Property - contracts and deed

Question 1

Real estate contract

Answer 1

• Must be in writing
• Part performance exception - 2 of: payment, possession, improvement
• Terms:
  
  • Price
  • Parties
  • Description
  • Conditions
    Signed by party to be charged

Question 2

Equitable conversion

Answer 2

• Transferring equitable title on the date of signing K
• Risk of loss shifts to buyer
  Seller doesn’t need legal title at signing

Question 3

Marketable title

Answer 3

• Implied covenant to convey title free of encumbrances or liens
• Time is not of the essence unless stated
  CONTRACT

Question 4

Merger

Answer 4

• At closing, K merges into the deed
  Can no longer sue under K

Question 5

Duty to disclose

Answer 5

• S must disclose material defects that cannot be seen by B

Question 6

Deed

Answer 6

• Transfers legal title on day of closing
  Warranty deed
• six warranties
  
  • Present: seisin, right to convey, covenant against encumbrances (must be breached at closing)
    Future: quiet enjoyment, warranty, further assurances

Question 7

Types of deeds

Answer 7

• General: promises all 6 warranties since property developed/created
• Special: promise for all six warranties since seller had title
  Quitclaim deed: No promises regarding title.

Question 8

Closing formalities

Answer 8

• Must be in writing. SOF
• Delivery: intent of seller to give up control
• Acceptance is presumed unless rejected
• Merger: real estate K and deed MERGE
• description of property must be reasonably definite
  must have identifiable grantee

Question 9

Transfer of title

Answer 9

• By will: if no will, intestate succession. If will but sells, then goes to the buyer.
• Lapse: grantee dies before grantor, goes to residuary estate
  Lien on will: grantor’s estate will pay off liens

Question 10

Adverse possession

Answer 10

• Legal ownership through
  
  • Continuous for statutory period. Tacking allowed (intentional transfers and comes back)
  • Actual, open, and notorious
  • Hostile (without owner’s permission)
    Exclusive

Question 11

Drafting and executing document

Answer 11

• nonlawyer may draft and close if no legal advise
• Equal dignity rule: agent may sign deed on behalf of grantor with written permission
  Exception: officer of corporation or signing agent. BUT grantor can’t use no-writing defense if grantee’s reliance of authority.

Question 12

Recording statutes

Answer 12

• Race: first person to record prevails
• Race notice: first BFP who recorded. “first recorded”
• Notice: “subsequent purchaser for value without notice”
  
  • BFP: pay for property, take property without notice
  • Last BFP wins
  • NOT BFP: gift, will, CREDITOR, or adverse possession
  • Mortgagees ARE BFP
    Recording gives everyone notice!

Question 13

Shelter rule

Answer 13

One who takes from a BFP will prevail against anyone the transferor-BFP would have prevailed against

Question 14

Wild deed

Answer 14

• A recorded deed out of chain of title. Og grantee prevails.

Question 15

Purchase money mortgage

Answer 15

• Money used to purchase the property
  Always gets paid back first

Question 16

Redemption

Answer 16

• Redeeming the property in foreclosure (mortgagee) by paying off
• Equitable right of redemption: time from notice to foreclosure sale. Never waived.
  Statutory redemption: period of time after foreclosure sale.

Question 17

Lien theory vs title theory

Answer 17

• Lien theory: bank only has a lien. Owner holds title. Owner can sell.
  
  • Mortgage doesn’t sever joint tenancy
• Title theory: bank has title. Owner only has equitable interest. Owner cannot sell. Gets title when paid off.
  
  • Mortgage severs joint tenancy into tenancy in common
• Assuming mortgage vs. subject to mortgage
  
  • Assumable: new buyer takes over mortgage. og party secondarily liable unless novation.
    Subject to: og party still liable. New buyer not liable. But bank can foreclose on the house.

Question 18

Deed in lieu of foreclosure

Answer 18

• Sign deed to bank and skip foreclosure proceedings

Question 19

Foreclosure sale

Answer 19

• Mortgages taken out AFTER defaulting loan are wiped out: must give notice, joined to suit
  Mortgage taken out before defaulting loan stays. Buyer takes subject to.

Question 20

Deficiency judgment

Answer 20

• Collect the remaining money from mortgagor not recovered by foreclosure sale

Question 21

Installment land K

Answer 21

• No title until all payments made
  Seller can take back after default

Question 22

After-acquired title

Answer 22

If grantor acquires title after closing, title will pass automatically to grantee