Chapter 17 - Real Estate Closings

Question 1

Abstract of Title

Answer 1

A brief, chronological summary of recorded documents affecting title to a particular parcel of real property

Question 2

Bargain and sale deed

Answer 2

imply the grantor owns the property and has a right to convey it, but there are no warranties that go with it

Question 3

Chain of title

Answer 3

Chain of deeds and other documents transferring title to land from one owner to the next, as disclosed in public records

Question 4

Cloud on the title

Answer 4

A claim, encumbrance, or defect that make title to real property unmarketable

Question 5

contructive/actual notice

Answer 5

Constructive Notice - Provides protection to a landowner againts all unrecorded titles. Actual Notice - Actual knowledge; that which is known

Question 6

credits/debits

Answer 6

Credits - Money received for an obligation given. Debits - An expense or money applied against a credit

Question 7

deed

Answer 7

The legal document conveying title to a property

Question 8

Descent

Answer 8

An operation of law when a real property is transferred to an heir aafter the deaath of the owner who leaves no will (intestate)

Question 9

Device

Answer 9

The transfer of real property through a will

Question 10

Escrow Closing

Answer 10

closing by a disinterested third party, often an escrow agent

Question 11

General Warranty Deed

Answer 11

deeds in which a grantor warrants title against defects that may have arisen before or during the grantor’s ownership

Question 12

Grantor/Grantee

Answer 12

Grantor - the person who transfers title to real property in a real estate transaction. Grantee - the person who receives a conveyance of real property in a real estate transaction

Question 13

Habendum Clause

Answer 13

Clause within a deed that describes the type of estate granted; it must always agree with the granting clause

Question 14

HUD -1 settlement statement

Answer 14

An accurate accounting of all expenses buyers and sellers pay in real estate transaction; required by RESPA

Question 15

Intestate/Testate

Answer 15

Intestate - the act of dying without a legal will. Testate - The act of dying with a legal will

Question 16

Involuntary/voluntary alienation

Answer 16

involuntary alienation - when title to property is transferred during the owner’s lifetime without his concent. Voluntary - When title to property is transferred voluntarily through a sale, gift, dedication or grant

Question 17

Limited warranty deed

Answer 17

Deeds in which the grantor warrants the title only against defects arising during the time that he owned the property and not against defects arising before that time

Question 18

Marketable Title

Answer 18

Title that is free and clear of objectionable encumbrances or defects so that a reasonably prudent person with full knowledge of the facts would not hesitate to purchase the property

Question 19

Proration

Answer 19

The division of expenses between buyer and seller in proportion to the actual usage of the item represented by a particular expense.

Question 20

Quitclaim Deed

Answer 20

Convey any interest in real property the grantor has at the time the deed is executed

Question 21

Real Estate Settlement Procedures ACT (RESPA)

Answer 21

Requires lenders, mortgage brokers, or servicers of home loans to provide borrowers with pertinent and timely disclosure of the nature and costs of the real estate settlement process

Question 22

Reconciliation

Answer 22

1. The appraisal process of analyzing the values derived from the different appraisal approaches to arrive at a final value estimate or opinions. 2. Verifying the debits and credits have been added and subtracted correctly on a real estate settlement statement

Question 23

Sheriff’s Deed

Answer 23

Used in sheriff’s sale at foreclosure

Question 24

Survey

Answer 24

The process of precisely measuring the boundaries and determining the area of a parcel of land

Question 25

Title

Answer 25

Lawful ownership of real property. Also in informal usage the deed or other document that is evidence of ownership

Question 26

Title Insurance

Answer 26

insurance that indemnifies against losses resulting from undiscovered title defects and encumbrances

Question 27

Title Search

Answer 27

a check of the title records to ensure that the seller is the legal owner of the property and that there are no liens or other claims outstanding

Question 28

Words of Conveyance

Answer 28

deed language that clearly states the grantor’s intention to transfer the real property