Brainscape's Knowledge GenomeTM

Browse over 1 million classes created by top students, professors, publishers, and experts.


See full index

Real Estate > Encumbrances And Title Insurance > Flashcards

Encumbrances And Title Insurance Flashcards

1
Q

Recordation/recording

A

Public filing of a document.

The first to record has priority, and has ownership of the property.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
2
Q

Constructive notice

A

A public recordation of an event, meeting notice was published, but not necessarily given directly to the affected parties, while still technically being available in the public record

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
3
Q

Actual notice

A

Express notice given directly to a person of actual knowledge that is known

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
4
Q

When does the title officially changed hands?

A

With the transfer of the deed from the seller to the buyer

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
5
Q

All closing documents are recorded
True or false

A

False
Only the documents that impact ownership interest need to be recorded

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
6
Q

Until a deed is recorded ownership can be legally challenged, true or false

A

True

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
7
Q

Recordation

A

Protects the owners title against all claims of interest, not recorded in any public record

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
8
Q

Recording requirements in California

A

Must be in writing
Must be executed a.k.a. signed
Must be a knowledge before a **notary public **
Must have the name and address of the requester

There may be specific size of paper type requirements as well

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
9
Q

Lien types

A
  1. Voluntary Lien - individual agrees to have security placed against himself or his property
  2. Involuntary lien - creditor places in claim on real or personal property to legal means without the owners consent in order to collect unpaid debt
  3. General lien - a claim against an individual and all their property
  4. Specifically - a lien against a single property
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
10
Q

Voluntary Lien specific

A

Mortgage lien

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
11
Q

Involuntary lien general

A
  • Estate and inheritance tax lien
  • Deceased persons debt
  • Income tax lien
  • Judgment lien
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
12
Q

Involuntary lien specific

A
  • Mechanics lien
  • Real property tax lien
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
13
Q

Mortgage lien

A

Specific and voluntary lien

Affects one particular property. Voluntary buyers purchase real property or via financing and agree to the mortgage lien.

The property itself is loan collateral, if buyer, defaults, lender may foreclose property proceeds go to paying off lien priority

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
14
Q

Estate and inheritance tax lien

A

General and involuntary lien

The estate is allowed to sell sufficient property for taxes on a lien if owner dies, possessions then property

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
15
Q

Deceased persons, descendants debts

A

general involuntary Real property passes to devicee named in the will, or intestate without a will, property passes to the heirs according to the states laws descendent distribution.

The a decedents debts are first paid out of any personal property, not specific. Real property must be sold to pay any remaining that devicees or heirs may take title to the property after all attached liens, encumbrances creditors, have been satisfied.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
16
Q

Federal and state tax lien

A

General and involuntary lien

Government may attach liens to real property when owners disobeying federal income tax, laws fail to pay gift, taxes, or when a property transfers ownership due to the owners death.

Example: Doesn’t pay income taxes government will file tax warrant in the county where the property is located

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
17
Q

Judgment lien

A

General and involuntary lien

When people win lawsuits over property owners, judgment means, ensure they get the money they won in the lawsuit

Creditors must record judgment with the county to create a lien on debtors property

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
18
Q

Lis pendens

A

A **legal notice **that a lawsuit is pending and send facts of title of the property. This serves as warning, a prospective buyers that a pending lawsuit could impact title.

  • If title transfers to someone else after lis penden has been filed the judgment will attach to the property.
  • lenders will usually file lis pendens when they begin foreclosure.
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
19
Q

Mechanics lien

A

Specific and involuntary lien

Protects anyone who furnishes, professionals and skilled services, labor, materials for real property, improvements, such as new construction and renovation.

This statutory lien recognizes that those who work in construction industry need a solid solution when their fees aren’t paid lien will show date work first began, placed higher, and priority to subsequently or encumbrances Either filed or on record it. “ materialmen’s liens”

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
20
Q

Real property tax lien

A

Specific and involuntary lien

Real property submit to government taxes to pay for government services and programs property taxes, in which the tax amount is based on properties, transaction value, or assessed on January 1 for the previous year. Lien is placed on property until owner pays the taxes.

