary actions taken against them.
This general process should help you look up a real estate license number. Remember that the importance of verifying the license number lies in ensuring the credibility of the real estate professional you are dealing with and maintaining transparency in all real estate transactions.
How to Lookup a Real Estate License Number by State
While the overall process of looking up a real estate license number is essentially the same across the United States, there are slight differences in how each state's regulatory commission's website operates. Here, we will provide an overview of how to search for a real estate license number in three of the most populous states: California, Texas, and Florida.
California
Visit the California Department of Real Estate's License lookup page.
Enter the individual or company's name, license ID, or the city they are located in.
Click the 'Find' button to view results, which include the license number, status, and expiration date.
Texas
Go to the Texas Real Estate Commission's License Holder Lookup page.
Enter the person or company's name or the license number if you verify it.
Click 'Search' to view results, displaying the license number, type, status, and any disciplinary actions taken.
Florida
Visit the Florida Department of Business and Professional Regulation's Licensee Search page.
Please enter the name, city of the individual, business, or license number.
Click 'Search' to display results, including the license number, status, and the licensee's address.
In each case, having the correct name or license number will make your search more accurate. Also, note that the information available may vary based on privacy laws in each state. Always cross-check and verify information obtained through these searches to maintain accurate and ethical business practices.
What to Do if There Are Issues or Discrepancies
In the world of real estate, credibility and trustworthiness are paramount. If you encounter any issues or discrepancies when looking up a real estate license number, it's essential to address these concerns promptly. Here's what you should do:
Reverify the Information: Mistakes happen, and they can be as simple as a typographical error. Double-check the details you've entered if a license number appears invalid or brings up unexpected results. Ensure there's no misspelling in the name or error in the license number.
Check with Other Sources: If you continue to encounter issues, try to verify the license number through different means. You could ask the real estate professional to provide more proof of their licensure or contact their brokerage.
Contact the Relevant Real Estate Commission: If discrepancies persist, contact your state's real estate commission or the licensing authority where the agent is supposed to be licensed. They can provide further assistance and confirm the license status. Make sure to provide all relevant details to help them expedite the process.
Report any Concerns: If your inquiry reveals a person practicing real estate without a valid license, it's essential to report this to the relevant authorities. Unlicensed practice is a serious offense and can harm unsuspecting clients and tarnish the reputation of the real estate industry.
Remember, every licensed real estate professional must operate transparently, and any reluctance to share license details should be a red flag. Taking these steps will protect you and contribute to maintaining the integrity of the real estate industry.
Navigating the real estate landscape requires understanding market trends and recognizing the importance of trust and transparency. One significant way of establishing this is by verifying real estate license numbers. This simple yet crucial step can play a pivotal role in building professional relationships based on trust, be it with your clients, colleagues, or other stakeholders in the industry.
Looking up a real estate license number is a protective measure, ensuring that you are dealing with a certified professional recognized by the governing real estate bodies. It assures the authenticity and credibility of the real estate professional you are engaging with, whether hiring an agent, verifying credentials, or filing a complaint.
Moreover, it plays a key role in maintaining the integrity and professionalism of the real estate industry. By being diligent and proactive in these verifications, we contribute to an industry standard where transparency is the norm, not the exception.
So whether you're a buyer, a seller, a real estate agent, or someone eyeing a career in real estate, remember that license verification is a small step that goes a long way in ensuring fair and honest real estate transactions. Keep the guide above handy, and make the most of the resources available to you, confirming your journey in the world of real estate is as smooth and secure as possible.
As always, if you are interested in taking real estate courses visit www.adhischools.com or call us at 888-768-5285.
Love,
Kartik
|
There are lots of new things to learn when you are getting into real estate, and knowing about the mortgage markets is one of them. As a real estate student preparing for your exam, comprehending these
There are lots of new things to learn when you are getting into real estate, and knowing about the mortgage markets is one of them. As a real estate student preparing for your exam, comprehending these markets in depth is not just a requirement, but a stepping stone towards securing your real estate license.
This comprehension won't only serve you in passing the exam, but it will also equip you with the tools necessary to provide informed advice to future clients. After all, understanding the mechanisms of the mortgage markets will be key to your ability to guide your clients effectively through their journey toward homeownership.
So, what exactly are mortgage markets? Mortgage markets involve the process of lending, borrowing, buying, and selling mortgage loans. Essentially, they are the conduits that make home ownership possible. And to fully grasp their workings, it's important to understand that they're divided into two sectors – the primary and secondary mortgage markets.
This blog post is designed as a guide for real estate students to help differentiate between the primary and secondary mortgage markets. I want to cover the definitions, roles of parties market. With this knowledge, you'll be better equipped to navigate and succeed in your future real estate endeavors. So let's delve into the world of mortgage markets and enhance your journey towards becoming skilled real estate professionals.
Primary Mortgage Market: An Overview
The primary mortgage market is where it all begins for homebuyers. It's the marketplace where borrowers and mortgage originators come together to negotiate and agree on the terms of new mortgage loans. In simple terms, it's where you, as a potential homeowner, would obtain a loan to buy - or refinance - a property.
The key players in the primary mortgage market are borrowers and lenders. These banks (or mortgage companies) often provide the funds for borrowers to purchase their dream homes. They are responsible for setting the loan terms, including interest rates and repayment schedule, and verifying the borrower's creditworthiness and ability to repay the loan.
Obtaining a mortgage loan from the primary market is straightforward. A potential homeowner applies for a mortgage loan from a lender. The lender then scrutinizes the applicant's credit history, current income, employment status, and other factors before approving the loan. Once the loan is approved and the agreement is signed, the borrower begins to repay the loan, typically for 15 to 30 years.
Consider this scenario: John and Sarah, eager to buy their first home, approach their local bank for a mortgage loan. After reviewing their application and assessing their financial position, the bank approves their loan at a fixed interest rate for 30 years. This entire transaction is part of the primary mortgage market.
As real estate students, understanding the primary mortgage market's functioning is crucial. It provides the foundation of the mortgage industry and is the starting point of most real estate transactions.
Secondary Mortgage Market: An Overview
While the primary mortgage market involves the creation of new mortgage loans, the secondary mortgage market revolves around the buying and selling of existing mortgages and mortgage-backed securities. Home buyers do not directly participate in the secondary mortgage market as this is largely the domain of large financial institutions and investors.
Investors and financial institutions, like Fannie Mae and Freddie Mac, play a significant role in the secondary mortgage market. These government-sponsored entities buy existing mortgage loans from lenders, bundle them into mortgage-backed securities, and then sell them to investors. This process frees up the lender's resources, allowing them to issue more loans in the primary mortgage market.
For instance, let's revisit John and Sarah's story. After their bank granted them a mortgage, the bank could then sell it to a larger financial institution like Fannie Mae. Fannie Mae then pools John and Sarah's mortgage with hundreds of similar mortgages to create a mortgage-backed security, which is then sold to investors. This entire transaction takes place in the secondary mortgage market.
Why does this matter to real estate students? Understanding the secondary mortgage market is essential as it directly influences the primary mortgage market. It dictates mortgage rates and availability of loans and contributes significantly to the overall health of the real estate market. It’s a key component of the knowledge you'll need to obtain your real estate license.
Secondary Mortgage Market: An Overview and Its Significance
As discussed, while the primary mortgage market is initial loan creation, the secondary mortgage market is where existing mortgages and mortgage-backed securities (MBS) are bought and sold. It may seem abstract compared to the more direct borrower-lender interactions of the primary market. Still, its impact is far-reaching and fundamental to the functioning of the broader economy.
The secondary mortgage market's leading players are large financial institutions and investors, including government-sponsored entities like Fannie Mae and Freddie Mac. These entities buy existing mortgage loans from lenders, package them into MBS, and then sell these securities to investors on the open market. This cycle is an economic engine that keeps mortgage funds flowing – but how exactly does it work, and why is it so crucial?
Liquidity and the Recycling of Capital
In essence, the secondary mortgage market provides liquidity to the banking system. When lenders, such as banks, originate a loan in the primary market, that loan is an asset tied up in the property for the duration of the mortgage term, often 15 to 30 years. This represents a significant commitment of the lender's capital, limiting their ability to offer new loans.
Lenders can recycle their capital by selling these loans on the secondary market. The sale frees up their resources, allowing them to originate more loans. It's akin to a fresh injection of cash into the primary market. The more active the secondary market, the more liquidity lenders have, ultimately making mortgages more accessible to potential homeowners.
Why Investors Buy Mortgage-Backed Securities
But why would investors want to buy MBS? The answer lies in the appeal of these instruments as investment vehicles. Mortgage-backed securities are income-generating assets. The monthly mortgage payments made by borrowers (consisting of principal and interest) pass through to MBS investors as regular income, making them an attractive long-term investment.
Furthermore, MBS are often considered lower-risk assets. Real estate, a physical asset, backs them and often carries guarantees from government-sponsored entities against defaults on the underlying loans. This combination of regular income and lower risk makes MBS popular among many investors.
So you can see that the secondary mortgage market plays an essential role in maintaining liquidity in the banking system and ensuring the availability of mortgage loans. It's the lifeblood of the housing market, turning individual home loans into a cycle of capital that benefits lenders, investors, and homeowners alike. It's a foundational concept for any real estate professional to understand, as it influences mortgage availability and rates and the broader health and vibrancy of the real estate market.
