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Real Estate Vocabulary (43 - 48) | Real Estate License - YouTube
Channel: The Real Estate Classroom
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in today's real estate exam prep video
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we're going to continue
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our series on key important real estate
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terms that you have to know for your
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real estate exam and we're going to do
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numbers 43 through 48
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of 300 and we're starting right now
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hey everyone my name is paul vachesky
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and welcome to the real estate classroom
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youtube channel where our mission is
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simple and that's to help you pass your
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real estate exam the first time
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and a key way to do that is to know
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understand and know how to apply
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key real estate vocabulary terms it's
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really all about the terms and the
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and the phrases here okay and we're
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going to do 43 through 48 in this video
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and these particular terms
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evolve around the rights of the
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government
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and the rights that they have over an
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individual's
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real property this is so important to
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understand
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in 1776 july 5th 1776 we threw the
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british out of the colonies
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we implemented the lloydl system of
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property ownership which meant that you
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have the bundle of rights you had
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you own your piece of property in fact
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on july 5th 1776 you could shoot and
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kill somebody that was trespassing on
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your property
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and you could do it legally now since
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july 5th 1776
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to present there's been a lot of
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restrictions
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placed on individual owners property
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rights we still have the bundle of
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rights but there
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is an asterisk meaning there are
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restrictions to how far those rights
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go and there are uh the ones we're going
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to discuss today the key words we're
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going to
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discuss today evolve around those
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exceptions and those restrictions and
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the first one is number 43 of 300.
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it's called the ad of valorum tax
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ad valorem tax literally means in latin
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according to value
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this is where the government has the
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right to place
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property tax property tax levies against
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your real property
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and if you don't pay those taxes then
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you lose your ownership to that property
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they will
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foreclose on the property or sell it off
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at a tax auction or however the
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jurisdiction does that
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ad valorem tax is property taxes levied
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levied on real estate
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okay one of the methods that they do
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that is called the mill levy system
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which is number 44 of 300. it is a
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tax rate system and it's applied to the
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assessed value of the property so your
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assessed value the property is
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x the the jurisdiction is going to tax
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you at a certain percentage or a certain
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rate
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of that assessed value if you want if
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you want to know how this
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actually works structurally i already
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did a video on a couple of the
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different methods of assessing property
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property taxes against real property i'm
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going to leave a link right up here in
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the upper right hand corner if you want
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to check that out
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i think it's a great video to illustrate
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what i'm talking about here
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now one mill is equal to
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one dollar per thousand dollars of
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assessed
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value in numeric terms that's displayed
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as
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decimal 0 0 1 and again check out the
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video
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the link that i have up here in the
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right hand corner of your screen it'll
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show you how to use the mill levy system
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to calculate property taxes
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now number 45 of 300 is a special
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assessment a special assessment is a
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lien that is placed against the property
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to pay for
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improvements such as sidewalks streets
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sewers
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street lights those type of things now
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let me give you a couple of common
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examples of where we see special
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assessments
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so let's say a subdivider is uh a
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developer is going in and creating a
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subdivision a brand new
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subdivision with 500 lots where there's
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going to be 500 new homes
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so the city is going to come in and
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they're going to
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you know they're going to put in or
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install the streets the street lights
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the sewer lines etc the city is paying
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for it but the city is going to get
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reimbursed
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so what's going to happen is there's
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going to be a special assessment that's
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levied against each one of those 500
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lots and that new subdivision and as
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those lots are sold off
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then the owner is going to have to pay
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that special assessment to reimburse the
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city
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or that local government jurisdiction
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that paid for
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the streets to be put in uh they're
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reimbursing that's the method of
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reimbursement
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in the private sector we we also see
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this where maybe a developer pays for
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all of those
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streets and sidewalks and and so on and
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so forth and then they will put a
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special assessment lean against the
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property so when it's sold off they get
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reimbursed
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okay another common way that i see
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special assessments used by local
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governments
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give you an example here in omaha
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nebraska where i live
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we have many substandard streets so many
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of the streets that
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that are in omaha are not up to code
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and so let's say that there's a one
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block area
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that needs to be brought up to standard
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so the city of omaha is going to go in
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and they're going to pay for pavement or
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or repaving it putting in sidewalks
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whatever the case may be
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let's say there is 20 homes that border
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that street
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that was upgraded the city is going to
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go in and place
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a five thousand dollar special
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assessment against each one of those
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twenty homes that live along that or
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border that street that was put in
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the property owner is either gonna have
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to pay that five thousand dollars or
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when that property is sold then that
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lien needs to be
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paid and the city of omaha gets
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reimbursed for the cost of putting in
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that street those are the two most
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common
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ways that i see special assessments used
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there are other ways but those are the
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two most common
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number 46 of 300 is eminent domain now
