3321chapter 1

3321chapter 1 - Chapter 1: Introduction to Real Estate...

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Chapter 1: Introduction to Real Estate Investment: Legal Concepts Real estate: used to refer to things that are not movable such as land and improvements permanently attached to the land. Ownership rights associated with real estate are referred to as real property. Real property vs. personal property. Distinguish between physical real estate assets and ownership rights in real property because many parties can have different ownership rights in a given parcel of real estate… legal system allows way s for person fianancing or investing in real estate to be creative and to apportion these various interest among parties. Property right: the right of a person to the possession, use, enjoyment, and disposal of his property. Interest is a broad legal term used to denote a property right. Holder of an interest in real estate enjoys some right, or degree of control or use, and, in turn, may receive payment for the sale of such an interest. To the extent that it can be valued, it can be bought, sold, or used as collateral. Value of real estate can be viewed as the total price individuals are willing to pay for the flow of benefits associated with all of these rights. Lessee: person who leases land, may have the right to possession and exclusive use of a property for a period of time. A holder of a mortgage also has some rights as a nonowner in real estate pledged as security for a loan. Lender/mortgagee has a right to repossess or bring about the sale of a property if the borrower defaults on the mortgage loan. Although a lender may not possess or use the real estate, the mortgage document provides the lender with evidence of a secured interest. This right has value to the lender and reduces the quantity of rights possessed by the owner. All or a portion of rights may be restricted or transferred to others. Estate: all that a person owns. Real estate: all realty owned as a part of an individuals estate. Estates in real property :used to describe the extent to which rights and interests in real estate are owned. A system of modifiers has evolved that describes the nature or collection of rights and interst being described as part of a transaction. Fee simple: most complete form of ownership. Leasehold estate: rights and interests obtained by tenants when leasing or renting a property. TWO GENERAL CLASSIFICATIONS OF USE Based on rights : estates in possession versus estates not in possession(future possession)…Two broad categories on basis of nature of rights accompanying the ownership of such estates. Estate in possession(present estate in land) entitles its owner to immediate enjoyment of the rights to that estate. Estate not in possession(future estate in land): does not convey the rights of the estate until some time in
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This note was uploaded on 02/25/2012 for the course BIO 2400 taught by Professor Mclean during the Fall '09 term at Texas State.

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3321chapter 1 - Chapter 1: Introduction to Real Estate...

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