Navigating the labyrinth of the real estate market can be challenging, especially for students preparing for their real estate license exam. Hoping this guide helps as we now understand that the primary mortgage market is where loans are originated, with lenders and borrowers negotiating the terms of new mortgage loans. In contrast, the secondary mortgage market involves the buying and selling existing loans by investors and financial institutions like Fannie Mae and Freddie Mac.
The key takeaway is the interdependence of these two markets. They influence each other significantly, dictating mortgage rates, the availability of loans, and, thus, the overall health of the real estate market.
Understanding these markets equips real estate students with the knowledge necessary for acing their real estate license exam and launching successful careers in real estate. It enables you to provide comprehensive advice to your future clients and better understand the factors influencing the market conditions.
We encourage you to continue exploring these concepts, digging deeper into how they function and their influence on the broader real estate market. Remember, every bit of knowledge gained now is a step towards becoming a proficient real estate professional, ready to make your mark in the dynamic world of real estate.
As always, if you are interested in getting your real estate license or building a career in real estate sales visit www.adhischools.com or call us at 888-768-5285.
Love,
Kartik
|
Unveiling the Math Aspect of the California Real Estate Exam: Is There a Lot of Math?
The California Real Estate Exam is a formidable stepping stone for all those seeking to wear the hat of a
Unveiling the Math Aspect of the California Real Estate Exam: Is There a Lot of Math?
The California Real Estate Exam is a formidable stepping stone for all those seeking to wear the hat of a licensed real estate professional in the Golden State. As part of their preparation, many potential test-takers ask, "Is there a lot of math on the California Real Estate Exam?" The question is an understandable one. Let's explore this question in detail, assessing the quantitative aspects and providing guidance on navigating this portion of the examination successfully.
The Math Component of the California Real Estate Exam
To put it in plain terms, yes, the California Real Estate Exam contains math - but very little. And the level of math involved may not be as extensive or intimidating as you might think. On average, there are only a small number of questions that focus on mathematical problems. These problems test your ability to perform real estate related calculations like computing real estate taxes, property values, commission rates, prorations, interest, mortgage payments, and depreciation.
The Good News: It's Not Rocket Science!
The type of math encountered on the California Real Estate Exam primarily involves basic arithmetic and some simple algebra, including the ability to work with fractions, decimals, and percentages. So, if you have been fretting over complicated equations, exhale a sigh of relief – calculus and advanced mathematics do not feature on this exam!
And there isn’t a lot of it on the state test.
Preparation is Key
Even though the math portion of the exam only makes up a very small fraction of the total questions, it's essential not to take it lightly. As with any other exam section, diligent preparation is key to success. Many resources are available, including textbooks, our real estate exam prep, and practice problems, specifically designed to help candidates understand and master the types of math questions they encounter.
A good starting point would be to familiarize yourself with real estate terminology and principles. Once you grasp these well, you can start working on the calculations. Solve many practice problems related to loan amortization, property valuation, real estate taxes, etc. Understand the formulas rather than just memorizing them. Knowing when and how to use them effectively will make all the difference on exam day.
Remember, speed and accuracy are crucial for these exams. While you need to work quickly, double-checking your answers is equally important to avoid careless mistakes.
Take a Crash Course
A candidate preparing for the real estate test would significantly benefit from taking a crash course prior to their exam. The real estate field encompasses many complex topics, including property laws, contract laws, real estate principles and practices, ethics, and market dynamics.
A crash course is an intensive, fast-paced program that condenses these vast subject matters into digestible chunks, ensuring the candidate comprehensively understands all the necessary information. Additionally, such a course often incorporates practice tests that mimic the actual exam's format and difficulty, providing the candidate with invaluable experience under realistic conditions. It also allows the candidate to pinpoint their strengths and weaknesses, allowing them to focus on areas that need improvement. Overall, a crash course fosters confidence, thoroughness, and strategic examination techniques, thereby improving the chances of success in the real estate exam.
To sum it up, while the California Real Estate Exam does include math problems, they are relatively straightforward and can be tackled efficiently with consistent practice and understanding. Don't let the fear of math deter you from your goal. Remember, every licensed real estate agent in California has passed this test. With the right mindset, diligent preparation, and extra help, you will, too. The pathway to success on the California Real Estate Exam may require you to crunch some numbers, but the rewards of a career in real estate are certainly worth it.
Math-related vocabulary for the state exam:
Benchmark : A reference point used in surveying, marked on a fixed, stable object. Its position and elevation are known and utilized in tidal observations, land surveys, and other geodetic operations.
Board Foot : A unit of measurement for lumber, signifying a volume equal to a one-foot cube of one inch thick wood. It's often used in the lumber industry to price and sell wood.
Decimal : Related to the base-10 system. It signifies a number or fraction expressed in the decimal system. In a decimal number, such as 125.67, the decimal point (.) separates the whole number (125) from the decimal fraction (67).
Denominator : The bottom number in a fraction, indicating the total number of equal parts that constitute the whole. For instance, in the fraction 3/5, '5' is the denominator, representing that the whole is divided into five parts.
Fraction : A mathematical expression representing the division of two numbers or quantities. It's also used to describe a portion or segment of a whole.
Front Foot : A real estate term, denoting a property's linear footage along the frontage (like a street or road). It can be used for pricing properties but needs to account for the property's depth.
Governmental Survey System/Rectangular Survey System : A land division system used in the US. It divides land into 24-square-mile quadrangles using north-south and east-west lines.
Latitude : The geographic coordinate representing the angular distance of a point north or south of the Earth's equator, measured in degrees along a meridian.
Lineal Foot : Another term for a 'foot' in measurement, mainly used to measure the length of items.
Longitude : The geographic coordinate that specifies the east-west position of a point on the Earth's surface. It's an angular measurement, usually expressed in degrees, minutes, and seconds.
Lowest Common Denominator : The smallest multiple that is exactly divisible by every denominator of a set of fractions. It is used to simplify the process of adding, subtracting, and comparing fractions.
Meridian : An imaginary line running from the North Pole to the South Pole on the Earth's surface. All locations along a given meridian share the same longitude.
Numerator : The top number in a fraction, indicating the number of parts of the whole that are considered. For example, in the fraction 3/5, '3' is the numerator.
Point of Beginning : The starting point in land surveying from which the boundaries of a parcel of land are described. This is most often associated with the “metes and bounds” method of land description.
Product : The result obtained from the multiplication of two or more numbers.
Range : In the U.S. public land surveying system, a 'range' refers to a vertical column of townships in a grid layout. It is six miles wide, running north to south, and is numbered based on its distance east or west from a specified meridian.
Rounding : A mathematical process to approximate a number to its nearest whole number, tens, hundreds, etc. It simplifies numbers while still maintaining a reasonable level of accuracy.
Running Foot : A measurement unit used in the lumber industry to measure the length of a piece of wood, irrespective of its width or thickness.
Square Foot : A unit of area measurement equal to a square with sides each one foot long.
|
Are you preparing to take the real estate license exam? Whether attending an online real estate school or studying alone, passing the exam is a significant step in your journey to becoming a licensed
Are you preparing to take the real estate license exam? Whether attending an online real estate school or studying alone, passing the exam is a significant step in your journey to becoming a licensed real estate agent. Here are the top 10 tips to help you succeed on your exam and launch your new career.
Tip 1: Choose the right study materials
The first step in preparing for the exam is selecting the best resources. An accredited online real estate school can provide the necessary curriculum and materials to help you succeed.
ADHI Schools’ materials are second to none in the real estate industry, and thousands of students have used our exam preparation software to take and pass the real estate license exam.
Tip 2: Develop a study schedule
Consistency is vital when preparing for the exam. Set aside a specific time each day to study and review the material.
A well-structured study schedule is critical for success when preparing for the real estate license exam. A consistent and organized study approach helps you retain information more effectively and ensures you cover all the necessary material before taking the exam.
Creating a study schedule is essential for a bunch of reasons. First, it helps you manage your time more efficiently, ensuring that you allocate sufficient hours to review and understand the material. By setting aside specific times each day to study, you establish a routine that becomes a habit, making it easier to stay on track and avoid procrastination. Furthermore, a study schedule allows you to break down the vast material into smaller, manageable segments, reducing the risk of becoming overwhelmed or burned out.
To create an effective study schedule, consider the following tips:
Assess your current commitments: Before developing a schedule, evaluate your daily obligations, such as work, family, and personal activities. This will help you determine how much time you can dedicate to studying daily.
Set specific study times: Allocate particular time slots for studying, ideally when you are most alert and focused. Consistency is key, so try to maintain the exact study times daily to establish a routine.
Break down the material: Divide the course content into smaller sections based on topics or chapters. This will make it easier to focus on specific areas and track your progress.
Prioritize your study topics: Identify areas where you may need more review or practice and allocate more time to those sections.
Set goals and deadlines: Establish clear objectives for each study session, such as completing several practice questions or reviewing a specific topic. Setting deadlines for covering particular sections can also help you stay on track and maintain a sense of urgency.
Allow for flexibility: While consistency is important, adaptability is also essential. Adjust your schedule if you need more time on a specific topic or encounter unforeseen interruptions.
