MBE Real Property

Question 1

Name the types of three types of deeds in order of most protection to least protection.

Answer 1

1. General warranty deed.
2. Special warranty deed.
3. Quitclaim deed.

Question 2

Name all of the implied covenants of contained in a general warranty deed.

Answer 2

1. Covenant of seisin.
2. Covenant of the right to convey.
3. Covenant against encumbrances.
4. Covenant of quiet enjoyment.
5. Covenant of warranty.
6. Covenant of future assurances.

Question 3

What is the primary difference between a general warranty deed and a special warranty deed?

Answer 3

A general warranty deed protects the buyer from all defects in title, no matter who causes them. A special warranty deed protects only against defects in title caused by the grantor.

Question 4

The covenant of seisin provides that… what?

Answer 4

That the deed describes the land in question.

Question 5

The covenant against encumbrances provides… what?

Answer 5

That there are no undisclosed encumbrances on the land conveyed.

Question 6

The covenant of quiet enjoyment provides… what?

Answer 6

That the grantor will defend against future challenges to the grantee’s title to the property.

Question 7

The covenant of warranty provides… what?

Answer 7

That the grantor will defend against future assertions of encroachment.

Question 8

The covenant of future assurances provides… what?

Answer 8

That the grantor will fix future title problems.

Question 9

Provide the common law and New York names for the type of estate is indicated by words such as “so long as.”

Answer 9

Fee simple determinable (common law).

Fee on limitation (NY).

Question 10

What kinds of future interests may follow a life estate?

Answer 10

A reversion, where the the property reverts back to the grantor. A remainder where the property vests in a third party.

Question 11

Name the estate and future interest: “O to A for life, then to B.”

Answer 11

Life estate followed by a remainder.

Question 12

Name the estate and future interest: “O to A, but if not used as a farm, then to B.”

Answer 12

A fee simple subject to an executory interest. Followed by an executory interest.

Question 13

In New York, what five elements must a life estate holder show to defend against a claim of ameliorative waste?

Answer 13

1. the change is one that a prudent fee simple owner would make;
2. the change does not reduce the market value of the property;
3. the change does not violate an agreement binding the life estate holder;
4. the life tenant has a life expectancy of more than five years at the time of the change; and
5. the life tenant serves notice on all future interest holders at least 30 days before the change is made.

Question 14

What four elements must be present to create a joint tenancy?

Answer 14

1. each tenant has an equal right to possess the whole property;
2. each tenant has an equal share of the same type of interest;
3. the joint tenants receive their interests at the same time; and
4. the joint tenants receive their interests through the same instrument.

Question 15

What rights does a mortgagee (lender) have in a title theory state that it does not have in a lien theory state?

Answer 15

A mortgagee in a title theory that holds legal title to the property until the debt is satisfied, and may possess the property at any time. In a lien theory states, legal title remains with the mortgagor (homeowner) until foreclosure.

Question 16

In both title theory and lien theory states, what happens when one joint tenant takes out a mortgage on her interest?

Answer 16

In a title theory state, the joint tenancy and the right of survivorship is severed, and the estate becomes a tenancy in common.

In a lien theory state, the mortgage is treated as a lien and the joint tenancy survives. Upon the mortgagor’s death, the lien terminates and does not encumber the other joint tenant’s interest.