Real Property Flashcards
What is real property?
a legal term that encompasses land and any improvements or structures attached to the land
Real property includes not only physical surface of the land but also
everything that is permanently attached to it such as buildings, trees, minerals, and other fixtures
Key components of real property
land
improvements
fixtures
mineral rights
What is land?
the surface of the earth including soil, rocks and any natural features
What are improvements?
man-made additions or enhancements to the land. Buildings, houses, roads, fences
What are fixtures?
items that were once personal property but have become permanently attached to the land or structures
What are mineral rights?
minerals beneath the surface of the land
Co-Tenancy
exists when two or more people have a right in the possession and use of the same property
In Maryland co-tenancy exists when property is owned as joint tenants, tenants in common or tenants by the entirety
If no tenancy is recited in a deed with multiple owners there is a presumption that the
property is owned as tenants in common
If no tenancy is recited in a deed and the grantees are married it is presumed that the property is held as
tenants by the entirety
If there is a judgment against one tenant in an co-tenancy then
the tenancy is NOT destroyed
A judgment against one tenant by the entirety…
does not attach to the property unless the tenancy is severed or lien is a federal tax lien
Fee Simple
the highest form of ownership. It represents an ownership in property with the right of unconditional and full power during the owner’s lifetime
Owner possess unlimited duration, disposition and descendibility
Life Estate
an interest created for the term of a person’s life. It ends at the death and interest is passed to a remainderman
Two types of trusts
Revocable and irrevocable
Revocable trust
also known as a living trust can be altered until the death of the individual for whom it was established (the grantor or settlor)
Irrevocable trust
cannot be changed once it is finalized.
Under a irrevocable trust the
trustee holds legal title while the beneficiary holds equitable interest
What is a leasehold estate?
a possessory estate created by a lease agreement
Example: owner of a property in which there is a ground rent or an owner o an apartment building with tenants
What is ground rent estate
a type of leasehold estate established on a lot and the improvements on it
How long is a ground rent lease
It is usually for a term of 99 years and automatically renewable
What is ground rent redemption
tenant to a property has a right to redeem the ground rent/purchase the reversionary interest in a property and convert the property to fee simple
What is ground rent ejectment
maryland law provides a ground rent owner/landlord may seek ejectment if the ground rent lease is for a term of 99 years and six months of ground rent payments are past due
The greatest protection against any claims to property is
to record
Recording protects who
grantees against a party that may have actual notice and it gives constructive notice to the world that the purchaser or grantee has an interest in property
Before an actual title examination begins it is helpful to
gather as much information as possible about the property being examined
Once information is gathered from a title examination a
title search is ordered.
Grantors
transferring the property
Grantees
receiving the property
What is the effective date of title search?
the last day which the title has been run
Full search
to identify any potential issues or defects in the property
Limited search
is for a period of time less than that of a full search. Generally conducted on refinance, loan assumptions or second mortgage transactions
Chain of Title
reverse chronological order listing of the names of all people who have owned a parcel of land or property for a specific number of years
Abstract of title
includes a report of title and any other written or electronically created or preserved representation of the state of title to property
Certificate of title
affirms and certifies the status of the property through the date that the certificate is issued
Race-Notice
a recording statute that govern the priority of interests in real property
Race element
priority of conflicting interests is determined by the timing of recording. The first party to record a document at the recorder’s office has priority regardless of whether they had actual notice of other claims
Notice element
requires that a subsequent purchaser or mortgagee must have no notice of prior transaction or claim at the time of acquiring their interest. This notice can be actual notice, constructive notice, or implied notice
Maryland is a race-notice state meaning that
the first in time to record has superiority over other recordings
Exception to race-notice
a deed that is record first in time may be invalid if the grantee is no a good faith purchaser, does no purchase for value, has constructive notice
Bona Fide Purchaser
one who has paid full value for a property and has no knowledge of any outstanding interest held by third parties