Schedule regular breaks: Incorporate breaks into your study sessions to prevent burnout and maintain focus. Taking brief pauses can improve retention and productivity.
By implementing a consistent and well-structured study schedule, you'll be better equipped to retain the information, cover all the necessary material, and succeed on the real estate license exam. Dedication, discipline, and effective time management are crucial to success.
Tip 3: Take a bunch of practice exams
Practicing exams is crucial to preparing for the real estate license exam. These exams not only help you familiarize yourself with the test format but also allow you to gauge your progress, identify areas for improvement, and build confidence. In this blog post, we'll delve deeper into the importance of practice exams and provide tips on making the most of them in your study routine.
Benefits of Practice Exams:
Familiarity with exam format: Real estate licensing exams can vary by state, but they typically consist of multiple-choice questions that test your knowledge of real estate principles, practices, and laws. Taking practice exams helps you become more comfortable with the exam's question style, pacing, and format.
Assessing strengths and weaknesses: Practice exams enable you to identify the areas where you excel and those that require further study. You can spend more time reviewing and practicing those specific topics by pinpointing your weaknesses.
Building confidence: The more practice exams you take, the more confident you'll feel in answering questions accurately and efficiently. This confidence can help reduce anxiety and improve your performance on the actual exam.
Time management: Practice exams help you develop practical time management skills, ensuring you can complete all questions within the allotted time on the exam.
Tips for Taking Practice Exams:
Simulate test conditions: Try to recreate the environment of the actual exam when taking practice tests. Find a quiet, distraction-free space and time yourself according to the exam guidelines. This will help you become more comfortable with the testing conditions and improve your ability to focus.
Review your answers: After completing a practice exam, thoroughly review and analyze any incorrect responses. This will help you identify areas for improvement and prevent the same mistakes on the exam.
Use various resources: Take advantage of the numerous practice exam resources available, including those provided by your real estate school, online resources, and study guides. This will expose you to many questions and scenarios, better preparing you for the exam.
Track your progress: Record your practice exam scores to monitor your improvement. This will help you determine if your study methods are effective and motivate you to continue working towards your goal.
Please don't overdo it: While practice exams are valuable, it's important not to rely solely on them for exam preparation. Ensure you also allocate time to review course materials, study critical concepts, and attend review sessions or crash courses.
Incorporating practice exams into your study routine is essential for a successful real estate license exam outcome. By familiarizing yourself with the test format, assessing your strengths and weaknesses, and using these exams to guide your study plan, you'll be better prepared and more confident when taking the actual exam.
Tip 4: Take a good crash course before your exam
Participate in a real estate license crash course: These intensive courses can help you review essential concepts and provide tips for passing the exam.
Participating in a real estate license crash course is an effective strategy for passing the real estate exam. These focused review courses offer numerous benefits that help you consolidate your knowledge and refine your test-taking skills. A highly recommended crash course can be found at www.crashcourseonline.com.
Real estate crash courses provide:
• A comprehensive review of essential concepts.
• Expert guidance from experienced instructors.
• Time-efficient learning.
They also offer valuable test-taking strategies and networking opportunities with aspiring real estate professionals.
When choosing a crash course, consider its reputation, content, format, and cost. Look for a system with a strong track record, such as the one at www.crashcourseonline.com. Ensure the course covers all relevant topics included in your state's real estate exam and that the format aligns with your learning preferences and schedule. Lastly, compare the fees of various crash courses to find one that fits your budget.
In conclusion, enrolling in a real estate license crash course, like the one found at www.crashcourseonline.com, can be a game-changer in your exam preparation. These courses can significantly increase your chances of passing the real estate exam and kickstarting your career in the industry.
Tip 5: Stay updated on industry news
Staying updated on industry news is essential to preparing for the real estate license exam. While the exam may not directly test you on the latest news, keeping abreast of industry trends and developments has several benefits that contribute to your overall success as a real estate professional.
Firstly, staying informed about the real estate market helps you maintain a strong connection with the industry. This connection fosters a sense of motivation and enthusiasm, which can positively influence your attitude and drive when preparing for the exam. As you gain insights into the latest trends, you're more likely to be engaged and eager to learn, which can improve your study sessions' effectiveness.
Secondly, following industry news can also contribute to understanding broader real estate concepts, making it easier to grasp the principles and regulations tested in the exam. By observing the practical application of these concepts in real-world scenarios, you'll develop a more profound comprehension that can help you tackle exam questions with greater confidence.
Lastly, immersing yourself in the real estate industry news helps you build a solid foundation for your future career. As you enter the field, having an informed perspective on market trends and developments will enable you to serve your clients better and make well-informed decisions. By cultivating this habit early, you set the stage for continued growth and success as a real estate professional.
Tip 6: Understand state-specific requirements
Familiarize yourself with the licensing requirements specific to your state, such as how to get your California real estate license.
Remember that the real estate test doesn’t require that you ace the exam. The exam is qualifying in nature only, so don’t beat yourself up trying to score a 100%. Just score better than 70% on the sales exam or 75% on the broker exam and you’ll be good.
Since the test is qualifying in nature only, when you pass the exam your score isn’t even reported. :)
Tip 7: Manage test anxiety
Practice relaxation techniques, such as deep breathing and visualization, to help you stay calm and focused during the exam.
Managing test anxiety is essential for optimal real estate license exam performance. Stress can hinder your ability to focus, recall information, and think critically – all these skills for test success. Relaxation techniques like deep breathing and visualization can significantly reduce anxiety and help you maintain a calm, focused mindset during the exam.
Deep breathing exercises can lower your heart rate and stabilize your nervous system, while visualization techniques allow you to rehearse a successful exam experience, boosting your confidence mentally. By incorporating these relaxation strategies into your exam preparation, you improve your overall well-being and increase your chances of achieving a high real estate license exam score.
Tip 8: Belief in yourself
Stay confident in your abilities and trust that your hard work and preparation will pay off.
By following these tips and taking advantage of the resources available through an online real estate school and real estate license crash course, you can set yourself up for success on the exam.
In conclusion, passing the real estate license exam is a crucial milestone in your journey toward becoming a successful real estate professional. Utilizing these 7 tips outlined in this blog post will make you well-prepared to tackle the exam confidently. From choosing suitable study materials and developing a consistent study schedule to taking practice exams and managing test anxiety, these strategies will ensure you cover all necessary material and are ready for the challenges of the exam. Dedication, discipline, and effective time management are crucial to success. Embrace the journey, stay confident in your abilities, and soon you'll be ready to embark on an exciting and rewarding career in real estate.
Love,
Kartik
|
What Is A Real Estate Exam Prep Course?
A prep course for the real estate exam is an essential tool for any aspiring real estate agent. These courses provide comprehensive learning materials and resources
What Is A Real Estate Exam Prep Course?
A prep course for the real estate exam is an essential tool for any aspiring real estate agent. These courses provide comprehensive learning materials and resources designed to prepare and ensure exam success. Often
|
Buying a house and obtaining a real estate loan can be confusing, especially if you're doing it for the first time. One important real estate finance term you should know about is a "subordination clause."
Buying a house and obtaining a real estate loan can be confusing, especially if you're doing it for the first time. One important real estate finance term you should know about is a "subordination clause." I wanted to write an article explaining this clause and why it matters. We'll also show you how attending a real estate school or taking a real estate crash course can help you learn more about this and other real estate topics.
How Are The Priority of Liens Generally Determined?
In real estate financing, lien priority refers to the order in which various lenders and creditors have a legal claim or right to the property as collateral in the event of a default by the borrower. The lien priority determines who gets paid first and how much they receive when the property is sold or foreclosed upon.
Generally, lien priority is determined by the date and time when the liens were recorded. Liens recorded earlier typically have higher priority than those recorded later.
Here's an example to illustrate how lien priority works:
Let's say John owns a property and takes out a mortgage loan with Bank A, which is recorded on January 1, 2021. Later that year, John took out a home equity line of credit (HELOC) with Bank B, which was recorded on October 1, 2021. Finally, in 2022, John defaults on both loans, and the property is sold at a foreclosure auction for $500,000.
In this case, Bank A's mortgage lien has priority over Bank B's HELOC lien because it was recorded earlier. Therefore, Bank A will receive its total outstanding balance of $400,000 from the foreclosure sale proceeds first, while Bank B will only receive the remaining $100,000 (if there is any left after paying off Bank A).
What is a Subordination Clause?
A subordination clause is part of a mortgage or loan agreement where what would otherwise be a senior lender agrees to stay in a subordinate position and allow a new loan to have priority over an existing one.
Why is a Subordination Clause Important?
If you have more than one loan on your house, like a first and a second mortgage, a subordination clause helps determine which loan gets paid back first if you can't pay. This is especially important if you want to refinance (get a new loan with better terms) or get a second mortgage.
How Does a Subordination Clause Affect Homeowners?
A subordination clause can make it harder to refinance your primary mortgage or get a second mortgage. If the lender for your second mortgage doesn't agree to a new subordination clause, you might not be able to refinance. Also, getting a second mortgage will have a higher interest rate and not as good loan terms since it will be in a lower priority position.
