Chapter 5 Areas of Concern

Question 1

Differentiate between voluntary and involuntary alienation

Answer 1

A voluntary lien is given out of choice. An involuntary lien is recorded for the non-payment of a debt.

Question 2

Explain the various methods of acquiring title to real property and describe the conditions necessary to acquire real property by adverse possession

Answer 2

There are six methods of acquiring title to real property:

1. Deed: The most common means of conveying title
2. Will: A person leaves their estate to others upon their death
3. Descent and distribution: Transfers a person’s estate when there is no will.
4. Escheat: Title conveys to Florida when a person dies without a will and wIth no heirs
5. Eminent domain: Government seizing privately owned property for public use
6. Adverse possession: Open and hostile possession doing the normal things a true property owner would do for seven or more years.

Question 3

Distinguish between actual notice and constructive notice

Answer 3

Actual notice is physically reading a person’s deed, being told by the owner that they have acquired title, or by observing a person’s actual possession and control of a property and inferring some interest in the property. Constructive notice, also known as legal notice, is created by recording in the public records any interest in real estate that might be owned.

Question 4

Distinguish between an abstract of title and a chain of title

Answer 4

A chain of title is a history of ownership. An abstract is a complete history of a property, which includes title, liens and any other document recorded.

Question 5

Explain the different types of title insurance

Answer 5

There are two types of title insurance. The owner’s policy covering the owner’s equity in a property while the lender’s policy (mortgagee’s policy) covers the banks investment in a property.

Question 6

Describe the parts of a deed and the requirements of a valid deed

Answer 6

The important parts of a deed are the names of the grantor and grantee, consideration, words of conveyance, estate being conveyed, restrictions and reservations, appurtenances, legal description, signature of the grantor with two witnesses, and the deed delivered and accepted.

Question 7

List and describe the four types of statutory deeds and the legal requirements for deeds

Answer 7

The four types of statutory deeds are quitclaim, bargain and sale, special warranty and general warranty deeds. In order for title to transfer the grantor must deliver the deed and the grantee must accept the deed.

Question 8

List and describe the various types of governmental and private restrictions on ownership of real property

Answer 8

There are two methods of restrictions on property:

1. Governmental restrictions include police powers, eminent domain and taxes
2. Private limitations include deed restrictions, easements, leases and liens.

Question 9

Distinguish among the various types of leases

Answer 9

There are five types of leases:

1. Gross Lease
2. Net Lease
3. Percentage Lease
4. Variable Lease
5. Ground Lease

Question 10

What two ways can a licensee transfer its rights to a lease?

Answer 10

1. An assignment of lease gives up everything owned remaining in a lease.
2. A sublease gives up less than everything owned in a lease.