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eminent domain is a legal right of the
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government to take an individual
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person's real property now when they
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take
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that real property it has to be for the
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general welfare
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safety and benefit of the general public
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for example the federal government might
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take people someone's property for a
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military base or to build an interstate
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the the state may come in and take
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someone's property to have a state park
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local governments such as the such as
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the school districts
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they may go and take someone's real
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property to build a new school or the
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city may
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do it to enhance or improve
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economic basis the economic basis of of
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the local community those are all
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examples of eminent domain and why
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eminent domain
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is used now there's a couple of things
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you have to remember with eminent domain
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number one the property owner has a
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right
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to their day in court they have a right
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to due process
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and what they're going to do is
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challenge that that governmental
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entity's reason for needing their
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property and
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quite frankly the property owner's
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almost
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always going to lose typically where i
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see the challenge is
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in the market value because compensation
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is a key
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component to eminent domain the school
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district has to give that property owner
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fair market value the federal government
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has to pay that that
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you know the property owner fair market
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value
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that is almost always the basis of any
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lawsuit challenging eminent domain it's
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about the money
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not so much the government's right to
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come in and take the property
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so a couple of things remember number
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one the property owner has a right to
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due process they have
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a title passes title will pass from the
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private owner to the government
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and then compensation under the under
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the constitution
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the government must pay you fair market
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value
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or fair compensation for the value of
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that land
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now number 47 of 300 is a doctrine
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called as cheat
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there's a root word in a sheet and it's
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called cheat
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c-h-e-a-t where the government is going
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to cheat someone
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out of their property now there are two
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ways that this sheet is used
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the first one is where someone dies
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intestate now intestate is a key real
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estate term that you have to know
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and it means that someone has died
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without a will and when somebody dies
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without a will
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they're not giving their property to
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somebody the second part is they died
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without a will
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and there's no heirs so this person that
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died
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they have there's no one to give this
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property to there's no one to give this
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deceased person's estate to so it's a
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legal mechanism for
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the government to come in and tie up
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that decedent's
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estate now is it the local government
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such as the county the city the state
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that's all going to be determined by
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state statute
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in that particular state that you're
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living but the key to remember under a
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street is
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title to the property passes to the
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government and then it's going to be
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liquidated
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their stocks their bonds their portfolio
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is all going to be liquidated
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and then under according to state
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statute it will be
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uh dispensed with in whatever way the
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statute
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uh calls for now the second way that we
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used
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a sheet is where we have an abandoned
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piece of property so maybe there is a
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property on 10th and main street
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the the owner has a ban in it maybe the
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owner lives in a different state
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it is now a crack house that's being
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used for prostitution it's a public
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nuisance to the local area
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it's a mechanism for the the local
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government to come in and dispense
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with that nuisance now under a street
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whether it's you know the person's
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estate reverting to the sovereign
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because they died intestate or because
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it's an abandonment situation in both
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cases
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title passes to the government and no
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compensation
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is provided in any way now one thing i
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want you to remember whether it's
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eminent domain
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or under a sheet there's a key real
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estate term that i do not have on the
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powerpoint but i'm going to put on your
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screen because you have to know it
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and under eminent domain and a sheet the
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government is going to use a
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legal process to obtain title to the
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property known as the condemnation
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process they're going to
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actually condemn the property and that's
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the legal process that you're
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they're going to use to obtain title
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under a sheet and eminent domain
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number 48 of 300 is police powers police
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powers
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is the powers bestowed to a government
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body whether it's local state or federal
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and it's a way for the government to
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impose rules and restrictions on the
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property that you
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own and again those rules and
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restrictions have to benefit the general
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public
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when we think of when we think of this
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we think of things like
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building codes zoning laws environmental
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laws those are all
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examples of where a government entity
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has placed restrictions on someone's
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private property and and it's important
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to remember that title does not pass
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under police powers and no compensation
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is given to the property owner
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you got to comply with the zoning laws
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you have to
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comply with local building codes
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otherwise
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there's punitive measures available to
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the government to impose upon you but
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again no compensation title doesn't
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pass and examples of police powers again
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as building codes environmental laws
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zoning laws etc
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if you want to continue studying
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vocabulary words check out this video
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right here
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comments and questions down below and
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don't forget if you have not subscribed
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click the little circle to my left i
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would appreciate it that's it see in the
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