Chapter 8 - Title Records Flashcards
RECORDING is the act of placing documents in…
The public record. In most states, written documents that affect land MUS BE RECORDED IN THE COUNTY WHERE THE LAND IS LOCATED.
Recording acts also generally give legal priority to those interests recorded first - the FIRST IN TIME, FIRST IN RIGHT or FIRST COME, FIRST SERVED principle.
Exceptions: lien for property taxes, special assessments and delinquent amounts owed to the IRS.
The _________ ___ _____ is the record of a property’s ownership. Beginning with the earliest owner, a title may pass to many individuals.
CHAIN OF TITLE
Because the grantee of the first deed to the property will become the grantor of the next transfer of title, each owner is LINKED to the next so that a CHAIN is formed.
If ownership cannot be traced through an unbroken chain of title, a GAP in the chain of title or______ ___ ___ ___ is said to exist.
CLOUD ON THE TITLE.
In such a case, it is necessary to establish ownership by a court action called an ACTION TO QUIET TITLE.
A TITLE SEARCH is?
An examination of the public records to determine whether any defects exist in the chain of title.
A full summary report of what the title search found in the public records is called a?
ABSTRACT OF TITLE.
The abstractor searches all the public records and then summarizes the various events and proceedings that affected the title throughout it’s history.
Under the terms of a typical real estate contract, the seller is required to deliver to the buyer a ________Title?
MARKETABLE TITLE to the property - that is, good or clear title, reasonably free from the risk of litigation over possible defects.
Questions of marketable title MUST BE RAISED by a buyer BEFORE ACCEPTANCE OF THE DEED. (the reason you do the title search)
A CERTIFICATE OF TITLE is…?
A statement of opinion of the titles status on the date the certificate is issued. A CERTIFICATE OF TITLE IS NOT A GUARANTEE OF OWNERSHIP. Rather, it certifies the condition of the title based on a an examination of the public records - a title search.
An opinion of the status of the title based on a review of the abstract or the_____ ____ __ ____ are used in some areas as EVIDENCE OF TITLE.
ATTORNEY’S OPINION OF TITLE
Similar to a certificate of title, the opinion of title does not protect against defects that cannot be discovered from the public records. MANY BUYERS PURCHASE TITLE INSURANCE TO DEFEND THE TITLE FROM THESE DEFECTS.
TITLE INSURANCE is a contract under which the policyholder is protected from losses arising….
from defects in the title.
UNLIKE other insurance policies that insure against FUTURE LOSSES, title insurance protects the insured form an event that occurred BEFORE the policy was issued. Title insurance is considered the best defense of title.
STANDARD TITLE INSURANCE covers against such hidden defects as…
Defects found in public records
Forged documents
Conveyances or transfers by INCOMPETENT GRANTORS, Incorrect marital statements
and IMPROPERLY DELIVERED DEEDS.
EXTENDED coverage includes standard plus
Property inspection, including unrecorded rights of persons in possession, examination of survey & Unrecorded liens not known by policyholder.
An OWNERS POLICY (title insurance policy) is issued for the benefit of the
OWNER (NEW BUYER) and the owner’s heirs or devisees and is issued for the property’s purchase price.
The LENDERS POLICY (mortgagee policy) is issued for the benefit of the
MORTGAGE LENDER and the amount of the mortgage loan will determine the amount of the coverage.
A deed by itself is not considered sufficient evidence of ownership. What certificates are commonly used to prove ownership?
CERTIFICATE OF TITLE, TITLE INSURANCE, OR A TORRENS CERTIFICATE
An ATTORNY’S OPINION & ABSTRACT of title
