section 6 Transferring and Recording Title to Real Estate

Question 1

Which of the following best describes the concept of “legal title” to real estate?”
a. Ownership of the bundle of rights to real estate
b. The right of a buyer or lender to obtain ownership under certain circumstances
c. Possession of a deed
d. Absolute proof of ownership of real estate

Answer 1

a. Ownership of the bundle of rights to real estate

Question 2

A person claims ownership of a parcel of real estate to a prospective buyer, stating that she has lived on the property for five years and nobody has ever bothered her. The claimant also shows the buyer a copy of the deed. The legal basis of this claim is referred to as
a. prescriptive notice.
b. constructive notice.
c. hostile notice.
d. actual notice.

Answer 2

d. actual notice.

Question 3

Constructive notice of ownership of a parcel of real estate is primarily demonstrated through
a. direct inspection to see who is in possession.
b. title insurance.
c. title records.
d. a construction permit

Answer 3

c. title records.

Question 4

An owner transfers title to a property to a buyer in exchange for a consideration. This is an example of
a. voluntary alienation.
b. escheat.
c. hypothecation.
d. estoppel.

Answer 4

a. voluntary alienation.

Question 5

For a deed to convey title, it is necessary for the deed to be
a. on a standard form.
b. certified by the grantor.
c. accepted by the grantee.
d. signed by the grantee.

Answer 5

c. accepted by the grantee.

Question 6

The only required clause in a deed of conveyance is one that
a. states restrictions and limitations to the estate being conveyed.
b. states the parties and the type of estate being conveyed.
c. states that the grantor has done nothing to impair title to the property being conveyed.
d. states the grantor’s intention, names the parties, describes the property, and indicates a consideration.

Answer 6

d. states the grantor’s intention, names the parties, describes the property, and indicates a consideration.

Question 7

The purpose of a covenant clause in a deed of conveyance is to
a. state the grantor’s assurance or warrant to the grantee that a certain condition or fact concerning the property is true.
b. state the grantee’s promise to use the property in a prescribed manner.
c. warrant that the grantor has never encumbered title.
d. describe the consideration that the grantee promises to give in return for title.

Answer 7

a. state the grantor’s assurance or warrant to the grantee that a certain condition or fact concerning the property is true.

Question 8

The type of statutory deed that contains the most complete protection for the grantee is a
a. guardian’s deed.
b. special warranty deed.
c. general warranty deed.
d. quitclaim deed.

Answer 8

c. general warranty deed.

Question 9

A person wishes to convey any and all interests in a property to another without making any assurances as to encumbrances, liens, or any other title defects on the property. This party would most likely use which of the following types of deed?
a. A sheriff’s deed
b. A special warranty deed
c. A partition deed
d. A quitclaim deed

Answer 9

d. A quitclaim deed

Question 10

A one-time tax levied on a property for purposes of recording a transaction is called
a. an intangible sales tax.
b. a documentary stamp tax.
c. an ad valorem tax.
d. a franchise tax.

Answer 10

b. a documentary stamp tax.

Question 11

If a person dies with no legal heirs or relations and has left no valid will, what happens to real property owned by that person?
a. It is taken by the state according to the process called escheat.
b. It is reconveyed to the previous owner in the chain of title.
c. It is taken by the title insurance company according to the process called involuntary alienation.
d. It is conveyed to the highest bidder at a public auction.

Answer 11

a. It is taken by the state according to the process called escheat.

Question 12

Just prior to passing away, a person tells two witnesses that she would like her estate to pass to her husband. One witness records the statement and signs his name. This is an example of
a. an enforceable holographic will.
b. an unenforceable holographic will.
c. an enforceable nuncupative will.
d. an unenforceable nuncupative will.

Answer 12

d. an unenforceable nuncupative will.

Question 13

If a person having several heirs dies intestate, the property will
a. pass to heirs by the laws of descent and distribution.
b. escheat to the state.
c. pass to the surviving spouse through elective share.
d. pass to the surviving heirs according to the provisions of the will.

Answer 13

a. pass to heirs by the laws of descent and distribution.

Question 14

A property owner can avert the danger of losing title by adverse possession by
a. recording proof of ownership in county title records.
b. inspecting the property and evicting any trespassers found.
c. claiming hostile and notorious possession.
d. filing a claim of right with the county recorder.

Answer 14

b. inspecting the property and evicting any trespassers found.

Question 15

A hermit secretly lives in a cave on a 200-acre property. After twenty years, the person makes a claim of ownership to the property. This claim will likely be
a. upheld through adverse possession.
b. upheld because of the length of possession.
c. declined through the doctrine of prior appropriation.
d. declined because possession was secretive.

Answer 15

d. declined because possession was secretive.

Question 16

The fundamental purpose of recording instruments
that affect real property is to
a. prove ownership of the property.
b. avoid adverse possession.
c. give constructive notice of one’s rights and interests in the property.
d. assemble all relevant documents in a single place.

Answer 16

c. give constructive notice of one’s rights and interests in the property.

Question 17

What is “chain of title?”
a. The list of all parties who have ever owned real estate.
b. The bundle of rights linked to the recorded title to a parcel.
c. A chronology of successive owners of record of a parcel of real estate.
d. Involuntary conveyance of title by statutory rules of descent.

Answer 17

c. A chronology of successive owners of record of a parcel of real estate.

Question 18

The Torrens System differs from other title recording systems in that
a. title is conveyed only when conveyance is registered on the title certificate.
b. the Torrens System requires prior approval of a transaction before it can be registered.
c. the Torrens System is not recognized by title insurance companies.
d. it allows unrecorded encumbrances to cloud title.