If taxes are not paid, government come foreclose , the legal proceeding to do so it’s called “rem legal proceeding”

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
21
Q

A claim against an individual and all their property

A

General Lien

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
22
Q

A lien against a single property

A

Specific lien

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
23
Q

A general involuntary lien the IRS places against a property for dues and unpaid taxes

A

Income tax lien

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
24
Q

A general involuntary lien brought against the property due to a court decree resulting from a lawsuit

A

Judgment lien

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
25
Q

Is a mechanics lien voluntary or involuntary

A

Involuntary

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
26
Q

Is income tax lien, voluntary or involuntary?

A

Involuntary

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
27
Q

Is income tax lien a general lien?

A

Yes

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
28
Q

Is property tax a general lien

A

No

Specific to property

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
29
Q

What things can general liens take, claim, effect?

A

Boat, House, art, jewelry, land

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
30
Q

What is a type of lien as a result for not paying child support

A

Judgment lien

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
31
Q

What is Lis pendens

A

A legal notice that a lawsuit is pending that affects the title of the property

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
32
Q

General lien

A

A claim against a person and all of their property

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
33
Q

Judgment liens

A

A lien placed as a result of legal action or lawsuit, recorded in the county clerks office

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
34
Q

Estate and inheritance tax lien

A

A lien placed when a person dies in federal estate, taxes and state inheritance taxes must be paid, the descendants property may be sold to pay the lien

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
35
Q

Deceased persons debt

A
  • Taxes the heirs, other than those named in the will, who receive real property.

It will have to be paid out of the remaining or the state proceeds before the rest of the property can pass to them

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
36
Q

Income tax liens

A

A lien imposed for nonpayment of taxes, maybe for various taxes owed personal income tax, employee withholding, tax, etc.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
37
Q

The collection of the monies for unpaid property taxes is by a foreclosure sale of the property

True or false

A

False
The collection of monies are for unpaid property taxes is by a for sale of the property at a tax sale

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
38
Q

Which option describes a real property tax lien

A

Specific and involuntary

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
39
Q

What type of involuntary lien is placed on a persons estate after their death if there are unpaid debt to creditors?

Deceased persons debt lien
Estate/inheritance tax lien

A

Deceased persons, debt lien

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
40
Q

What defines an income tax lien

A

**Involuntary **lien placed against a property owners property for dues and unpaid taxes

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
41
Q

Which of the following is true about ownership or title to a property

A. constructive notice to public. A real property ownership occurs when the deed is recorded.
B. The last party to record has priority.
C. The seller is responsible for paying the owners and lenders title insurance.
D. Title isn’t finalized until the deed has been recorded.

A

Constructive notice to the public of real property ownership occurs when the deed is recorded

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
42
Q

Why is it important to publicly record a deed?

A. The title insurance policy scheduled exceptions will include anything that publicly recorded
B. Title insurance policies don’t cover publicly recorded events.
C. Title insurance policies must be publicly recorded to be legal.
D. Title representatives and attorneys who perform title searches look for documents that are publicly recorded.

A

D. Title representative and attorneys who perform title researches look for documents that are publicly recorded.

They look at the schedule of exemptions and will exclude items that are recorded

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
43
Q

In addition to being properly executed, signed, what are other requirements for recording a document in California?

A

Acknowledgment before a notary public

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
44
Q

Christina purchased a house from Thomas. When did she officially gain ownership of the property?

A

With the transfer of deed from the seller to the buyer

Don’t forget this

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
45
Q

Encumbrance

A

A burden or impediment

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
46
Q

Liens

A

Claims or charges against a property by someone other than the property owner

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
47
Q

Payment bond

A

Bonding company will compensate the home owner if the contractor defaults in performance, including non-payments of subcontractors

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
48
Q

Preliminary notice

A

Right to file a lien notice

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
49
Q

Mechanics preliminary bond

A

When payment bond is in place, bonding company will compensate the homeowner if the contract default in performance , including nonpayment of subcontractors

First come first serve, begins on the date. Materials are first delivered.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
50
Q

Preliminary notice requirements for a mechanics lien

A

File a lien- must be given to the homeowner within -20 days of commencement of work _

