Chapter 7 Flashcards
Tax Deed
The deed given to a purchaser at a public sale of land held for nonpayment of taxes. It conveys to the purchaser only such title as the defaulting taxpayer had.
Tax Sale
Sale of property after a period of nonpayment of taxes.
Actual Notice
Express or implied knowledge of a fact
Constructive Notice
A fact, imputed to a person by law, which should have been discovered because of the person’s actual notice of circumstances and the inquiry that a prudent person wold have been expected to make.
Promissory Note
A written promise to pay a debt as set forth in the writing Also known as a “Note”
Mortgage
An instrument by which a property is hypothecated to secure the payment of a debt
Mortgagor
The borrower in a mortgage loan who executes and delivers a mortgage to the lender
Judicial Foreclosure
A court proceeding requiring that property be sold to satisfy a mortgage lien
What are the three Parties in a Deed of Trust
Trustee
Beneficiary
Trustor
If the borrower does not pay
The lender can foreclose on the property without going through the courts. This is down as a Non-Judicial Foreclosure
Non-Judicial Foreclosure
favors the lender and offers the following advantages:
Less Costly
Quicker Process
Insurance
A contract between the insurer and the insured
Title Insurance
Insurance to protect a real property owner or lender up to a specified amount against certain types of loss (ex: defective or unmarketable title)
Escrow
The deposit of instruments and/or funds with instructions with a third neutral party to carry out the provisions of an agreement or contract.
Bankruptcy
A legal proceeding by an individual or company who are no longer able to pay their respective debts
Probate
The official proving of a will. The legal process wherein the estate of a dependent is administered.
Contract
An agreement to do or not to do a certain thing. It must have four essential elements: parties capable of contracting, consent of the parties, a lawful object, and consideration. A contract for sale of real property must also be in writing and signed by the party or parties to be charged with performance.
Express Contract
A contract that has been put into words, either spoke or written.
Implied Contract
An agreement that has not been put into words, but is implied by the actions of the parties
Bilateral Contract
A contract in which each party promises to do something
Unilateral Contract
When on party promises to do something if the other party performs a certain act, but the other party does not perms to perform itL the contact is formed only if the other party does perform the requested act.
Voidable
That which is capable of being adjudged void, but is not void unless action is taken to make it so.
Valid Contact
A contact that is legally binding and enforceable
Example: Any contact that includes ALL too the essential elements of a valid contact. This includes: Purchase Contact Listing Contract Independent Contractor Agreement
Void Contract
A contact that has no legal force or effect
Example:
Any contact that is missing One or More of the essential elements of a valid contract.
A contract is void if it is missing ANY of the following:
Lawful Objective
Consideration
Offer and Acceptance
Legally Capable Parties
Voidable Contract
A contact that may be voided by the parties without legal consequences.
Example:
A typical valid sales contact can become voidable if it includes contingency. A contingency can include:
Mortgage contingency (the buyer must obtain a mortgage in order to close on the transaction)
Inspection Contingency (the buyer may back out of the contract if they find significant defects during the property inspection.)
Property Sale Contingency (the buyer cannot close on the transaction until they sell their existing property.)
Enforceable Contract
A contract in which the parties may be legally required to perform
Example:
Any valid contact that offers a legal remedy in the event that the contact is not fulfilled, such as a typical purchase contract.
Unenforceable Contract
A contract that appears to meet the requirements for validity but would not be enforceable in court
Example
An oral contact used to purchase a property is unenforceable since the Stature of Frauds requires all real estate purchase contracts to be in writing
Consideration
Anything given or promised by a party to induce another to enter into a contract, ex:personal services or even love and affection. It may be benefit conferred upon one party or a detriment suffered by the other.