How to Learn More About Subordination Clauses and Real Estate
Understanding real estate can be challenging, but attending a real estate school online or taking a crash course can make it easier.
Subordination clauses in development deals - an example
Imagine a developer named Emily who sees an opportunity to build a new residential complex on vacant land. To acquire the land and finance the construction, she needed to secure two loans: one for the land purchase and another for the construction costs.
Emily approached Big Bank to obtain a loan for purchasing the land. Big Bank agreed to lend her the necessary funds and make a first mortgage on the property using the land as collateral. This meant that in case of a default, Big Bank would have the first claim on the property. Now, Emily also needed a construction loan to cover the costs of developing the residential complex. She went to another lender, Builder Finance, which agreed to lend her the construction funds. However, Builder Finance needed assurance that they would also have a claim on the property if Emily defaulted on her loan.
Emily, Big Bank, and Builder Finance agreed to a subordination clause in their contracts to resolve this issue. The subordination clause stated that although Builder Finance's lien on the property was recorded later, Builder’s Finance would have a first loan on the property, and Big Bank agreed to a subordination clause. This meant that if Emily defaulted on her loans, Builder’s Finance would have the first right to recover its funds from the property, and Big Bank would have the subsequent claim after Builder’s Finance was fully satisfied.
This arrangement allowed Emily to secure both the land and the construction loan she needed to complete her project.
Using a subordination clause, Emily and her lenders created a clear and fair hierarchy of claims on the property, facilitating the successful financing and development of her residential complex.
Are you studying for the real estate exam and need expert instruction related to complex topics? Visit www.crashcourseonline.com
Love,
Kartik
|
When preparing for the California real estate license exam or attending a real estate crash course, understanding the concept of easements is essential. An easement is a legal right that grants one party
When preparing for the California real estate license exam or attending a real estate crash course, understanding the concept of easements is essential. An easement is a legal right that grants one party the use of another party's property for a specific purpose, generally for access. Because many of our readers are preparing for the real estate exam, this article will prove helpful.
I also wanted to dive into what an easement is, what a prescriptive easement entails, how it is formed, how it can be terminated, and the commonality of such easements in California.
What is an Easement?
In the world of real estate, an easement is a special permission that lets someone use another person's land for a specific reason. Even though the property owner still owns the land, the person with the easement has the legal right to use the land in a certain way. Some common examples of easements are when someone needs to go through a neighbor's property to get to their own when utility companies need access to put in and take care of things like power lines, and when people share a driveway.
There are several situations where easements might be necessary or valuable. For example, suppose a person's property is located behind another person's property, and there is no other way to access their property. In that case, they might need an easement to cross their neighbor's land. This is called a "right-of-way" easement and ensures that the person can come and go from their property without any issues.
Utility companies also rely on easements to install and maintain critical infrastructure, such as power, gas, or water pipes. These easements give the utility company the right to access a property owner's land to work on the necessary equipment, ensuring everyone can access essential services.
Another typical example of an easement is neighbors sharing a driveway or pathway. In these cases, both property owners agree to let each other use the driveway or pathway to access their properties. This type of easement, known as a "shared-use" easement, helps neighbors work together to use their land and resources best.
Easements play a crucial role in real estate by allowing people to use another person's property for specific purposes. They help resolve potential conflicts and ensure everyone's property rights are respected while still meeting the needs of all parties involved.
Prescriptive Easement: Definition and Formation
Simply put, a prescriptive easement is a special kind of permission to use someone else's land, even if they didn't say it's okay. It happens when a person uses the land in a way everyone can see, and they keep doing it for a certain amount of time without stopping. In California, this time is five years. If the person meets these rules, they can get the legal right to keep using the land, and that's called a prescriptive easement.
Example:
Imagine a person named Bob who uses a path through his neighbor's yard to get to a park. Bob's neighbor, Sally, doesn't know about it and never said it was okay. Bob has used this path daily for five years, and everyone in the neighborhood knows about it. After five years, Bob can ask for a prescriptive easement, which means he can legally keep using the path through Sally's yard.
For a prescriptive easement to be legally recognized in California, the following elements must be satisfied:
1. Open and notorious use: The use of the property must be visible and apparent to the owner.
2. Continuous use: The property must be used consistently without interruption for the required period.
3. Hostile use: The use must be against the owner's wishes and without their consent.
4. Exclusive use: The use must not be shared with the owner or others with no legal property rights.
Terminating a Prescriptive Easement
There are several ways a prescriptive easement can be terminated in California:
1. Abandonment: If the easement holder stops using it for a significant period, it may be considered abandoned, thus ending the easement. In California, this period of abandonment is five years.
2. Release: The easement holder can voluntarily relinquish their rights to the easement in writing.
3. Merger: If the easement holder acquires the property subject to the easement, the easement is terminated as the two properties merge.
4. Court action: A property owner may file a lawsuit to challenge the validity of the easement or seek a court order to terminate it.
How Common Are Prescriptive Easements in California?
Prescriptive easements are relatively common in California due to the state's high population density and the prevalence of real estate disputes. They often arise when property boundaries are unclear, or neighbors have informally used a shared driveway or pathway for many years. It is crucial for property owners and those studying for the real estate exam to be familiar with the concept of prescriptive easements and their implications.
A real-life example of such a case was Warsaw v. Chicago Metallic Ceilings, Inc., 35 Cal. 3d 564 (1984). In this case, the plaintiff, Warsaw, claimed a prescriptive easement over a portion of the defendant's (Chicago Metallic Ceilings, Inc.) property. The disputed area was a strip of land that Warsaw had been using to access their property for parking purposes. The plaintiff had used the land openly, notoriously, and continuously for more than five years without the defendant's permission.
The California Supreme Court ruled in favor of Warsaw, granting them a prescriptive easement over the disputed strip of land. This case illustrates the concept of a prescriptive easement in California. It provides an example of how the courts may rule in favor of a party that has satisfied the requirements for establishing a prescriptive easement.
Understanding easements and prescriptive easements is vital for anyone pursuing a real estate license or preparing for the real estate exam in California. Real estate professionals should be aware of the formation and termination of prescriptive easements and their prevalence in the state to navigate property disputes and effectively protect their clients' interests. By mastering this concept, real estate professionals will be well-equipped to handle complex situations that may arise in their careers.
If you need help passing the real estate exam, visit us at www.adhischools.com and check out our free resources.
Love,
Kartik
|
Title vesting refers to the legal manner in which an individual or entity holds ownership rights to a piece of real property. It is a crucial aspect of property transactions, as it determines the rights,
Title vesting refers to the legal manner in which an individual or entity holds ownership rights to a piece of real property. It is a crucial aspect of property transactions, as it determines the rights, interests, and privileges of the property owners and how the ownership is transferred or inherited in the event of a sale, gift, or death. Understanding title vesting is essential for anyone involved in real estate transactions, as it impacts decision-making, estate planning, and dispute resolution, ultimately shaping the rights and obligations of all owners.
I’m sure you remember this if you took my real estate license course, but real estate agents should never give their clients advice on title vesting methods for several reasons:
Lack of expertise: Real estate agents are not licensed attorneys, and their expertise lies in facilitating property transactions, marketing, and negotiating deals. Title vesting involves complex legal concepts and ramifications that require a thorough understanding of property and estate law. Providing advice without the necessary legal knowledge can result in misinformation, potentially causing financial and legal issues for clients.
Legal liability: A real estate agent may inadvertently assume a legal duty of care to their clients by offering advice on title vesting methods. If the advice turns out to be incorrect or causes harm to the client, the agent may be liable for damages through a negligence or malpractice claim.
State licensing regulations: Most states have laws prohibiting real estate agents from engaging in activities reserved for licensed attorneys, such as providing legal advice on title vesting methods. Violating these regulations can result in disciplinary actions, including fines, suspension, or revocation of the agent's real estate license.
Client's best interest: Real estate agents have a fiduciary duty to act in their clients' best interests. By refraining from advising on title vesting methods, agents ensure that clients consult qualified legal professionals who can provide accurate, tailored advice that aligns with the clients' unique circumstances and objectives.
It’s important to remember that I’m writing this article to help folks trying to pass the real estate exam. This article also should not be viewed as tax or legal advice.
Real estate agents should avoid advising on title vesting methods to protect their clients' interests, maintain professional boundaries, comply with licensing regulations, and avoid legal liability. Instead, agents should recommend clients consult a qualified attorney to obtain accurate and appropriate guidance on title vesting matters.
Even though real estate agents can’t advise their clients on how to vest, aspiring real estate professionals preparing for the real estate license exam must have a solid understanding of various property ownership types, especially joint tenancy and tenancy in common. I wanted to compare the pros and cons of these co-ownership forms, highlighting their differences and significance in real estate law.
With the help of ADHI Schools’ online real estate classes and resources, candidates pursuing a California real estate license can enhance their knowledge of these key concepts but this article will serve as a good starting point even if you aren’t already enrolled.
Joint Tenancy
Joint tenancy is a popular title vesting method in real estate, allowing two or more individuals to own property with unique rights and protections. This section explores the concept of joint tenancy, its characteristics and provides an example of joint tenancy ownership to illustrate its practical application in real estate transactions.
