Chapter 3D Legal Issues: Title and Closing Costs Flashcards
Title - Legal term for a bundle of rights in a piece of property in which a party may own either a legal interest or equitable interest.
Legal term for a bundle of rights in a piece of property in which a party may own either a legal interest or equitable interest.
Marketable Title
A title that a court of equity considers to be so free from defect that it will legally force its acceptance by a buyer.
Title Search
An examination of the public records to determine the ownership and encumbrances affecting real property.
Chain of Title
The sequence of historical transfers of title to a property. It runs from the present owner back to the original owner of the property.
Abstract of Title
A summary of all of the recorded instruments and proceedings which the title to property, arranged in the order in which they were recorded.
Title Insurance
A policy of insurance which indemnifies the holder for any loss sustained by reason defects in the title.
Closing Statement
A document commonly used in real estate transactions, detailing the fees, commissions, insurance, etc. that must be transacted for a successful transfer of ownership to take place.
Credits
A bookkeeping entry on the right side of an account, recording the reduction or elimination of an asset or an expense, or the creation of or addition to a liability or item of equity or revenue.
Debits
The amount charged as due or owing. That which is due from one person to another.
Proration
Adjustments of interest, taxes, and insurance, etc., on a pro rata basis as of the closing or agreed upon date. Allocation of closing costs and credits to buyers and sellers.
Constructive Notice
Information or knowledge of a fact imputed by law to a person because the person could have discovered the fact by proper diligence and inquiry.
Actual Notice
Notice delivered in such a way as to give legally sufficient assurance that actual knowledge of the matter has been conveyed to the recipient.
