Real Property Flashcards
What is marketable title?
Title that a reasonably prudent buyer would be willing to accept.
When the buyer of land dies before the real property contract closes, their successors to the buyer’s real property may do what at closing?
Demand a conveyance.
Which party/parties are entitled to specific performance of a sale of land contract?
Both the buyer and the seller.
A title insurance policy owned by a mortgagee protects whom?
The mortgagee only.
A real estate broker will only be considered a buyer’s agent if what?
It is specifically agreed to.
Under the doctrine of equitable conversion, the buyer of the land is considered as owning the land when . . .
the contract is signed.
When the seller of land dies before the contract closes, the successors to the seller’s real property must . . .
give up legal title at closing.
A seller who has not conveyed title will not be considered in breach of her land sale contract if . . .
the buyer tenders the purchase price on the closing date.
The Statute of Frauds requires a contract be ________.
Written
What are the exceptions to the Statute of Frauds writing requirement?
a buyer’s detrimental reliance; the buyer’s acts of partial performance.
The existence of a mortgage on which the Statute of Limitations has run does not make land ____________.
Unmarketable.
Under the doctrine of equitable conversion, the seller of the land holds bare legal title _________ for the buyer.
in trust
Under the doctrine of equitable conversion, if improvements on realty are destroyed without fault before the closing date, the risk of loss is on whom?
The buyer.
What happens if a buyer of land determines the seller’s title is unmarketable?
Notify the seller; give the seller a reasonable time to cure the defects.
What may a buyer do if a seller of land is in breach of a land sale contract at closing?
Demand specific performance if the buyer tenders the purchase price of the land.
What might happen if a seller of land acquires title to land by adverse possession?
The implied covenant of marketability is breached.
How are the damages calculated for a breach of a real estate contract?
Contract Price - Market Value of the land on the date of the breach.
The Statute of Frauds requires that a ____________ of a land sale contract be signed by the party to be charged.
memorandum
How can a buyer of land obtain specific performance of an oral land sale contract?
The buyer has taken possession of the land and made substantial improvements to it.
What can happen if a seller of land breaches the implied covenant of marketable title?
The closing date can be extended to allow the seller time to cure the defect.
A buyer of land who does not tender the purchase price until after the closing date is in breach of the contract if . . .
the seller has conveyed title to the buyer.
How can a land seller avoid liability for property defects on the land?
Including a clause identifying the defects and disclaiming liability for them.
Does a zoning ordinance which restricts the use of land make title to land unmarketable?
No.
Does a prior deed from a grantor who lacked capacity to convey the land make title to land unmarketable?
Yes.
Does a restrictive covenant limiting the development of the land make title to the land unmarketable?
Yes.
Does a hidden easement which reduces the value of the land make its title unmarketable?
Yes.
What kinds of interests are not effected by a foreclosure? What kind are?
Senior interests; junior interests.
Define “mortgage”
A legal security interest in the home for which the loan was made.
A bank makes a home loan secured by a mortgage interest. The owner later defaults on their loan. Who gets the house?
The bank.
Under the doctrine of equitable conversion, a deceased seller’s interest in land generally passes as what?
Personal property.
Are proceeds of a real estate sale personal or real property?
Personal property.
Land devised to someone upon the owner’s death is what kind of property?
Real property.
Under equitable conversion, after a real estate sale contract has been signed, the buyer becomes the equitable owner of the ___________, and the seller becomes the equitable owner of the ___________.
Land; money.
Following the signing of a real estate sale contract, when do the seller and buyer take possession of their respective property?
At closing.
May an easement be resurrected after it has been extinguished?
No.
Fee Simple Determinable —
an estate that will end automatically when the stated event or condition occurs. The interest will revert to the grantor or the heirs of the grantor.
Open-ended conditions in a conveyance evidence a potential violation of what legal doctrine?
The Rule Against Perpetuities.
If a clause of a conveyance is found to violate the Rule Against Perpetuities, what will the court do with the clause?