Lien claim must be pursued within 90 days of filing a lien claim

Even when extensions of credit are granted

Lien cannot be extended more than one year after the work is completed

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
51
Q

Homeowner can file a notice of completion with the county recorder when:

A
  • The work stops, and the homeowner uses completed work a.k.a. kitchen
  • The homeowner excepts the work as completed
  • Work has stopped for 60 days
  • The owner has filed a notice of cessation after work has stopped for 30 days

Notice of completion has to be filed within 10 days after work is completed
If such notice has been filed, contractor has 60 days to file a mechanics lien
Subcontractor material supplier, or other professional under mechanics, lien provision has 30 days to file

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
52
Q

Release of mechanics lien

A

Title insurance company won’t insure the property if there is a mechanic lien

claimant a record release of mechanic lien or petition the court to expunge the lien, homeowner would be entitled to attorney fees and costs

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
53
Q

Lien Release bond

A

When a contractor tries to foreclose on a property due to lien, the home, owner must protest mechanics lien and file a lien release bond in the county recorders office , where the lien was recorded.

The bond must be a %150 of the amount claimed the property that the owner is trying to release. Bond is designed to cover amount claimed by Contractor including legal fees.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
54
Q

Notice of non-responsibility

A

If a contractor tries to do work without contract and tries to place a lien. You should file a **notice of nonresponsibility.

  • I post conspicuously on the property itself
  • Record within 10 days of learning that the unauthorized work
  • Include a property description and the name, address and property, interest of the person giving the notice, and a brief statement, stating that the person providing the notice is not responsible for any claims arising from the work
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
55
Q

Mechanic’s lien timeline

A

Preliminary notice- within 20 days of the start date

Right to file a mechanics lien - within 90 days of end date up to one year

Notice of completion - within 10 days of end

Contractor has the right to file a mechanics lien - within 60 days of end date

All other subcontractors have right to file a mechanics lien - within 30 days of end date

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
56
Q

In California, mechanics liens, have priority over all other liens on the property
True or false

A

False
Well, there are strong rules in place to protect the rights to file a mechanic’s lien , other liens, such as property, tax lien, will take priority. Timing is also an issue.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
57
Q

Lien rights do not survive, foreclosure, or sale of property
True or false

A

False

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
58
Q

The contractor or subcontractor must file a preliminary notice with the owner

A

20 days of work starting

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
59
Q

Mechanics lien claimants must file the lien in court if the owner has not filed a notice of cessation or completion, what time frame?

A

Up to 90 days after work ends

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
60
Q

Contractors filing a mechanics lien, must file the lien in court if the owner has filed a notice of cessation or completion

A

Up to 60 days after work ends

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
61
Q

Subcontractors and material suppliers, filing a mechanics lien must file the lien if the owner has filed a notice of cessation or completion

A

Up to 30 days after work ends

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
62
Q

When is Mechanics lien is enforced?

A

90 days after filing lien

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
63
Q

A work contract doesn’t allow the contractor to claim a lien on the property
Allowed
Not allowed

A

Not allowed
In California, any contract that takes away the right to a mechanics lien is considered void and unforeseeable

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
64
Q

The property owner can require the contractor to obtain a payment bond
Allowed
Not allowed

A

Allowed

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
65
Q

The property owner can file a lien release bond if they want to dispute the lien and stop a foreclosure
Allowed
Not allowed

A

Allowed

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
66
Q

The property owner can post and file a notice of non-responsibility to stop any unauthorized work and claims from occurring
Allowed
Not allowed

A

Allowed

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
67
Q

A payment bond

A

Can be used to prevent subcontractors from making claims if the contractor was paid, but didn’t pay those the contractor hired, preventing the property owner from paying twice for the same work

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
68
Q

A lien release bond

A

Used to stop the foreclosure so that the owner can dispute the lien

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
69
Q

Statutory lien

A

Created by statute or law, a real estate, tax lien is an involuntary statutory lien created without any action required of the property owner

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
70
Q

Equitable liens

A

Created by a court of common law.

The lienholder has a equit(y)able lien on property. Equitable liens, do not give the right of possession, they are simply a charge or encumbrance on the property.

