Title Assurance Flashcards
Ways to tell if you have good title
1) Covenants of title - seller promises good title
2) Recording system - go do a title history search at public records office!
- Indexes: grantor-grantee index or tract index
- What recording does: can protect buyers from adverse claims
- Recording has nothing to do w/ validity. A good deed is a good deed even if not recorded. And bad deed won’t be made good by recording
3) Title insurance
If adverse claim exists (same property is sold twice), what to do?
1) Common law analysis is the answer, UNLESS a recording acts steps in
CL answer: first buyer owns - “first in time, first in right”
* Once you sell once, you have no title left to sell
2) Recording acts - if exists will override common law answer
- Race statute
- Notice statute
- Race notice statute
Recording acts - race statute
First to record deed wins!
Recording acts - notice statute
Last to take as a BFP wins!
*BFP had NO notice of adverse claims
If took w/ notice - use CL rule
Can get notice in three ways:
1) Actual notice - actually of adverse claim
2) Constructive notice - there was adverse claim recording on the books when you bought it
3) Inquiry notice - something about the situation should have made you look more into it
Recording acts - Race notice statute
First to record AND took as BFP wins
Basically, you
1) Had no notice when you took property title, and
2) You recorded instrument before adverse claim was recorded
If both not met - use CL rule
Shelter Principle
A grantee who has received an interest in property from BFP will also be protected as a BFP
Title insurance
Bring in 3rd party that will assure buyer that he has good title
* TI protects buyer against damages from title defect
Registration
Dying out practice that’s alternative to the recording system.
Public official issues certificate that one owns good title to property