Answer 18

a. title is conveyed only when conveyance is registered on the title certificate.

Question 19

To be marketable, title must be
a. registered in Torrens.
b. free of undisclosed defects and encumbrances.
c. abstracted by an attorney.
d. guaranteed by a title certificate.

Answer 19

b. free of undisclosed defects and encumbrances.

Question 20

With the exception of a Torrens certificate, the best evidence of marketable title is
a. a signed deed.
b. a title certificate.
c. title insurance.
d. an attorney’s opinion.

Answer 20

c. title insurance.

Question 21

Ownership of real property as well as evidence of such ownership; legal title.

Answer 21

title

Question 22

Full legal ownership of property and the bundle of rights as they apply to it. Contrasts with equitable title.

Answer 22

legal title

Question 23

An interest that gives a lienholder or buyer the right to acquire legal title to a property if certain contractual conditions occur.

Answer 23

equitable title

Question 24

Knowledge given or received directly through demonstrable evidence. Actual notice of ownership: reading a bill of sale, inspecting a deed, searching title records.

Answer 24

actual notice

Question 25

Knowledge one could or should have, according to the presumption of law; a demonstration to the public of property ownership through title recordation, “for all to see.”

Answer 25

constructive notice

Question 26

A transfer of title to real property by voluntary or involuntary means.

Answer 26

alienation

Question 27

A voluntary transfer of real property interests.

Answer 27

conveyance

Question 28

Voluntary alienation. Voluntary alienation is an unforced transfer of title by sale or gift from an owner to another party. If the transferor is a government entity and the recipient is a private party, the conveyance is a public grant. If the transferor is a private party, the conveyance is a private grant. A living owner makes a private grant by means of a deed of conveyance, or deed.

Answer 28

deed of conveyance

Question 29

Execution of a valid deed in itself does not convey title. It is necessary for the deed to be delivered to and accepted by the grantee for title to pass. To be legally valid, delivery of the deed requires that the grantor:

be competent at the time of delivery
intend to deliver the deed, beyond the act of making physical delivery
Validity of the grantee’s acceptance requires only that the grantee have physical possession of the deed or record the deed.

Answer 29

delivery and acceptance

Question 30

State law usually requires payment of a documentary stamp tax on a conveyance of real property. The tax is based on the actual price of the property conveyed, thus enabling taxing authorities to ascertain current market value for ad valorem tax purposes. Payment of the tax is evidenced on the deed.

Exemptions from transfer tax include:

-transfer within the immediate family
-consideration less than a certain amount
-transfer between government entities or non-profit organizations
-trust deed transfer and reconveyance
-tax deed

Answer 30

documentary stamp tax

Question 31

A will, or more properly, a last will and testament, is a legal instrument for the voluntary transfer of real and personal property after the owner’s death. It describes how the maker of the will, called the testator or devisor, wants the property distributed.

Answer 31

will

Question 32

A will, or more properly, a last will and testament, is a legal instrument for the voluntary transfer of real and personal property after the owner’s death. It describes how the maker of the will, called the testator or devisor, wants the property distributed.. A beneficiary of a will is called an heir or devisee. The property transferred by the will is the devise.

Answer 32

testator

Question 33

A transfer of real or personal property from the devisor to the devisee(s) by means of a will.

A will, or more properly, a last will and testament, is a legal instrument for the voluntary transfer of real and personal property after the owner’s death. It describes how the maker of the will, called the testator or devisor, wants the property distributed.. A beneficiary of a will is called an heir or devisee. The property transferred by the will is the devise.

Answer 33

devise

Question 34

A court proceeding to validate and distribute a decedent’s estate to creditors, tax authorities, and heirs.

Answer 34

probate

Question 35

The legal condition of a person who dies leaving a valid will.

Answer 35

testate

Question 36

Legal condition of a person who dies without leaving a will.

Answer 36

intestate

Question 37

If the decedent died without a valid will, the estate passes to lawful heirs according to the state’s laws of descent and distribution, or succession. Laws of descent stipulate who inherits and what share they receive, without regard to the desires of the heirs or the intentions of the deceased.

Answer 37

Descent and Distribution:

Question 38

A reversionary transfer of real property to the state or county when the legal owner dies without a will and without heirs

Answer 38

Escheat

Question 39

A power of a government entity to force the sale of private property for subsequent public use.

Answer 39

Eminent Domain:

Question 40

The entry, occupation, and use of another’s property without the consent of the owner or where the owner took no action to evict the adverse possessor. May lead to loss of legal title if the adverse possessor fulfills certain requirements.

Answer 40

Adverse Posession:

Question 41

A legal restraint to prevent a person from claiming a right or interest that is inconsistent with the person’s previous statements or acts. An estoppel certificate documents the party’s initial position or act, which cannot be contradicted later.

Answer 41

Estoppel:

Question 42

Public records of real property documenting the history of ownership, claims, ownership, conveyances, legal descriptions, and surveys.

Answer 42

Title Record:

Question 43

Successive property owners of record dating back to the original grant of title from the state to a private party.

Answer 43

Chain of Title:

Question 44

A written, chronological record of the title records affecting rights and interests in a parcel of real property.

Answer 44

Abstract of Title:

Question 45

A title recording system that registers title to property, as well as liens and encumbrances, on a title certificate. The certificate is the title and reflects everything there is to be known about the condition of the title.

Answer 45

Torrens System:

Question 46

Actual or constructive notice of real property ownership, including opinion of title, certificate of title, and title insurance.

Answer 46

Title Evidence:

Question 47

A document expressing the opinion of a title officer or attorney that a property seller is in fact the owner of good title based on a review of title records.

Answer 47

Title Certificate: