Interest in Real Estate Flashcards
When a property’s ownership is recorded publicly so everyone can know the contents of recorded documents
Constructive Notice
When an individual actually knows of the fact b/c the buyer has taken possession of the property which is an action that creates _______ ________ that others can observe directly.
actual notice
The official opinion of an attorney regarding the condition of a property’s title
opinion of title
A condensed history of title to a tract of land that summarizes the transfers of ownership & encumbrances
abstract of title
A policy that protects homeowners from certain financial losses due to title issues, such as defects, encumbrances, & liens
Title Insurance
Real estate license holders are required to tell every buyer they should….
obtain an abstract of title & have it examined by an attorney or receive a policy of title insurance.
The degree, quantity, & extent of interest one owns in a property
Estate
- Estates that are created as a matter of state law
- Can vary from state to state
Statutory Estates
What are the 4 main types of estates?
1.) Freehold Estates
2.) Leasehold Estates
3.) Equitable Estates
4.) Concurrent Estates
The individual w/interest has some degree of ownership for an undetermined/unspecified & unlimited period of time
Freehold Estates
What are the 3 types of freehold estates?
1.) Fee Simple Estates
2.) Defeasible Fee Estates
3.) Life Estates
- The least limited, most absolute, interest in real property
- of indefinite duration, freely transferable, & freely inheritable
- owner has the clearest & most pure ownership of the property w/o any strings attached
Fee Simple Estate
- A property interest characterized by perpetual ownership on the condition that the property is used for a certain purpose or under specific conditions
- Ownership reverts back to the original owner if these stipulations are violated
Defeasible Fee Estates
What are the 2 common forms of defeasible fee estates?
1.) Fee Simple Determinable
2.) Fee Simple Subject to Condition Subsequent
This particular defeasible estate will come to an end automatically & immediately upon the occurrence of a designated event, the time of such occurrence is uncertain.
Fee simple determinable estate
The previous owner would have to go to court to prove that they should be the owner
Fee Simple Subject to Condition Subsequent
If the reversion to the original owner is automatic, then it is a ___ ______ _________ estate, but if the reversion requires going to court, then it is ______ __ _ _______ _________.
Fee simple determinable, subject to a condition subsequent
Refers to the estate that will pass to another party at the death of the person upon whom the life estate is based
Remainder
- When the property reverts back to the person who granted it in the 1st place once the life estate’s measuring life ends
- “Right of reverter”
Reversionary Interest
Refers to the recipient of the remainder
Remainderman
If no 3rd party is named as remainderman, when a life estate owner dies, the property reverts to the ….
grantor.
What are the 2 different types of life estates?
1.) Conventional Life Estate
2.) Legal Life Estate
- An estate created by the grantor that is based on the life of the life tenant OR the life of another
- pur autre vie
Conventional Life Estate
Describes a life estate that grants 1 party ownership of a property for the duration of another individual’s life
Pur Autre Vie
An estate created by state statute
Legal life estate
- 1 party owns the property, but someone else lives there
- Evidenced by a lease
Leasehold Estates
The tenant’s right of possession continues until the lease has expired
Leasehold estates
Possession of the property reverts back to the landlord after the lease term has expired
Reversionary right
The landlord’s interest in the property is specifically known as a….
“leased fee estate plus reversionary right”
The tenant who leases real property has a _________ interest in the property.
leasehold
The landlord has a ________ ___ _______ in the property that they own.
leased fee interest
What are the 4 types of leasehold estates?
1.) Estate for Years
2.) Periodic Estate
3.) Estate at Will
4.) Tenancy at Sufferance