Understanding Joint Tenancy
Joint tenancy is a form of co-ownership in which two or more individuals hold an undivided interest in a property. It is characterized by the presence of the "four unities": time, title, interest, and possession. To help you prepare for the real estate license exam, you can remember this by the acronym TTIP.
This means that all joint tenants acquire their interests in the property simultaneously (TIME), from the same deed or document (TITLE), with equal ownership shares (INTEREST), and have equal rights to possess and use the entire property (POSSESSION).
One key feature that sets joint tenancy apart from other forms of co-ownership is the "right of survivorship." When one joint tenant dies, their interest in the property automatically passes to the surviving joint tenants, typically bypassing probate and avoiding potential delays and costs associated with the probate process.
Example of Joint Tenancy Ownership
Consider a married couple, John and Jane, who decide to purchase a home together. They opt for joint tenancy as their title vesting method. As joint tenants, they each hold an undivided 50% interest in the property and have equal rights to use and occupy the entire home.
The right of survivorship plays a crucial role in their ownership arrangement. If John were to pass away unexpectedly, his interest in the property would automatically transfer to Jane, making her the home's sole owner. This transfer occurs outside of the probate process, providing Jane with immediate, uninterrupted access to the property.
As joint tenants, John and Jane must make unanimous decisions regarding the property's management, maintenance, and any potential sale. This consensus requirement helps ensure that both parties' interests are considered and respected.
Conclusion
Joint tenancy is a widely used title vesting method in real estate, offering unique benefits to co-owners, such as the right of survivorship and equal ownership interests. Understanding the concept of joint tenancy and its implications is essential for individuals considering this form of co-ownership, as it directly impacts their rights, obligations, and estate planning strategies. By examining the example of John and Jane's joint tenancy ownership, we can better understand this title vesting method's practical application and advantages in real-life scenarios.
Pros and Cons of Joint Tenancy
Pros:
1. Right of survivorship: Joint tenancy comes with the right of survivorship, meaning that when a joint tenant dies, their interest in the property passes automatically to the surviving tenants. This avoids probate, saving time and expenses. This could be a benefit to joint tenancy.
2. Equal ownership: All joint tenants hold equal ownership interests and possess the same rights, ensuring fairness among co-owners.
3. Simplified decision-making: As all joint tenants have equal rights and interests, decision-making related to the property's management and use is more straightforward.
Cons:
1. Limited control: Joint tenants cannot independently sell, transfer, or encumber their share of the property without affecting the entire ownership structure.
2. Potential disagreements: Equal ownership rights and interests may lead to disputes among joint tenants, as all decisions must be unanimous.
3. Inflexible ownership shares: Joint tenancy requires equal ownership shares, which might not suit all co-owners' preferences or financial situations.
Tenancy in Common
Tenancy in common is a prevalent title vesting method in real estate that enables two or more individuals to own property together while retaining separate and distinct interests. In this section of this article I wanted to delve into the concept of tenancy in common, its characteristics and provides an example of tenancy in common ownership to demonstrate its practical application in real estate transactions.
Understanding Tenancy in Common
Tenancy in common is a form of co-ownership in which two or more individuals hold separate and distinct interests in a property. Unlike joint tenancy, tenancy in common does not require the presence of the "four unities" – time, title, interest, and possession. This means that tenants in common may acquire their interests in the property at different times, through different documents, or in unequal shares. However, all tenants in common have equal rights to possess and use the entire property, regardless of their ownership shares.
A critical difference between tenancy in common and joint tenancy is the absence of the "right of survivorship" in a tenancy in common when a tenant in common dies, their interest in the property passes to their heirs or designated beneficiaries, as outlined in their will or state intestacy laws, rather than automatically transferring to the surviving co-owners.
Example of Tenancy in Common Ownership
Consider three friends, Alice, Bob, and Carol, who decide to invest in a vacation property together. They choose tenancy in common as their title vesting method due to its flexibility in ownership shares. Alice contributes 50% of the purchase price, while Bob and Carol each contribute 25%. While not required, their ownership interests in the property reflect their respective contributions:
Alice owns a 50% interest, while Bob and Carol each own a 25% interest.
Since there is no right of survivorship in a tenancy in common, if Alice were to pass away, her 50% interest in the property would not automatically transfer to Bob and Carol. Instead, her interest would pass to her designated beneficiaries or heirs according to her will or state laws covering the property of a deceased when they die with no will - also called intestate.
As tenants in common, Alice, Bob, and Carol must collaborate on property management, maintenance, and potential sales decisions. However, each tenant in common has the freedom to sell or transfer their interest in the property without the consent of the other co-owners.
Conclusion
Tenancy in common is a widely used title vesting method in real estate, offering unique benefits to co-owners, such as flexible ownership shares and the ability to transfer interests independently. Understanding the concept of tenancy in common and its implications is crucial for individuals considering this form of co-ownership, as it directly impacts their rights, obligations, and estate planning strategies. By examining the example of Alice, Bob, and Carol's tenancy in common ownership, we can better understand the practical application and advantages of this title vesting method in real-life scenarios.
Pros and Cons of Tenancy in Common
Pros:
1. Flexible ownership shares: Tenancy in common allows co-owners to hold unequal property shares, making it a more flexible option for parties with differing financial capacities or preferences.
2. Independent control: Tenants in common can more easily sell, transfer, or encumber their share of the property without the consent of other co-owners compared to a joint tenancy vesting.
3. Customizable estate planning: Tenancy in common enables co-owners to choose their property share's beneficiaries, offering greater freedom in estate planning.
Cons:
1. No right of survivorship: Tenancy in common lacks the right of survivorship, which means that a co-owner's share of the property passes through probate upon their death, potentially causing delays and expenses.
2. Complex decision-making: As tenants in common may hold unequal shares, decision-making related to property management and use can be more complicated, especially if there are disagreements among co-owners.
3. Potential partition risks: In case of disputes or a desire to sell, tenants in common may face the risk of court-ordered partition, which can lead to a forced sale or physical division of the property.
In preparation for the real estate license exam, it is essential to understand the pros and cons of joint tenancy and tenancy in common and their legal implications. Our real estate classes for obtaining a California real estate license can provide you with the necessary knowledge to navigate these critical co-ownership concepts on the real estate test confidently.
Love,
Kartik
TLDR: Title vesting determines the ownership rights and transfer of property in real estate transactions, and it's important to understand the different methods available. Real estate agents should avoid giving advice on title vesting due to lack of legal expertise, legal liability, state licensing regulations, and the clients' best interests. Two common co-ownership forms are joint tenancy and tenancy in common. Joint tenancy offers the right of survivorship, equal ownership, and simplified decision-making, but limited control and potential disagreements. Tenancy in common allows for flexible ownership shares, independent control, and customizable estate planning, but lacks the right of survivorship, has complex decision-making, and potential partition risks. It's important to understand the pros and cons of these methods and their legal implications for the real estate license exam
|
Preparing for your real estate exam involves looking at a number of concepts that are likely to be on your exam. Financing is one such topic that is worth directing some of your time to. The DRE says
Preparing for your real estate exam involves looking at a number of concepts that are likely to be on your exam. Financing is one such topic that is worth directing some of your time to. The DRE says that 9 percent of the exam covers financing and a financing concept that is commonly tested is “amortization”.
Amortization of a loan refers to the process of paying off a debt with regular and fixed payments over a specified period of time. Each payment includes a portion allocated to both principal and interest.
Principal is the amount of each payment that actually goes to reducing the amount owed. Interest is the fee that is charged for borrowing the money.
The word "amortization" comes from an Old French word "amortir," which means "to kill" or "to deaden." This is rooted in medieval times and idea was that each payment would "kill off" a portion of the debt, reducing it gradually until it was fully paid off.
The modern financial meaning of the term, which refers to the gradual repayment of a loan through regular payments that include both principal and interest, evolved from this earlier usage.
Example: You borrow $800,000 to buy a house and pay off the loan over the 30 year term. At the end of the 30 years, the loan has been “fully amortized”.
In simple terms, amortization breaks the loan into smaller and more manageable payments over a set period. As an example, in the case of a car loan the time to “fully amortize” or “kill” the loan is typically 4-7 years. In the case of a home mortgage, the loan term is usually either 15 or 30 years.
Every loan has an amortization schedule which outlines the amount of the payment and shows the portion of each payment that goes towards paying off the principal and interest.
Because amortization “kills” the loan, each payment made during the amortization period reduces the outstanding balance of the loan by some amount. In the early part of the payment schedule, most of the payment goes towards interest, but as the loan progresses, more of the payment goes towards reducing the principal.
Over time, the amount of interest paid decreases, while the amount of principal paid increases. At the end of the loan term, the full amount borrowed is “amortized”, and the borrower owns the property outright.
Not all loans are full amortized. For example, there is another type of loan known as a straight note or interest-only loan. In this arrangement, the borrower makes interest-only payments and none of the payment goes to actually reduce the principal balance.
Straight notes may be used in certain situations, such as when a borrower expects to have a large amount of cash available at a future date to pay off the principal balance, or when a borrower needs lower monthly payments in order to afford the property.
However, straight notes can be risky for borrowers because they may result in higher overall interest costs, larger future payments, and potentially owing more on the loan than the value of the property. As a result, straight notes are generally less common than fully amortized loans in the mortgage industry.
