Property Flashcards
Define Real Property
Land, items firmly attached to land, things under the land, and air above the land
Personal Property can be either _____ or ______
Tangible or Intangible
This property is items that you can physically hold
Tangible Property
This property is interests or rights that are not capable of physical possession
Intangible Property
These are personal property that is so attached to real estate that it becomes real estate as a matter of law
Fixtures
Whether or not an item is a fixture depends on what three things?
1) Intention of the party who attached it
2) How it is attached to the real estate
3) If removal would cause damage to the real estate
T/F
Trade fixtures (items used in a trade or business) are usually considered real property
FALSE
They are considered personal property
What are the three ways of acquiring personal property?
1) By Gift
2) By Inheritance
3) By Finding Property
This is a present, voluntary transfer of property without consideration
a gift
What three elements does a gift have?
1) Donative Intent
2) Delivery
3) Acceptance
T/F
A promise of a gift is enforceable
FALSE
It is unenforceable because there is no delivery, which is one of the elements of a gift
This is a gift that is made while the donor is still living, once made it is irrevocable
Inter Vivos Gift
This is a gift that is made while the donor is still living, however it is automatically revoked if the donor doesn’t die
Gift Causa Mortis aka “Deathbed Gift”
What are the two ways that an individual can acquire personal property by inheritance?
Either by will or by intestate succession if there is no will
What is intestate succession?
These are state laws that dictate how an individual’s assets will be divided (for instance, wife gets x%)
What is the downside of intestate succession?
People are given your inheritance in a way that you may not have wanted/intended
T/F
With lost or mislaid property, the finder gets good title against everyone
FALSE
The finder gets good title against all but the true owner
T/F
With abandoned property, the finder gets good title against everyone, including against the true owner
TRUE
What are the four elements of a deed?
1) must be in writing
2) must be signed by grantor
3) must contain a description of the property
4) must be delivered
This is the type of deed that gives the best protection
A general warranty deed
This type of deed has good title, the right to convey (ownership), no unstated encumbrances (liens), and thus the buyer’s title will be undisturbed by any adverse claims of ownership from others
a general warranty deed
This is a deed that only guarantees ownership for the time the seller owned the property
a special warranty deed
This is the type of deed that gives the least protection
a quitclaim deed
With this type of deed, the grantor gives whatever title or interest they have, but they don’t guarantee that they have anything
a quitclaim deed
T/F
A General Warranty Deed is the only type of deed that promises an implied warranty of marketability (a deed free from reasonable doubt)
FALSE
All deeds promise an implied warranty of marketability (a deed free from reasonable doubt)
T/F
A General Warranty Deed is the only type of deed that promises there are no unstated encumbrances (no unstated mortgages, liens, easements, etc.)
FALSE
All deeds promise there are no unstated encumbrances (no unstated mortgages, liens, easements, etc.)
This protects the owner against losses due to defects of record in their title
Title Insurance
T/F
Title Insurance Policies may make exceptions to the title coverage
TRUE
T/F
Title Insurance Policies can be assigned to a 3rd party in certain circumstances
FALSE
Title Insurance Policies cannot be assigned to a 3rd party
T/F
Title Insurance Policies only insure that there are no defects of record and only up to the date of policy
TRUE
This gives constructive notice to all subsequent 3rd parties of your interest
Recording of Deeds and Mortgages
T/F
You do not need to record deeds or mortgages to give sellers or mortgagors notice
TRUE
Sellers and/or Mortgagors should already know based on their involvement with the transaction
Why is it important to record deeds and mortgages?
If deeds or mortgages are unrecorded, a subsequent party may obtain a superior interest in the property
What are the 3 different types of recording deeds and mortgages?
1) Notice Jurisdiction
2) Race Jurisdiction
3) Notice-Race / Race-Notice Jurisdiction
This is when failure to record a deed/mortgage means you lose to subsequent parties without notice of your interest, whether or not they recorded
Notice Jurisdiction
This is when the first to record a deed/mortgage wins, whether or not they have notice of the other parties interest
Race Jurisdiction
This is when failure to record a deed/mortgage means that you lose to subsequent recording parties without notice of your interest
Notice-Race / Race-Notice Jurisdiction
What happens when an owner dies for tenants in common?
The interest is inherited by the heir of the owner who dies
What happens when an owner dies for joint tenants?
The interest goes to surviving owners
T/F
In a tenants in common relationship, an owner can transfer their interest without the other co-owner’s permission
TRUE
T/F
In a joint tenants relationship, an owner cannot transfer their interest without the other co-owner’s permission
FALSE
An owner can transfer their interest without the other co-owner’s permission; however, the buyer has to become a tenant in common
Joint Tenancies have what 4 elements? (PITT)
Possession - each has an undivided right to use the whole property
Interest - each joint tenant’s interest is of the same type and duration
Time - each joint tenant’s interest arose at the same time
Title - each acquired their title by the same instrument
This is a joint tenancy that is solely between a husband and wife
Tenants by the Entirety
T/F
In a Tenants by the Entirety relationship, neither owner may transfer their interest without their co-owner’s permission
TRUE
If the type of co-ownership is unclear, the law counts it as what type of ownership?
A Tenancy in Common
This is a lien on land to secure payment of a debt
A mortgage
T/F
A mortgagee may assign a mortgage even if prohibited by the contract
TRUE
What act regulates mortgages?
the Real Estate Settlement Procedures Act (RESPA)
What are the four elements of a mortgage?
1) Must be in writing
2) Must be signed by the mortgagor
3) Contains a description of the property
4) Must be delivered
What is the right of redemption in regards to a mortgage?