71
Q

Equitable lien

A

Involuntary lien general, equitable, Lien is placed as a result of a court order
A.k.a. judgment lien

72
Q

This type of lien is created by the statute or law

A

Statutory lean

73
Q

A real property tax lien is an example of involuntary version of this lien, created without any action required on the part of the property owner

A

Statutory lien

74
Q

This type of lien is created by a court or common law

A

Equitable lien

75
Q

This type of lean does not give the right of possession, it’s simply a change or encumbrance on the property

A

Equitable lien

76
Q

Amount owed by homeowner is an example of involuntary version of this type of lien on a home

A

Equitable lien

77
Q

Forclose

A

When real property is encumbered by a lien, the lender forecloses on the property & enforce a sale

78
Q

California foreclosure

A

California uses a non- judicial foreclosure process, which means there is no court involvement the property go through a trustee sale.

Beneficiary lender notifies trustee, a third-party that the trustors a.k.a. borrowers are default and instructs the trustee to begin foreclosure

The trustee files records, notice of default NOD WHICH NOTIFIES THE trustor AS WELL AS OTHERS who HAVE FILED A REQUEST OF NOTICE OF DEFAULT

TRUSTORS HAVE THREE MONTHS, NOT 90 DAYS, THE EXACT NUMBER TO REINSTATE THE LOAN BY PAYING ALL PAYMENTS

TRUSTEE FILES A NOTICE OF SALE NOS after 85 days have lapsed NOS must be 20 days from the end of the three month of NOD period.

The trustors may reinstate the loan by paying all amounts due including charges during the first 15 days of the NOS. During the final five days, the trust stores must pay the entire loan balance, referred to as redemption in order to keep the property.

The trustee conducts the sale of property no earlier than 21 days after the NOS is filed. ACL may be postponed for up to 365 days after which a new and OS will be filed providing for an additional 20 days for reinstatement and redemption as described above.

The beneficiary makes the first bed to the trustee, anyone me over bid the beneficiary

The highest bidder wins and is convey title to the property

The previous owner receives a written notice, providing them 30 days to leave the property if they fail eviction process will proceed

79
Q

A foreclosure sale is sold out in public auction to the highest bidder
True or false

A

True

80
Q

Foreclosed Owner can still claim title to the property after the trustee sale
True or false

A

False
the buyer legally takes ownership once the foreclosure takes place

81
Q

Foreclosure process is judicial
True or false?

A

False
In California foreclosures go through a non-judicial process

82
Q

In California foreclosures, go through a non-judicial process, known as a trustee’s sale
After that the lender notifies the trustee that the borrower is in default (step one). What are the steps that take place assuming the borrowers take no action to reinstate the loan?

A

Beneficiary Lender makes the first bid

Highest bidder wins the property

83
Q

Right of redemption with foreclosure, ceases, the right when the foreclosure sale is held
True or false

A

True

84
Q

The right of redemption before closure requires repayment of the entire debt owed to the lienholder
True or false

A

True

85
Q

Right of redemption foreclosure: Lender is not allowed to include costs associated with the foreclosure
True or false

A

False

86
Q

Homestead exemption

A

Homestead exemption is to protect homeowner equity (the total value of the property, minus the amount owed) from creditors, holding unsecured debt, the property and Owner must meet certain qualifications

Prohibits a forced sale - home owners equity is less than or equal to the amount owed on the mortgage loan plus the amount of the homestead exemption

Protects equity in the event of a sale - six-month rule that offers them some additional protection from creditors. If the homeowner has failed a declaration of homestead and invest the proceeds within six months at another Homestead.

Homeowner $75,000
Home owner plus spouse $100,000
Home owner +65 and older spouse $175,000
Home owner with physically mentally disabled spouse $175,000
Home owner a 55 and older with the annual income of $25,000 = $175,000

87
Q

Homestead exemptions in California qualified dwelling

A

House and land
Mobile home and land
Boat
Condominium
Plan development
Stock cooperative
Community apartment project

88
Q

Homestead exemptions in California qualified homeowners

A

Community or separate property of household and life, or registered domestic partners

Separate property of an unmarried individual

To unmarried persons, sharing ownership, each can claim a separate homestead exemption on the dwelling they both occupy

89
Q

Homestead exemptions in California
priority of claims

A

In order as:
- Tax liens on the Homestead
- Holders of the other liens, and encumbrances on the Homestead
- Home owner, and the amount of the homestead exemption
- The levying officer for the cost reimbursement, if not paid in advance
- Creditors who hold a judgment based on order of filing

90
Q

Primary property in which the owner reside

A

Homestead

91
Q

The total value of property, minus the amount owed

A

Equity

92
Q

The value of the property that is exempt from liens by creditors

A

Homestead exemption

93
Q

Rule that defines the period of time homestead exemption funds are safe from predators before it must be reinvested in a new home stead

A

Six month rule

94
Q

With homestead exemption, sellers need to sell their home, all of the money from the sale will go to pay off their creditors first

True or false

A

False
because they have a homestead exemption and on their home, they can receive up to $175,000 from the sale of their home before creditors will be paid a penny

95
Q

Homestead exemption in California recap

A

Homestead exemptions are available on a wide variety of property types and additional amounts are given to different family units as well.

It’s important to tell your clients be informed about homestead exemption in order to protect the investments. You’ve worked so hard to help them make.

96
Q

Lien priority in California

A

Property, tax liens, special assessments (Mell Roos)
mechanics liens
Homestead exemption amount
Leviyng officer
Other judgment, creditors of unsecured lines, usually in order of filing
Homeowner

If not enough money to pay off liens, an arrangement of subordination agreement will be made

97
Q

Why is it important that liens be paid in full before Property is sold to a new owner?

A

Property transfers to new owner, and the lien remains unpaid, the unpaid lean can trigger a foreclosure

98
Q

Special assessment

A

Government can help property and pay a portion making Mela Roos improvements such as sidewalks, roads powerlines, and considered a tax lien on the property, if not paid

99
Q

Prioritizing liens in order

A

Property, tax liens, along with mello Roos
Secure liens/mechanics liens
Homestead exemption amount
Levying officer reimbursement
All other lines by filing date
Homeowner

100
Q

What is a subordination agreement?

A

Mortgage lien holder A agreed to modify the order of priority and be paid after mortgage lien holder B

101
Q

What happens if there is excess money after liens are paid

A

It is used to pay the expenses of the sale of the property

If there is money left after that, it goes to the former owner of the home

102
Q

What will happen if the lien holders have not been paid?

A

The former owner will lose the property

The former owner might owe a debt to the lien holders who are not fully paid off

The former owner may face a deficiency judgment, after foreclosure, which means losing the property in owing the lien holders

103
Q

What can a property owner do to stop? Contractors performing an authorized work from filing mechanics liens later?

File a lien release

File a notice of completion

Post and file a notice of non-responsibility

Require the contractor obtain a payment bond

A

Post and file a notice of non-responsibility

104
Q

What’s it called when lienholders allow another lienholders claim to have priority over their own?

Equitable lien
Lis pendens
Subordination agreement
Voluntary Lien

A

Subordination agreement

105
Q

Who has the right to make the first bed during a trustee sale in California?

Anyone
The beneficiary lender
The trustee
The Trustor borrowers

A

The beneficiary lender

106
Q

What is the six month rule for homestead exemption?

A

The property owner must reinvest the homestead exemption amount within six months in another homestead to protect it from creditors

107
Q

Which of the following options describes a subordination agreement

A

An agreement between two lien holders to modify the order of lien priority

108
Q

California home owner Randy, owes creditors they place a lien on his home. He owes $35,000 on his mortgage and the properties market value is $250,000. What happens in the situation

A

The homeowner exemption will protect some of his equity, but the courts me force the sale of his home

109
Q

In California, which Lim can be filed later than other liens, and still have priority over them

A

Mechanics lien

Can’t take priority over other liens if the starting date of the project was before other liens filing date

Don’t forget this

If mechanics lien was placed before other liens, it takes priority

110
Q

What does the right of redemption allow?

