Proven mnemonics — built specifically for the real estate licensing exam.
DUST
DUST: Dwelling, Unit, Structure, Tract — 4 types of real property
DUST
The four types of real property tested on every licensing exam
Dwelling: a place to live (house, condo). Unit: an apartment or condo unit. Structure: a building or improvement. Tract: a parcel of raw land. Real property = land plus anything permanently attached to it.
D
Dwelling — residential property
U
Unit — apartment or condo
S
Structure — building or improvement
T
Tract — parcel of land
Personal vs Real Property
PETE: Personal property, Everything movable, Temporary, Easy to take — vs real property
Personal vs Real Property
The most fundamental distinction in real estate
Real property: land and everything permanently attached (buildings, fixtures, trees). Personal property (chattel): movable items not permanently attached. The test: is it a fixture? MARIA — Method of attachment, Adaptability, Relationship of parties, Intention, Agreement.
Grant Deed vs Quitclaim Deed
Deed types: GRANT gives ownership. QUITCLAIM gives whatever the grantor has (maybe nothing).
Grant Deed vs Quitclaim Deed
Two most common deed types — and the protection each provides
Grant deed: grantor guarantees they own the property and haven't sold it to anyone else. Implied warranties of title. Quitclaim deed: grantor transfers whatever interest they have — could be full ownership or nothing. No warranties. Used to clear title defects, between family members, in divorce.
Types of Encumbrances
Encumbrance = anything that limits title. FELT: Financial, Easements, Liens, Title restrictions
Types of Encumbrances
Four categories of encumbrances that cloud or limit title
Financial encumbrances: mortgages, deeds of trust, judgments. Easements: right of others to use the property. Liens: financial claims against the property (tax lien, mechanic's lien). Title restrictions: CC&Rs, deed restrictions, zoning.
F
Financial — mortgages, judgments
E
Easements — right to use
L
Liens — financial claims
T
Title restrictions — CC&Rs, zoning
Easement Types
Easement types: Appurtenant (benefits neighboring land) vs In Gross (benefits a person or company)
Easement Types
Two categories of easements — who benefits tells you the type
Easement appurtenant: attached to the land, transfers with the property. Dominant tenement (benefits) and servient tenement (burdened). Example: right-of-way across a neighbor's land. Easement in gross: personal right, not attached to land. Utility company right-of-way, billboard rights.
Lien Priority
Lien priority: TAX liens first, then recorded order — 'First in time, first in right'
Lien Priority
Which liens get paid first when a property is sold or foreclosed
General rule: liens are paid in order of recording date. EXCEPTIONS: Property tax liens always have first priority regardless of recording date. Special assessment liens (street improvements) also super-priority. Then recorded mortgages in order. Mechanic's liens may relate back to start of construction.
Title Insurance
Title insurance: Owner's policy protects buyer. Lender's policy protects the lender. Both common at closing.
Title Insurance
Two types of title insurance — who each protects
Lender's (mortgagee) policy: required by almost all lenders, protects lender's interest up to loan amount. Owner's policy: optional but strongly recommended, protects buyer's full equity. Both protect against defects in title that existed BEFORE the policy date — not future events.
Escrow
Escrow: neutral third party holds funds and documents until all conditions are met
Escrow
The closing mechanism that protects both buyer and seller
Escrow agent (title company, attorney, or escrow company depending on state) holds: earnest money deposit, loan documents, deed, closing funds. Releases everything simultaneously when all conditions met. Protects both parties — seller knows funds are secured, buyer knows deed won't transfer until paid.
Water Rights
Riparian rights: water rights for land bordering rivers/streams. Littoral: bordering lakes/oceans.
Water Rights
Two types of water rights based on the type of water body
Riparian rights (rivers and streams): landowner has the right to use water flowing past their land but cannot unreasonably diminish flow for downstream users. Littoral rights (lakes and oceans): landowner owns to the high-water mark. Prior appropriation states: water rights based on 'first in time, first in right.'
How a trespasser can legally acquire title to land
A person can gain title to land by occupying it openly and continuously for the statutory period (varies by state, typically 5-21 years). OCEAN: Open (visible, not hidden), Continuous (uninterrupted), Exclusive (not shared with owner), Actual (physical use), Notorious/Hostile (without owner's permission).
O
Open — visible occupation
C
Continuous — uninterrupted
E
Exclusive — not shared with owner
A
Actual — physical use
N
Notorious/Hostile — without permission
Eminent Domain
Eminent domain: government takes private property for public use — must pay just compensation
Eminent Domain
The government's power to take private property
5th Amendment: government can take private property for public use but must pay 'just compensation' (fair market value). Condemnation: the legal process. Inverse condemnation: when government action damages property without formal taking. Escheat: property reverts to state when owner dies with no heirs.
Zoning Categories
Zoning types: R (residential), C (commercial), I (industrial), A (agricultural)
Zoning Categories
The four basic zoning classifications
Residential (R): housing — single family (R-1), multi-family (R-2, R-3). Commercial (C): retail, offices, restaurants. Industrial (I): manufacturing, warehouses. Agricultural (A): farming, ranching. Variance: exception to zoning rules. Non-conforming use: legal use that predates the zoning change.