So which loan is better?
Whether a fully amortized loan or a straight note is better depends on the specific circumstances of the borrower and their financial goals.
A key benefit to the fully amortized product is that it results in the loan being completely paid off at the end of the loan term. This type of loan provides predictability and stability in terms of payment amounts and a clear path toward paying off the debt.
As mentioned earlier, a straight note requires the borrower to pay only interest on the loan for a set period of time. This type of loan can result in lower monthly payments and may be beneficial for borrowers who need more flexibility in their monthly budget. However, because the principal balance is not being paid down during the interest-only period, the borrower will need to make larger payments or refinance the loan to pay off the principal at the end of the interest-only period.
In general, a fully amortized loan may be a better choice for borrowers who want to build equity in their property and pay off the debt over a set period of time, while a straight note may be a better choice for borrowers who need lower monthly payments in the short term but are willing to take on the risk of potentially higher payments in the future. Ultimately, borrowers should carefully consider their financial goals and the terms of each loan option before making a decision.
There is another type of even riskier loan product common before the financial crisis of 2008 is known as negative amortization. It’s called negative amortization because instead of the loan balance going down, in negative amortization the loan balance actually goes up.
The reason the balance rises in negative amortization is because the payments are not sufficient to cover the interest owed on the loan, resulting in the interest being added to the principal balance. This means that the borrower's loan balance actually increases over time rather than decreasing as it would with a fully amortized loan.
Negative amortization typically occurs with certain types of loans that have adjustable interest rates, such as option adjustable-rate mortgages (ARMs), or payment option loans. These loans offer a low initial payment, often resulting in a payment that is less than the interest that is accruing on the loan, causing the unpaid interest to be added to the loan balance.
Although the payment on a negative amortization loan is much lower compared to even a straight-note, this type of loan has several horrific consequences for borrowers, including increased interest costs over the life of the loan, larger payments in the future, and potentially owing more on the loan than the original amount borrowed. Therefore, borrowers should carefully consider the terms of their loan and ensure that they can afford the payment amount both currently and in the future.
Because of all these risks associated with the negative amortization product, when Arnold Schwarzenegger was governor, California passed legislation actually banning new negative amortization loans.
Federally the Truth in Lending Act (TILA) requires lenders to disclose the terms of a loan, including the payment schedule, interest rate, and total cost of the loan over its term. Additionally, the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 includes provisions that require lenders to evaluate a borrower's ability to repay the loan, which has led to tighter regulations on certain types of loans, including those with negative amortization.
If you are reading this article and want practice questions related to real estate finance to prepare you for your real estate exam, I’d recommend checking out our exam prep website for tons of practice questions and updated content.
At the end of the day, fully amortized loans can offer several benefits for borrowers, including:
Predictable payments: With a fully amortized loan, the borrower knows exactly how much they will need to pay each month and over the life of the loan. With an interest only loan, on the other hand, there may be a balloon payment at the end of the loan or a variable rate after some fixed period. Full amortized loans can make budgeting and financial planning easier and more predictable.
Reduced interest costs: By design, fully amortized loans are created so that the borrower pays off the loan balance over a set period of time. Because of this borrowers will typically pay less in interest costs over the life of the loan compared to other types of loans, such as interest-only or balloon loans.
Equity buildup: As time goes on and the borrower makes payments on a fully amortized loan, the loan balance gradually decreases, resulting in an increase in equity in the property. Combine this with expected appreciation of the home and equity can start to build quickly- no doubt an important factor for homeowners who plan to sell the property in the future or use it as collateral for another loan.
Lower financial risk: Fully amortized loans offer a lower level of financial risk for owners because the loan balance is gradually paid down over time, reducing the risk of owing more on the loan than the property is worth.
Potential tax benefits: In some cases, the interest paid on a fully amortized loan may be tax-deductible, which can result in additional savings for the borrower.
Overall, fully amortized loans offer borrowers a stable and predictable path towards paying off their debt, with lower overall interest costs and reduced financial risk. Much of the real estate industry (and society at large) learned their lesson in 2008 when borrowers got risky adjustable rate and interest only loans in the few years prior.
As always if you are interested in taking real estate classes with our school and for in-depth instruction to help you pass the real estate exam visit www.adhischools.com.
Love,
Kartik
|
Part of preparing for the real estate exam involves studying as much vocabulary as possible. One vocabulary word that is worth reviewing is the word “lien”. The purpose of this article is to go over
Part of preparing for the real estate exam involves studying as much vocabulary as possible. One vocabulary word that is worth reviewing is the word “lien”. The purpose of this article is to go over a few different examples of liens that are commonly tested on the real estate exam. You might have already read my article on encumbrances - if not that link is worth reading once you are done with this more specific article.
While reading this, bear in mind that liens are quite common and don’t always need to be viewed as scary or fatal to the title to real estate.
Simply put, a lien is a claim or legal right that a creditor has against a property to secure payment of an obligation or other debt by the property. If the debt is not paid, the creditor may have the right to sell the property through foreclosure.
Some liens can affect all property of a debtor. These are called “general” liens and are so called because they affect everything that a debtor might own. Examples of general liens might include judgements and income tax liens.
Other liens are known as “specific” and only affect one particular property. As an example, a mortgage lien is a specific lien because the lien only pertains to the property on which the loan is placed. Imagine you have two houses, one in Los Angeles and another in San Diego. If you refinance your house in San Diego and put a mortgage on it the lien only relates to the San Diego home and not the house in Los Angeles - hence mortgage liens are “specific”.
There are several other types of liens that can be placed on real estate and I’ve outlined some of the most common below. These are worth memorizing and understanding so you have context for the state exam. You might remember a lot of this from real estate school but this article is worth it as a refresher.
Property Tax Liens: As the name suggests, property tax liens are filed by the government to secure payment of delinquent property taxes. If the taxes are not paid, the government may have the right to foreclose on the property. The lien is typically recorded in the county where the property is located and becomes a part of the public record.
If a property tax lien is filed against a property, it may impact the ability of the owner to sell or refinance the property until the taxes are paid or the lien is removed. Again, in some states, the government may have the right to sell the property at a tax sale if the taxes remain unpaid for a specified period of time.
Income tax liens: Like property tax liens, income tax liens can have a significant impact on real estate. An income tax lien is a claim made by the government to secure payment of delinquent income taxes owed by an individual or a business. If an individual or a business fails to pay their income taxes, the government may place a lien on real property to secure payment of the taxes owed.
The income tax lien is recorded at the county in which the property is located and becomes part of the public record. The lien provides the government with a legal claim to the property and gives them the right to foreclose on the property if the taxes remain unpaid. The specific requirements for filing an income tax lien vary by state, so it is important for property owners to be aware of the laws in their jurisdiction.
Mechanics Liens: No - this lien doesn’t have anything to do with leaving your car too long at the mechanic. A mechanics lien is a claim by a contractor, subcontractor, or supplier to secure payment for work performed or materials supplied for the improvement of real property.
A mechanics lien provides a legal claim to the payment for work performed or materials supplied on a property and allows the contractor, subcontractor, or supplier to potentially foreclose on the property if the debt is not paid. The mechanics lien is typically filed with the local government and recorded in the county where the property is located.
In order for a mechanics lien to be valid, certain requirements must be met, such as proper notice to the property owner, the use of proper forms, and timely filing of the lien.
If a mechanics lien is filed against a property, it may impact the ability of the property owner to sell or refinance the property until the debt is paid or the lien is removed. It is important for property owners to monitor any liens that may be filed against their property and to take steps to resolve any liens in a timely manner.
Judgment Liens: A judgment lien is a claim by a creditor to secure payment of a debt that has been awarded in a court of law. This type of lien can be filed against a property if the debtor loses a lawsuit and is ordered to pay.
The judgment lien is typically filed with the local government and recorded in the county where the property is located.
Homeowner Association Liens: A homeowner association (HOA) lien is a claim by a homeowner association to secure payment of delinquent HOA fees or assessments owed to the association. If the fees or assessments are not paid, the homeowner association may have the right to foreclose on the property.
This type of lien is filed by a homeowner association to collect unpaid fees for common area maintenance, landscaping, security, and other services provided to homeowners in the association.
It is important for real estate owners to understand the liens that may be placed and to take steps to prevent or resolve any liens that may be filed against their property. This may involve paying any delinquent debts or taxes, negotiating with creditors, or consulting with a real estate attorney.
In conclusion, liens are a way for creditors to secure payment of a debt or obligation related to a property. Liens can have a significant impact on the ownership and value of a property and it is important for real estate owners to understand the liens that may be placed on their property and to take steps to prevent or resolve any liens that may be filed against their property.
As always - if you are interested in taking real estate classes with our school reach out at www.adhischools.com
Love,
Kartik
|
As you prepare for your real estate exam you’ll no doubt take at least one of our crash courses. These lectures and online tools can be done in the comfort of your own home and are based on individual
As you prepare for your real estate exam you’ll no doubt take at least one of our crash courses. These lectures and online tools can be done in the comfort of your own home and are based on individual self-study.
But what if you aren’t quite ready for a real estate crash course yet? What if you still need to complete Real Estate Principles, Real Estate Practice and the elective course in real estate school?
