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real estate > Unit 6: Transfer + Recording of Title > Flashcards

Unit 6: Transfer + Recording of Title Flashcards

1
Q

What is title insurance?

A

Protects buyers and lenders against financial loss. Provides clear and marketable title

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2
Q

What is the lender’s policy?

A

Offers protection worth amount of mortgage loan balance

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3
Q

What happens in the event of a claim?

A

Title company will pay debt, or take claimant to court. If title company pays debt, it’ll seek reimbursement from who caused loss

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4
Q

What does a title insurance policy exception include?

A

Claims made by person leasing property, mechanic/other liens filed after policy issued, disclosed + undisclosed easement and right of way, taxes, and special assessments

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5
Q

What does a title insurance company do?

A

Perform public record search in attempt to discover potential claims against property

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6
Q

What is a title abstract (abstract of title)?

A

Summary of property’s title history. Attorney and title companies who prepare abstract use public records to identify title history

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7
Q

What is the chain of title?

A

Establishes path of property ownership from first to current owner

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8
Q

What is a cloud of title?

A

Any encumbrance that prevents seller from a clear and marketable title

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9
Q

How can a foreclosure/inheritance claim be solved?

A

Having owner sign quitclaim deed, which release any claim they have on property

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10
Q

How can a cloud be resolved?

A

Through quiet title suit, owner goes to court to remove claims on property

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11
Q

What are the 5 common title issues?

A

Errors in public records, missing heirs, forgeries, unknown liens, survey/boundary issues, conflicting wills

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12
Q

When should a licensee encourage a buyer to opt for owner’s extended title coverage for all distressed property sales?

A

Properties may not be in ideal conditions, unpaid taxes, liens/encumbrance require resolution, more complicated transaction paperwork, need for additional experts ($$), individual state redemption process permit previous owners to take property back, closing can be lengthy

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13
Q

Title issues with REO:

A

Reverts to lender due to foreclosed sale, may be subject to buyer’s right of redemption, title issues are less common, closing may be lengthy

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14
Q

What is a deed?

A

Written and signed legal instrument of conveyance. Establishes proof of ownership and document that legally transfers (convey) title to real property

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15
Q

What is voluntary alienation?

A

When property is willingly sold or conveyed

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16
Q

What is involuntary alienation?

A

When property is seized by court order or foreclosure

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17
Q

What are the essential elements of a deed?

A

Is specifically named and identified, includes grantee name, act of conveyance, named consideration, legal description, any limitation/subject to clauses, Habendum clause, and grantor signature

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18
Q

What does the act of conveyance start with?

A

” does hereby bargain, grant, deed, and convey”

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19
Q

What does named consideration start with?

A

“for one dollar” or “for good and valuable consideration”

20
Q

What is Habendum clause?

A

Defines type of interest and rights grantee will have

21
Q

What is the process of ownership transfer?

A

Ownership transfer after grantor (seller) signs deed, and has been acknowledged. Grantor delivers deed to buyer, and they must accept

22
Q

What are the common deed types?

A

General warranty, special warranty and quitclaim deeds

23
Q

what is a general warranty?

A

Called full covenant and warranty deed; offers greatest warranty to buyers

24
Q

What are the general warranty’s 6 covenants?

A

Covenant of seisin, right to convey, against encumbrance, quiet enjoyment, further assurance, and warranty

25
Q

What is covenant of seisin?

A

Grantor holds title to property

26
Q

What is covenant of right to convey?

A

Grantor has legal capacity to convey title and has legal title to property

27
Q

What is covenant against encumbrance?

A

The grantor assures the grantee that no encumbrance exist other than identified in public records or deed itself

28
Q

What is covenant of quiet enjoyment?

A

Grantor assures that grantee’s use and enjoyment of property won’t be burdened because of a title defect

29
Q

What is covenant of further assurance?

A

Grantor’s promises to provide any additional assurances that grantee reasonably requires and will correct any title defect

30
Q

What is covenant of warranty?

A

Most important covenant, grantor agrees to warrant and defend title against lawful claims of others

31
Q

What is a special warranty deed?

A

Also called bargain and sale deed, typically warrants only against title defects acquired during grantor’s ownership

32
Q

Deeds of gifts and dedication:

A

Property owners can choose to voluntarily convey property by deed of gift + dedication; recipient cannot enforce warranties against grantor + owner donations property for common use

33
Q

What does interstate mean?

A

people who die without a will

34
Q

Who is the appointed executor?

A

Carries out will provisions when individual dies testate

35
Q

What does testate mean?

A

When a person dies with a will

36
Q

What is a devise?

A

Gift of real property

37
Q

What is devisor?

A

Person who writes the will

38
Q

What is the devisee?

A

A recipient

39
Q

What is a bequest/legacy?

A

Gift of personal property

40
Q

What is a legatee?

A

The recipient

41
Q

What are the 3 common will type?

A

Statutory, holographic and oral

42
Q

What is statutory will?

A

Used for straightforward situations; may be checkboxes/fill in blank

43
Q

What are holographic wills?

A

handwritten and unwitnessed, may/may not be recognized as a legal will

44
Q

What are oral will?

A

Provisions are spoken to witnesses; may only be used under certain circumstances/may or not be recognized as legal will

45
Q

What is ad valorem?

A

Based on property assessed value

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