A

It allows property owner to pay back any debts or liens against the property until a foreclosure sale is held

111
Q

Public records

A

Open to public
Used by buyers to ;
- Verify property ownership
- Identify encumbrances against the property

Prospective buyers can use public records to verify the ownership of the property. They are considering purchasing as well determine if there are any encumbrances against the property.

112
Q

Public records for a deed

A

Used to establish proof of ownership

Legal document
Used to establish proof of ownership
Assurance to buyer that seller has the right to sell the property a marketable title

A marketable title is a title that is clear and free of encumbrances

113
Q

Public records for chain of title

A

Establishes path and proof of ownership

Establishes title history, or the path and proof of ownership
Established through a search for successive conveyances, a title and encumbrances in the public record
Must be unbroken for the title to be good or marketable

Established through the search for successive conveyance of title, starting with the current deed, and going back in time, usually 40 to 60 years. For the title, to be good, the chain must be unbroken.

114
Q

Public records abstract of title

A

Provide a summary of the title history, accompanied by a lawyer’s opinion of Title
- Provide a summary of the chain of title
- Contains a description of the property
- Summarizes any records related to the title
- Updated, abstract, continuation and certified by an attorney, lawyers, opinion of title

The lawyers opinion of title is a statement of opinion regarding the validity of the title

Atturny ensures it is unbroken and clear., Then update the abstract of title with what is referred to as an abstract, continuation and provides a written lawyers opinion a title.

115
Q

Public records certificate of title

A

A summary of the title based off of the title abstracts own title
Lot box, and general indexes

Similar to abstract of title, but based on the title companies title plant
- title search similar to an abstract title
- Based on the title companies owner previously obtain records at the property held in the title plant
- Often not accompanied by a lawyer’s opinion of Teitel, as many of the records used have already been validated

The certificate of title is the next document that is used by title companies that use their own collective records by previous title searches of the public records. These records are stored and lot books and general indexes held by the title companies themselves. These records have come to be called title plants. They are often not accompanied by a lawyer’s opinion of titles, as many of the records have already been validated.

116
Q

Public records grantee of title

A

Oh, and examination and guarantee of the condition of the title, at the time of the search made by the title company

Provides a summary of the title history, and an insurance by the title company of title status based on public records. It does not cover items found in public record.
- similar to the abstract and certificate of title
- Made further assurance of guarantees as the condition of the title based on public records
- The first form of insurance offered by title companies

With a grantee of the title, title companies provided buyers further insurance about the condition of the title, according to public records

117
Q

Establishes proof of ownership

A

Deed

118
Q

Assures that title to the property is free and clear of liens, and only subject to loan payoff and any taxes owed

A

Marketable title

119
Q

Establishes the title history or path, and proof of ownership

A

Chain of title

120
Q

Provide a summary of the chain of title history, usually accompanied by a lawyers opinion a title

A

Abstract of title

121
Q

provides a summary of the chain of title history, similar to an abstract of title, but is based on the title company’s title plant

A

Certificate of title

122
Q

The purpose of the title search is to collect evidence that the title is a marketable title, meaning it’s clear and free of encumbrances
True or false

A

True

123
Q

For Title to be clear, the chain of title must be unbroken
True or false

A

True

124
Q

A certificate of title can be issued using the title companies on records
true or false

A

True

125
Q

Prior to closing, and Atturny will update the abstract of title and provide a written lawyers. Opinion of Title, which verifies that the title is clear after reviewing the title records, thoroughly and verifying, there are no title defects.

True or false

A

True

126
Q

Supplies. An examination of the title history, and a guarantee of its current condition based on what is known on public record.

A

Guarantee a title

127
Q

Provide a summary of the title history. Prior to closing, and Atturny will update the abstract of the title and provide a written certificate of title opinion that the title is clear after reviewing the title records, thoroughly and verifying, there are no title defects.

A

Abstract of title

128
Q

Establishes path and proof of ownership. For a title to be clear, the chain of title must be unbroken

A

Chain of title

129
Q

Preliminary report

A

Issued after title insurance has been ordered and outlines the history of the title, and what will be covered by the title insurance policy, if issued

130
Q

Title insurance policy

A

Ensures the policy owner against financial loss is the title to the real estate has defects beyond what is no in the public records

131
Q

Preliminary report

A

Similar to a title search for abstract, and that it provides a bit of title information from public records for the buyer, but is not a title search itself and is used for outlining what will or will not be covered under the insurance policy, should it be used.