While we offer an amazing self-study program to help you finish the required courses there are some students who don’t do well left to their own devices. Does this sound like you?
What if you wanted a professional instructor who walked you through the course material, but didn’t need to drive to a physical location? A plus with gas prices being $7 a gallon.
To bridge the gap between total self-study and a physical real estate school we offer an amazing Zoom-based option.
I made a list of seven benefits of this program to prepare and qualify for the California real estate exam.
1. Eliminate procrastination
By coming to our scheduled Zoom calls, you’ll be less inclined to put off studying the material to qualify for the exam. When working independently, it’s easy to procrastinate, but when you make a commitment to meet with our study group you’ll be more motivated to press on and prepare so you’re ready to cover the material with other group members.
2. You’ll Probably Learn Faster
Members of study groups like those on our Zoom calls tend to learn faster than individuals who work independently. With any type of learning, it’s common to get stuck on a concept and have difficulty getting over the proverbial learning hump. With fellow students and an instructor to talk out concepts with, it can clarify some of the drier material.
3. Fill in Gaps in Notes
While you might prepare for class by watching some of the videos on our YouTube channel questions might arise as you watch the videos or read the textbooks.
Bring you questions to class and the instructor will answer them and encourage you to deep-dive into the course material. You can read the book on your own first, knowing that if you do have a question you’ll be able to ask it to the instructor and bounce ideas off other students in the process.
As a result, fewer gaps exist, when it’s time to take the real estate exam you’ll be better prepared.
4. Sharpen Your Study Skills
Everyone has their own techniques they use to study. However, working with a diverse group of other hopeful real estate agents empowers you to sharpen your own study skills. You’ll be able to learn from the strengths of others and maybe even share your own with them.
5. Break Up Monotony of Studying Alone
Studying alone is very monotonous and it could lead to feelings of isolation, frustration, and loneliness. On the other hand, working with a group pursuing the same goals not only adds socialization, it gives you something to look forward to nearly daily. Check out our schedule of Zoom classes here! <hyperlink to https://www.adhischools.com/schedule >
6. Hone Your People Skills
Working as a real estate agent means you’ll need to hone your people skills if you don’t already possess them. Success in our industry is based on your ability to work with other people. In study groups, you’ll encounter a variety of personalities and this will strengthen your ability to communicate with different people - a must in real estate!
7. Get a Jump on Networking
In a sense, a study group can be your first step into developing your professional network. In any industry, it’s not what you know, but who you know. Often, those on our Zoom calls have built a sense of camaraderie – the perfect seed to grow a professional network. Remember, not only can you connect with members of your group, but they can introduce you and vice versa to other people. Knowing you have friends in real estate upon passing your exam is a great feeling - It’s never too soon to build a professional network!
In order to pass California’s licensing exam you’ll need to gain a full understanding of the topics and concepts used in everyday real estate business. Joining our Zoom calls can put you on a solid path.
If you are interested in getting a free guest pass to check out one of our Zoom study sessions, click here and pick a day and time that works for you. I look forward to seeing you on an upcoming real estate Zoom call!
Love,
Kartik
|
Imagine you have completed all the required classes at our real estate school <Hyperlink to https://www.adhischools.com > and now you are in the process of studying for your real estate exam. You’re
Imagine you have completed all the required classes at our real estate school <Hyperlink to https://www.adhischools.com > and now you are in the process of studying for your real estate exam. You’re probably taking our real estate crash course <Hyperlink to https://www.crashcourseonline.com > and are focused on prepping for the test.
You can probably tell from our hundreds of 5 star reviews <Hyperlink to https://www.yelp.com/biz/adhi-schools-newport-beach > that we know a thing or two about getting students to pass their real estate exam <Hyperlink to https://www.adhischools.com/real-estate-exam-app >. Still,I wanted to write a quick blog outlining a few things that can actually make it harder to pass your test so you know what not to do.
I’ve read some other articles from folks that incorrectly say that the real estate test is purposely and unnecessarily difficult. This isn’t really the case. If you understand the concepts and study you should have no problem passing.
I’ve read some other articles from folks that incorrectly say that the real estate test is purposely and unnecessarily difficult. This isn’t really the case. If you understand the concepts and study you should have no problem passing.
Consider the below list as you do:
Bad Prep Materials or a Bad Exam Prep Program
Call me a little biased, but I think that our real estate crash course <Hyperlink to https:// www.crashcourseonline.com > is the best way to study for the real estate test out there. There are alternative products in the marketplace that aren’t California specific or that are written by people who have never even taken the real estate exam.
Obviously, the purpose of real estate exam prep material is to increase comprehension of the subject matter.Understanding that most people are on their mobile devices the majority of the time, our team developed an app <hyperlink to https://www.https://www.adhischools.com/real-estate-exam-app > for Android and iOS devices that is second to none. If you don’t have this yet, get it!
In the end, prep materials that do not play to your strengths decrease your chances of passing the real estate exam.
2. Too Much Study Time on What’s Not Important
One of the common mistakes real estate examinees make is focusing on items not likely to be on the exam. What too often occurs is that folks can get bogged down in the minutia and lose focus on critical concepts and facts. Some call this not “seeing the forest through the trees.”
I cringe when students send me articles about how to study for the “math portion” of the real estate test or 50 questions on the history of California. The truth is that there is very little actual arithmetic on the real estate test so spending 15 hours studying how to calculate capitalization rates isn’t going to do much good when there are other topics that appear far more frequently on the exam.
The good news about our crash course system <hyperlink to https://www.crashcourseonline.com > is that questions are weighted in the same ratio that the actual real estate exam is. Our system is organized in a fashion that emphasizes primary concepts and focuses your study time in ways that actually matter.
The point is that investing too much of your limited time in minutia might not be a good decision.
3. Procrastination
Procrastinators of the World Unite! Tomorrow.”
People from all walks of life come up with seemingly good reasons to put off studying. These rank among the common reasons people procrastinate.
Feeling Overwhelmed
Lack of Urgency
Lack of Discipline
Don’t Like to Study
Can’t Choose a Starting Point
Giving in to these and other inclinations puts potential real estate professionals behind the knowledge curve. The sooner you crack open the materials and begin learning at a deeper level, the better your chances of passing the test.
I would recommend doing all the questions in the training mode of our real estate crash course <hyperlink to https://www.adhischools.com/real-estate-crash-course/california > at least twice before attempting a mock exam. Focusing on our training mode will expose you to all the questions in our system and eliminate any false confidence from a high score on a random mock exam.
4. Failing to Follow a Study Plan
Possessing an actionable study guide and plan cures some of the reasons to procrastinate. Of course, potential real estate professionals will need to leverage a study plan in a timely and orderly fashion. Common missteps involve jumping around and prioritizing topics you feel comfortable studying. Such practices are more a lack of discipline than an attempt to gain high-level knowledge.
It’s essential to use a study plan designed to build one concept on another. Like many other industries and disciplines, real estate knowledge tasks people with possessing a broad understanding of how things intersect. Rifling through study materials and jumping ahead typically results in fragmented ideas that don’t translate to sound professional skills.
Remember to set aside plenty of time before the test to ensure that you don’t feel overwhelmed - This leads me to my final point.
5. Test Anxiety and Last Minute Cramming
When I was in high school and college, I would love the adrenaline rush of studying for an exam at the absolute last minute and leaving with a good score. While exhilarating, it’s important to realize that the real estate exam should not be approached in this manner. There is far too much material to only study the night before. A study schedule at least two weeks before the test will help you stay focused and ensure you have ample time to review and understand the material.
It’s totally normal to feel a little on edge before the exam starts. Issues such as self-doubt or fear of failure can derail efforts to pass the real estate exam. The good news is that test anxiety does not have to stop you from beginning a new career.
TLDR:
Learn to Study Effectively
Establish a Study Routine
Practice Relaxation Strategies
Exercise, Eat Well, Hydrate, and Get Restful Sleep
Reach out to our office at 888 768 5285 or shoot us a message if you’re having a hard time passing the test.
Love
Kartik
|
Broadly speaking, an encumbrance is some “burden on the title” to a piece of property. If you’re reading this article, you probably already have been exposed to the term “encumbrances” in
Broadly speaking, an encumbrance is some “burden on the title” to a piece of property. If you’re reading this article, you probably already have been exposed to the term “encumbrances” in Real Estate Principles but I wanted to write a quick article about it as a refresher.
I chuckle when I hear people say things like “I would never buy a home with an encumbrance!” because this is essentially an impossible request. All properties are going to be encumbered in some way whether either through zoning regulations, private restrictions like CC&Rs when buying a condo or even something as common as a mortgage.
Encumbrances are of two basic types. Some involve money and others do not involve money. In the sale of California real estate, sellers are required to disclose encumbrances on a property and generally a title insurance company is a backstop to ensure that buyers are made aware of any encumbrances on a property prior to the purchase.
An encumbrance may or may not affect the value of the property – it depends on the type of encumbrance. There are some encumbrances like a lis pendens (explained below) that may prevent the sale of the property altogether.
Mortgages and Deeds of Trust
Mortgages and trust deeds are among the most common types of encumbrances out there. Any time a buyer of real estate gets a loan on a property the lender will place a deed of trust or a mortgage against it. I know we are accustomed to calling any home loan a “mortgage” but in California the instrument is actually a deed of trust.