Delete it.
To create an easement by prescription, the land must be:
open and notorious; adverse; continuous and uninterrupted; and lasting for the statutory period for adverse possession.
Generally, a foreclosure terminates all ______________ that have been joined in the foreclosure action.
junior interests
If an occupier initially has the true owner’s permission to enter the land, may she acquire title to the land by adverse possession?
Yes, if the occupier communicates hostility
A deed generally must contain what in order to be valid?
grantor’s words of intent
A recording act that provides: “Any conveyance of an interest in land, other than a lease for less than one year, shall not be valid against any subsequent purchaser for value, without notice thereof, unless the conveyance is recorded,” is a:
notice statute
“Any conveyance of an interest in land, other than a lease for less than one year, shall not be valid against any subsequent purchaser for value, without notice thereof, whose conveyance is first recorded.” is an example of what?
a race-notice statute.
In order to prevail over a prior grantee under a race-notice statute, when must a subsequent bona fide purchaser record?
Before the prior grantee records.
What is the effect of a grantee of land’s returning a deed to the grantor?
No effect
May a buyer obtain specific performance of an oral land sale contract?
Yes, if the buyer has taken possession of and made substantial improvements to the land
When a seller of land dies before the contract closes, the successors to the seller’s real property must . . .
give up legal title at closing.
In a sale of land contract, who is entitled to specific performance?
Both the buyer and the seller generally are entitled to specific performance
The essential terms of a land sale contract under the Statute of Frauds are:
- A description of the property; 2. An identification of the parties to the contract; and 3. A price and manner of payment, if agreed upon. The Statute also requires the contract to be in writing and signed by the party to be charged.
Does the existence of a mortgage whose statute of limitations has run on land result in the land’s title being unmarketable?
No
In general, a party who fails to tender performance on the closing date:
Has a reasonable time after the closing date to tender performance. Generally, the time of performance stated in a land sale contract is not absolutely binding.
Deed of Trust —
a security interest in land by which the debtor (i.e., the trustor) transfers title to the land to a third party (i.e., the trustee), such as the lender’s lawyer or a title insurance company, acting on behalf of the lender (i.e., the beneficiary).
What does it mean for a grantee to assume a mortgage?
The grantee becomes primarily liable to the lender. The original mortgagor becomes secondarily liable as a surety. Assumption of a mortgage does not mean the grantee becomes a surety for the original mortgagor.
When a mortgagee transfers a promissory note without a written assignment of the mortgage, generally . . .
the mortgage follows the note. No separate written assignment of the mortgage is necessary.
Title Theory —
in a minority of states, legal title is in the mortgagee until the mortgage has been satisfied or foreclosed.
Intermediate Theory —
in some states, legal title transfers from the mortgagor to the mortgagee on default.
Lien Theory —
followed in a majority of the states, the mortgagee is deemed to hold a security interest in the land and the mortgagor is considered the owner until foreclosure.
When may a mortgagor redeem her land in equity?
Before the foreclosure sale.
As between two mortgages, what is the effect on the junior mortgage when the mortgagor accepts an advance of funds from the senior mortgagee?
The junior mortgage is given priority over the advance if the advance was optional
In most states, the reservation of an annual rent, payable monthly, in a lease with no set termination date creates a:
Year-to-year periodic tenancy
If a landlord’s breach of duty renders the premises unsuitable for occupancy, under the doctrine of constructive eviction, the tenant may:
Vacate the premises, terminate the lease, and sue for damages
If a landlord consents to one transfer that violates a covenant against assignment or sublease, he _________ his right to avoid future transfers.
waives
May a tenant remove a chattel that the tenant affixed to the leased premises?
No, because chattels affixed to the leased premises become the property of the landlord
A fee simple subject to an executory interest is an estate that:
Automatically divests in favor of a third party on the happening of a stated event
A grantor who conveys a fee simple determinable retains:
A possibility of reverter