132
Q

Title insurance policy

A

Most commonly used an insurer is the policy owner against financial loss if the title to the real estate has defects.

133
Q

Preliminary report

A
  • issued before a title insurance policy
  • Describe the property, and what title defects will and will not be covered under the insurance policy
  • List the current status of the title in the public record (tax, Liens, or other encumbrances)
  • first document which outlines the events and coverages of the insurance policy that is being applied for
  • Contains a history of title similar to an abstract of title based off the companies records
  • does not take place of a title search or abstract, used to rule out other defects in title
134
Q

Title insurance policy

A
  • Insurance policy owner against financial loss if the title to the real estate has Deepak
  • Protects against title defects, existing at the time of title transfer only
  • Issued only if Teitel is acceptable and certificate of title opinion is provided by an attorney

Last document is title insurance policy, ensures, the policy owner against financial loss of title to the real estate is discovered to have defects. Policy only protects the insured against title defects, existing at the time the title of transferred. Only issued if an attorney verifies that the abstract the title is acceptable and provides a written certificate of title opinion .

135
Q

Level of title insurance coverage
Standard

A

Defects that may exist, but have not been discovered or disclose, such as:
- Forgery or impersonation
- Errors or omissions and legal descriptions
- Improperly recorded deed
- Prior mortgage or Lim

136
Q

Level of title insurance coverage
Extended

A

Defects that are part of standard coverage, as well as additional defects, such as:
- Incorrect survey, and boundary encroachments
- Recorded liens
- Pre-existing zoning violations

137
Q

Describes the property and identifies any outstanding and conferences or, includes what will, and what will not be covered by the insurance policy

A

Preliminary report

138
Q

Fires in a real estate, transaction must be given and acknowledge (sign) a separate notice if no title insurance is provided for the transaction
True or false

A

True

139
Q

Title insurance companies make except referral fees and issue. Preliminary report for free.
True or false

A

False
Excepting referral fees are giving away, free, preliminary report, Oregon state and federal law
are ESPA, and California rebate laws prevent insurers from receiving or giving this kind of indirect payment for title services

140
Q

Title insurance companies often serve as escrow agents
True or false

A

True

141
Q

Lenders policy

A

Required if property is being financed
Protect lenders interest in the property for the same amount of the loan

142
Q

Owners policy

A

The value of the policy decreases as the loan is paid down
Protects the owner and is optional

143
Q

Schedule of exceptions

A

Insurance company will list a schedule of exceptions, typical Events, not covered, include:

  • Liens and encumbrances not shown in public records
  • claim of a person living on the property if there is no public record of tenancy
  • A mechanics lien filed by a contractor who worked on the property and was not paid
  • Taxes and special assessments if liens or not placed on public record
  • Disclosed an undisclosed, easements and rights of way
144
Q

Owners extended coverage

A

Additional insurance buyers can purchase to cover items included in the schedule of exceptions.

Encourage your clients to discuss options with her insurance, representative or an attorney to be sure they’ve covered to the full extent

145
Q

The schedule of exceptions likely to be covered

A
  • claims made known on the public
    -Claims made by a person granted ownership on and on recorded deed
146
Q

The schedule of exceptions that would not be covered

A
  • claim is made by a person living on the property through a lease
  • Mechanics liens that are filed after the title insurance policies effective date
    -Disclosed and undisclosed easements and right of way
    -Taxes and special assessments that haven’t been placed on public record
147
Q

A title that is free and clear from reasonable doubt as to property ownership or defects

A

Marketable title

148
Q

The title history establishes path and proof of ownership

A

Chain of title

149
Q

A search a public records to provide an abstract of title

A

Title search

150
Q

Obtained from a title insurance company to provide evidence of title and summary of title history

A

Abstract of title

151
Q

A statement of opinion regarding the validity of a title abstract

A

Lawyer’s opinion of Title

152
Q

Title companies collection, a title abstracts records, organized by lot or parcel number