These are very common encumbrances on a piece of real estate because most properties are not purchased cash.
If you’re interested in learning more about the differences between a mortgage and a trust deed I recoded a YouTube video about it here.
Deed Restrictions
A private owner might restrict the use of his or her property in some way. These restrictions usually stay with the property upon transfer. For example, a member of a church may decide to donate some land to the church on the condition that it be used only for religious purposes.
Prior to the enactment of civil rights legislation, there may have been race or other (now illegal) conditions prohibiting the sale to members of a specific ethnic minority group or religion. Such deed restrictions are neither valid nor enforceable
Zoning
Zoning is a public control on real estate. Every city and county in California is required to have a comprehensive, long-range plan for development within an area. This plan is known as the general plan. If you need a refresher on this, check out this link.
Even though most people do not think of zoning as an encumbrance, it is in fact an encumbrance. For example, a property that is zoned residential generally cannot be used for a commercial business - making it encumbered in some way.
Liens
A property could have voluntary or involuntary liens. A voluntary lien is one that is freely agreed to by the property owner. Reading that, you might wonder why anyone would voluntarily place a lien on their property but these liens are actually very common in the form of mortgages and trust deeds which I outlined below.
On the other hand, involuntary liens are those that get placed on a property by operation of law. Examples of involuntary liens include property tax liens, income tax liens, mechanic’s liens, and lis pendens. These liens are involuntary because the property owner does not need to specifically authorize the creation of the lien. The lien is created by law.
From your real estate crash course you might remember that a mechanic's lien is one that a party can place on your property if you did not pay for labor, services, material or equipment used upon a property.
Mechanics liens (like all liens) are another example of an encumbrance.
Easements
An easement is a type of encumbrance that gives others permission to use a portion of property - often for access. Imagine there are two houses, one in the front and one in the back. Let’s say the only way that the back house can get home is to cross over the front house. The right of way over the front house is known as an easement.
Another example of an easement is an easement in gross which mostly involves utility companies. The water utility, for example, typically has the right to lay underground water pipe through a subdivision and the electricity company will typically have the right to string wires over a subdivision.
Encroachment
An encroachment is a physical invasion of another’s property. Examples of encroachments include walls being built extending onto a neighbor’s property line, structures being built across boundaries or even airspace encroachments where branches of trees extend into an adjacent parcel, for example.
It may be challenging to sell a property that has an encroachment upon it.
A solid understanding of encumbrances will help you not only pass your real estate examination, but also be in a better position to help your clients.
If you need more help passing the real estate exam, call us at 888 768 5285 and we can help.
Love,
Kartik
|
![]()
If you are enrolled in our California real estate school , no doubt you would have seen the term “easement” pop up in your studies.
Simply put, easements in real estate are the right of
If you are enrolled in our California real estate school , no doubt you would have seen the term “easement” pop up in your studies.
Simply put, easements in real estate are the right of one party to travel over the land of another for access.
What is an example of an easement?
Consider the case where there are two properties adjacent to one another- a front house and a back house. Assume that the only way the owner of the back house can get to their property is by crossing over the front property. The right of the back house to travel over the front house is known as an easement.
Who are the parties in an easement?
Since the back house has the legal right to travel over the front house for access, the owner of the back house is known as the “dominant” tenement. Because the front house is burdened by the easement they are known as the “servient” tenement.
While the simple example of a front house and a back house is the most common type of easement, there are others as well. For example, an electric company might have the right to string wires over a subdivision or a water utility might have the right to lay underground water pipe through an area. These are also types of easements, but they are known as easements in gross.
So how do you know if you have an easement?
Easements in real estate are almost always recorded with local authorities such as county or city clerks' offices. A title search would reveal easements that cross the property, and would appear in a preliminary title report obtained through a title insurance company.
So how does an easement differ from a license?
If you are taking our real estate crash course you have seen a discussion around the differences between an easement and a license. A license is a personal right to cross over the land of another held by an individual or entity. Licenses are not associated with the land itself, rather they correspond to an individual. An easement, on the other hand, is an appurtenant right. That is, easements are associated with the real property itself and run with the land. As such, easements are transferred to the new owner upon the sale of the property.
Example of a license:
I give Betty the right to travel over my land. I specify that this right is exclusive to Betty and it is able to be taken away from Betty.
Analysis:
This is a license because the right to traverse my property is exclusive to Betty and it not tied to the land. Finally, the right to travel over my land is able to be taken away from Betty hence it is a license not an easement.
To reiterate, remember that an easement differs from a license based on the revocability of a license. In other words, an easement that is recorded in the county recorder’s office generally can’t be revoked by the servient tenement.
A few ways that easements can be terminated, however, are:
Release of the easement by quitclaim deed signed by the dominant tenement.
Merger of both the dominant and servient tenements.
Restruction of the servient tenement.
Abandonment of a prescriptive easement for at least 5 years.
But notice in an easement, the servient tenement cannot unilaterally terminate the easement like the grantor could do with a license.
In summary, remember that an easement is the right to cross over another’s land for access. This simple definition should help you on the real estate exam .
Love,
Kartik
|
Doing well on your real estate exam is the first step to getting your career going. If you are like some of our students, this can be a daunting thing especially if you’ve been out of school for a while.
Doing well on your real estate exam is the first step to getting your career going. If you are like some of our students, this can be a daunting thing especially if you’ve been out of school for a while.
It doesn’t have to be.
What’s important is that you understand the information necessary to pass the real estate exam. To help relieve some frustration and improve your chances of success, consider these study tips.
1. Review What’s on the Exam
Take a few minutes to review what’s on the actual real estate exam. If you were a student of ours, this is outlined for you in your Principles book. Merely having a basic understanding of what’s on the exam can calm a lot of fears for students.
The state publishes a percentage breakdown of topics that are tested and our real estate exam preparation website is tailored so the questions are in the same ratio that the government exam is. This way there are no surprises on test day.
2. Create Digital or Physical Notes for Key Concepts
As you are reviewing your notes from your pre-license coursework, consider creating notecards or flashcards with key concepts. Write them in a question format with the answer on the back. There are flashcard apps you can use as well if you want to have access to studying on your phone.
Also, it’s been proven that the act of physically writing things down can go a long way to help retain information.
3. Read Your Notes
If you haven’t done so yet, read through all of the materials you’ve been assigned. Create notes on topics that relate to your real estate exam. It’s a good idea to create notes for topics you are unsure about or very specific elements such as vocabulary terms or other more broad real estate concepts.
As you do, remember how important it is to retain this information. It’s not just about the exam, but it is applicable for day-to-day work as an agent. For example, if there’s a topic that is complex to you, look for a real-life example of how this would apply to your career or the work you do. That way, you’ll better understand what to expect.
4. Don’t Reach Out to Practicing Agents
I would avoid having long drawn out conversations with other real estate agents. Most of the time, they will say things like “Don’t worry what’s on the real estate exam, you won’t use any of that stuff anyway.” The constant repetition of how academic and impractical the concepts tested are can actually discourage some of our students from properly preparing and studying.
While it is true that the real estate exam contains a broad set of topics, all of which are not applicable to every deal, it’s still important to stay focused on the goal of actually passing the real estate exam.
If you can’t help yourself, make sure you talk to agents that support you in making key decisions and learning how to navigate complex topics. These agents can give you insight into real-life applications of the material you’re learning. They can also put your mind at ease.
5. Take Several Practice Real Estate Exams
It’s important to have state-specific real estate license practice exams available to you. You can find them on our website. Luckily for you, our system is modern and up to date to ensure they include the most recent updates to the real estate test itself.
Focusing on our real estate practice exams can point out areas where you need to focus a bit more on your studies. Refrain from taking them one after another. Instead, use them as you study to see areas you should focus on going forward.
6. Understand How To Take Tests
While the material you need to pass the real estate license exam is critically important to know, it’s also helpful to have some test-taking skills, especially if you haven’t dealt with high-pressure tests recently. Consider these strategies:
Read every word slowly in every question. Sometimes, you’ll miss words such as “if” or “all” – and that can change the answer.
Don’t rush through the test. Take your time to read the data and analyze it from a strategic view.
Breathe through your test. If you find yourself overwhelmed or under too much pressure, that’s when you know you need to close your eyes, breathe in deeply, and calm your heart rate.
Make sure you sleep well in the week leading up to your exam. Don’t binge the night before as that can limit your cognitive capacity later on.
Arrive on time for your test. Get a good idea of the layout of the area. You want to feel comfortable.
If you don’t know the answer to a question right away, skip it. You can go back to it later. Don’t put too much time into a single question.
Don’t rush through the exam. Make sure you take your time and focus.
If you’re really struggling with test-taking itself, do a few practice exams in a formal environment, such as in a library or office space. This can help give you some peace of mind.
7. Stay Positive and Upbeat
Passing your real estate exam is a step towards starting a new career. It is a lot of work – and that can seem like a big mountain to climb. However, focus on the big picture. This is a career that you are going to love. The more hands-on experience you have, the better your outcome will be.
Practicing for your real estate exam can be a very eye-opening experience. This is what you’ll soon be an expert in, helping others to achieve their goals of property ownership.
Love,
Kartik
|