This is the mortgagor’s rights to redeem the property after they’ve defaulted, but prior to a judicial sale. This is done by paying all mortgages in full. It is a highly unlikely scenario
This is when the buyer agrees to be liable and the seller is still liable
Assuming of a Mortgage
This is when the buyer agrees to be liable and the mortgagee releases the original mortgagor
Novation
This is when a buyer is not liable, only the seller (original mortgagor) is liable. This means that the buyer runs the risk of foreclosure if the seller doesn’t pay
Buying Subject To
T/F
Leases do not require a writing unless the lease is for MORE than 1 year
TRUE
T/F
A written lease requires a description of the lease premises
TRUE
T/F
A due date for rent payment is not required in a lease writing
TRUE
What is the difference between assigning a lease and subletting a lease?
In an assignment, the new tenant pays the landlord
In a sublet, the new tenant pays the old tenant and the old tenant pays the landlord
T/F
In an assignment, the assignor is no longer liable for rent if the assignee defaults
FALSE
The assignor is still liable for rent if not paid
T/F
In a sublet, the sublessor is still liable for rent if not paid
TRUE
T/F
Death or sale of the property ends a lease
FALSE
It does not end a lease. This should be stated in a lease.
This is a temporary transfer of possession, but not title, of personal property by a rightful owner (Bailor) to another (Bailee)
Bailement
What are the three elements of bailments?
1) Delivery of personal property (not real estate) by a bailor to a bailee
2) Transfer of possession of the personal property but not ownership.
3) Imposes absolute duty on bailee to return or send the item as bailor directs
In a bailment, who is presumed to be negligent/liable if the goods are lost or destroyed?
The bailee
T/F
If the bailee can prove that the goods were lost or damaged through no fault of the bailee, then the bailee is not liable
TRUE
When does a bailee have absolute liability, without regard to fault?
1) The bailee is strictly liable for unauthorized use of the property
2) The bailee is strictly liable for misdelivery (this is because of the element of absolute duty to return the goods to the right person)
Those in the business of transporting the public’s goods are also known as…?
Common Carriers or Extraordinary Bailees
T/F
Common carriers are strictly liable for any loss/damage to the goods regardless of fault.
FALSE
There are two exceptions to this statement:
1) Carriers are not liable for loss due to goods improperly packed by the party shipping them.
2) Carriers are not liable for Acts of God (floods, tornadoes, etc.)
T/F
Bailees and common carriers may limit their liability by contract
TRUE
T/F
Patent law is largely based on state law
FALSE
Patent law is exclusively federal law
T/F
Accessing a digital work is protected by the fair use doctrine
FALSE
T/F
Financial and business models used over the internet can be patented
TRUE
T/F
Both the purchase price and the description of the land must be contained in a valid deed
FALSE
Only a description of the land is to be contained in a valid deed. The purchase price will fluctuate and is part of individual real estate contracts, not the original deed
T/F
For a deed to be effective between the purchaser and the seller of real estate, the deed must contain the signatures of both the purchaser and the seller
FALSE
The deed need only be signed by the seller to be effective
T/F
For a deed to be effective between the purchaser and the seller of real estate, the deed must contain the actual sales price
FALSE
Only a description of the land is to be contained in a valid deed. The purchase price will fluctuate and is part of individual real estate contracts, not the original deed
T/F
For a deed to be effective between the purchaser and the seller of real estate, the deed must be delivered by the seller with an intent to transfer title
TRUE
T/F
For a deed to be effective between the purchaser and the seller of real estate, the deed must be recorded within the permissible statutory time limits
FALSE
The deed need not be recorded to be valid. Recording is important because it gives constructive notice to all third parties of the ownership, however it does not affect the agreement between the seller & purchaser
T/F
Real estate title insurance gives coverage for the title exceptions listed in the policy
FALSE
Title exceptions are not insured against
T/F
Real estate title insurance gives insurance against all defects of record other than those excepted in the policy
TRUE
T/F
Real estate title insurance gives coverage for title defects that result from events that happen after the effective date of the policy
FALSE
Title insurance covers only defects of record
T/F
Real estate title insurance gives the purchaser the right to transfer the policy to subsequent owners
FALSE
Insurance is not transferable as it is generally based on the risk of an individual
T/F
The Real Estate Settlement Procedures Act (RESPA) & the Federal Trade Commission Act both regulate mortgage lenders
FALSE
Only the RESPA regulates mortgage lenders, not the Federal Trade Commission Act
T/F
For a mortgage to be enforceable there must be an accurate description of the property included in the mortgage
TRUE
The mortgage must be in writing and include a description of the property and debt to be incurred
T/F
For a mortgage to be enforceable there must be a negotiable promissory note accompanying the mortgage
FALSE
Although debt is usually evidenced by a promissory note this is not required
T/F
For a mortgage to be enforceable there must be present consideration given in exchange for the mortgage
FALSE
The promise to pay is adequate consideration
T/F
For a mortgage to be enforceable the amount of the debt and the interest rate must be stated in the mortgage
FALSE
T/F
By recording a mortgage, the lender protects their rights against the borrower under the promissory note
FALSE
T/F
By recording a mortgage, the lender protects their rights against the claims of subsequent bona fide purchasers for value
TRUE
T/F
By recording a mortgage, the lender protects their priority against a previously filed real estate tax lien on the property
FALSE
T/F
By recording a mortgage, the lender protects their priority against all parties having earlier claims to the property
FALSE
T/F
For a written residential lease to be enforceable it must have a description of the leased premises and a due date for the payment of rent
FALSE
Only the description of the leased premises is required. A due date for the payment of rent is not required.
T/F
Obtaining personal property through a lease and through finding abandoned property are both valid ways for a recipient to obtain ownership of the property
FALSE
Obtaining property through a lease does not give an individual ownership of the property. However, finding abandoned property does give the individual ownership of the property
