Chapter 04: Transfer of Title to Real Property Flashcards
Title to real estate inherited from a person who died testate is referred to as a:
A. legacy
B. bequest
C. devise
D. descent
C. devise
(A person who dies with a will dies testate. The passing of the real property through a will is called a devise)
Title to real estate passes when a valid deed is:
A. signed and recorded
B. signed, delivered and accepted
C. filed and microfilmed
D. executed and mailed
B. signed, delivered and accepted
(Transfer of real estate occurs when the deed is signed by the grantor, delivered to the grantee and accepted. It is not necessary for a deed to be recorded in order to be valid. In NC the Conner Act requires deeds to be recorded only to give constructive notice and protect the owner from claims by third parties, not to make the transfer of the real estate valid between the grantor and the grantee)
Which of the following is an essential element of a valid North Carolina deed?
A. a seal
B. recordation
C. the signature of the grantee
D. words of conveyance
D. words of conveyance
(Deeds do not need to be sealed, notarized or recorded in order to be valid. They only need to be notarized in order to be recorded and they are only recorded to protect against outside third party claims. Only the grantor is required to sign a deed, not the grantee)
When the grantor does NOT wish to convey certain property rights:
A. exceptions must be noted in a separate document
B. the deed must convey the property with all rights intact
C. exceptions may be noted in the deed of conveyance
D. the grantor must convey the entire premises and have the grantee reconvey the rights to be retained by the grantor
C. exceptions may be noted in the deed of conveyance
(An owner may always reserve or except certain items from the transfer. They note these reservations or exceptions in the deed. A good example would be an owner transferring a parcel of real estate and excepting or reserving the mineral rights as noted in the deed of conveyance)
A trespasser built a log cabin in a remote area of a national park and occupied the structure for more than 25 years. That person will never be able to claim the property under adverse possession statutes because:
A. the possession was not notorious
B. the possession was not open
C. the property was not privately owned
D. the property was not properly fenced
C. the property was not privately owned
(Adverse possession is the taking of private property from a private owner. A person cannot claim adverse possession of government owned land such as a national park. In order to claim adverse possession the use must be open, continuous, exclusive, adverse and notorious. In NC the period of exclusive use in order to claim adverse possession is 20 years)
The seller conveyed a quitclaim deed to the buyer. Upon receipt of the deed, the buyer may be certain that:
A. the seller owned the property
B. there are no encumbrances against the property
C. the buyer now owns the property subject to certain claims of the seller
D. any and all of the seller’s interests in the property belong to the buyer
D. any and all of the seller’s interests in the property belong to the buyer
(A quit claim deed contains no warranties of ownership or encumbrances. A quit claim deed only terminates the rights or interests of a seller if the seller had those rights or interests in the property)
Which of the following statements about North Carolina deeds is correct?
A. A general warranty deed is the best way for the buyer to receive title.
B. A special warranty deed gives the seller the greatest degree of liability.
C. A bargain and sale deed is very much like the special warranty deed.
D. A gift deed must be recorded within 30 days to remain valid.
A. A general warranty deed is the best way for the buyer to receive title.
(The highest and best deed is a general warranty deed and it is typically used in residential sales transactions. It makes the most promises by the grantor, imposes upon the grantor the most liability and offers the grantee the greatest protection. The NC Offer to Purchase and Contract requires a seller to provide the buyer with a General Warranty Deed)
Which of the following is TRUE regarding a special warranty deed?
A. A grantor makes additional warranties beyond those given in a general warranty deed.
B. The grantor retains an ownership interest in the property.
C. The grantor is warranting that no undisclosed encumbrances exist against the property.
D. The grantor’s warranties are limited to the time the grantor owned the property.
D. The grantor’s warranties are limited to the time the grantor owned the property.
(A special warranty deed is limited. It only protects the grantee as to actions which occurred during the grantor’s term of ownership)
Regarding title recordation, which of the following statement(s) is/are true?
A. Physically taking possession of the property is constructive notice.
B. Public notice of recording documents is actual notice.
A. A only
B. B only
C. Both A and B
D. Neither A nor B
D. Neither A nor B
(Actual notice are those things that we see, witness or observe. Therefore physically taking possession would be actual notice. Recordation, the act of placing documents into a public database provides constructive notice)
Which of the following would be considered an essential element of a valid deed in North Carolina?
A. Acknowledgement
B. Witnessed
A. A only
B. B only
C. Both A and B
D. Neither A nor B
D. Neither A nor B
(Deeds neither have to be acknowledged (notarized) or witnessed to be valid. The will need to be acknowledged in order to be recorded. However, recordation is not required for a deed to be valid. Recordation is required under the Conner Act to provide constructive notice. While a deed may need to be notarized to be recorded. It does not have to be notarized to be valid)
All of the following may be discovered in a title search, EXCEPT:
A. the legal description of the property
B. liens and judgments
C. easements
D. encroachments
D. encroachments
(Encroachments which are physical items such as a building, tree or fence would not typically appear in the public records. These items would generally only be discovered by the parties obtaining a survey)
Which of the following is TRUE?
A. The grantor under a special warranty deed warrants that the grantee’s title will be defended and protected against any claims whatsoever.
B. The grantor under a general warranty deed promises that the grantee’s title will be defended and protected only against claims resulting from the grantor’s ownership.
C. The grantor under a quitclaim deed only conveys any interest the grantor may have in the property.
D. A minor will convey absolute ownership interest in a property as long as the signature is obtained in the presence of a parent.
C. The grantor under a quitclaim deed only conveys any interest the grantor may have in the property.
(A quitclaim deed states that the grantor is surrendering a right or interest in the property “if they have any.”)
The recording of a deed:
A. is required in order to fully transfer the title of the real estate
B. makes the deed enforceable
C. ensures the grantee’s interest in a parcel of real estate
D. warrants the grantee’s title to real property
B. makes the deed enforceable
(There is a difference between a deed being valid and enforceable. Recordation is not required to make a deed valid, it is required to make the deed enforceable against third party interests. The Conner Act requires recordation in order to provide constructive notice)
The recordation of a general warranty deed:
A. guarantees ownership
B. protects the interests of the grantee
C. prevents claims of parties in possession
D. provides defense against adverse possession
B. protects the interests of the grantee
(Recordation protects the interests of a grantee against third party claims)
Don, a real estate broker, has agreed to prepare a deed for the seller in a transaction in which he is the listing agent. If he does not charge the seller a separate fee for this service: .
A. He has done nothing illegal since he did not charge a separate fee for his service.
B. He may have his license suspended or revoked by the North Carolina Real Estate Commission.
C. He has not violated any rules or laws as long as he obtains consent from both parties prior to engaging in this act.
D. There is no violation as long as he has a broker’s license.
B. He may have his license suspended or revoked by the North Carolina Real Estate Commission.
(Real estate licensees do not prepare deeds. The drafting of deeds and other legal documents is considered the practice of law and should always be conducted by licensed attorneys)