A

Lot book

153
Q

Title companies collection of title abstracts records organized by name

A

General indexes

154
Q

The collected records lot books and general indexes of a title company used to issue a certificate of title

A

Title plant

155
Q

A title search performed using a title companies title plant

A

Certificate of title

156
Q

A title search that also guarantees the validity of a title as far as public records allow by the issuing title company. First form of title insurance

A

Guarantee a title

157
Q

Ensures the policy owner against financial loss, if the title to the real estate has defects

A

Title insurance policy

158
Q

Document given to a buyer to inform them of the condition of the titles, and what will be, and will not be covered by the title insurance policy

A

Preliminary report

159
Q

Alternative to obtaining a sellers affidavit of title. Protects the buyer from title defects that are not seen on the public record at the time of the title search.

A

Extended coverage policy

160
Q

Common types of title issues

A
  • Errors in public records
  • Unknown liens
  • missing errors ( heir comes for house)
  • forgeries (false documents)
  • Survey or boundary issues (property lines)
161
Q

Title issues

A
  • they can make financing difficult
  • They put ownership in question
  • They can make it difficult to resolve the property later
162
Q

To medicate title issues, initiate an action to quiet title

Way to mitigate
Not a way to mitigate

A

Way to mitigate

163
Q

Purchase title insurance to medicate the effects of title issues
Way to mitigate
Not a way to mitigate

A

Way to mitigate

164
Q

I asked the buyer, you want to protect yourself before the sale

A

Purchase title insurance

165
Q

The cloud has appeared on the title, and, as the owner, you want to remove it

A

Initiate a quiet title suit

166
Q

A cloud has appeared on the title to the property you own, and want to sell. You need to locate a person who may have some claim on the title and obtain a document from that person to prove that a debt, for instance, has been paid or corrected.

A

Initiate a quiet title suit

167
Q

As a buyer, do you want to be reimbursed after the sale is a title issue does arise

A

Purchase title insurance

168
Q

You should advise client to terminate the purchase if the property title search reveals a cloud on the title
True or false

A

False
Most properties have an existing mortgage and may have other title issues identified by the title company. You should advise your clients to work with the title ensure to make sure the title is cleared before or at closing.

169
Q

You should advise your clients that foreclosed properties may have hidden title issues
True or false

A

True

170
Q

You’re working with a client, Danny, who’s found his dream home in the neighborhood where he grew up. Unfortunately, the title search find some issues, and the title company refuses to issue a policy. Danny still wants to go forward with the purchase, and since he’s paying cash, he doesn’t have to worry about obstacles from a lender. In California, what is one thing that has to happen in the situation?

  • Danny must receive written notice that no title insurance will be provided
  • The escrow agent must record the refusal to provide title insurance with the county clerk and recorder.
  • The seller must use a warranty deed to transfer ownership rather than a grant deed
  • You must refused to continue representing Danny in order to protect your license
A
  • Danny must receive written notice that no title insurance will be provided

California law requires the buyer to receive notice if title insurance won’t be provided. This notice has specific language that must be used, and the notice must be acknowledged by the buyer.

171
Q

Which of the following protects the owner against financial loss if the real estate title has defects
- Abstract of title
- Chain of title
- Deed
- Title insurance

A

Title insurance

172
Q

Which document is used to give a buyer an overview of the title history and information about what is or isn’t covered in an insurance policy?
- Abstract of title
- Guarantee of title
- Preliminary report
- Title insurance

A

Preliminary report

173
Q

Paula is bidding on a property that’s being sold at a foreclosure auction. She’s excited about the great deal she’s getting on the property after she finds out she submitted the winning bid. What could cause Paula’s great deal to turn into a nightmare?

  • The lender has the option to refuse her bed and revoke the deep transferring ownership to Paula
  • The previous owner may redeem the property by ping Paula at least 50% of the properties market value
  • The title insurance company may charge her additional fees after closing to continue the title policy
  • The title to the property may have hidden issues that cost her a lot of money to clear
A

the title to the property may have hidden issues that could cost her a lot of money to clear

Real Estate (39 decks)

Brainscape helps you reach your goals faster, through stronger study habits.
© 2024 Bold Learning Solutions. Terms and Conditions