Title Records

Question 1

Public records

Answer 1

Are open to anyone interested in a property. Will reveal documents, claims, and other details such as liens or encumbrances. Deeds and mortgages.
Records regarding taxes, judgement, private, and marriage.
Maintained by recorders of deeds, county clerks, county treasurers, city clerks, collectors, and clerks of courts.

Question 2

Recording

Answer 2

The act of placing documents in public records. Rules are matter of state law. All recording acts provide any written document that affects estate, right, title, or interest in land. Give legal priority to those interests recorded first “first in time, first in right” exceptions such as liens for property tax, special assessments, and delinquent amounts owed to IRS.
To be eligible for recording, document must be drawn and executed according to state law.

Question 3

Notice

Answer 3

Giving notice to ensure that the existence of the interest is made available to public. 2 basic types.

Question 4

Constructive notice

Answer 4

The legal presumption that info has been obtained by an individual through due diligence. A document placed in the public record serves as notice to the world of an individuals right or interest in the property. Physical possession serves as constructive notice. The info is readily available to the world.

Question 5

Actual notice

Answer 5

Not only is the info available but also someone is actually aware of it.

Question 6

Priority

Answer 6

Refers to the order of when documents or liens were recorded.

Question 7

Unrecorded documents

Answer 7

Certain types of liens are not recorded. Real estate taxes and special assessments are liens that are not usually recorded until after the taxes or assessments are past due. Inheritance taxes and franchise taxes are statutory liens and are placed against RE upon time if death or by the time the franchise taxes become a lien.
Notice just be gained from sources other than recorders office.

Question 8

Chain of title

Answer 8

The record of a property’s ownership. Beginning with earliest owner, title passes to many individuals. Should be able to track from first to last and last to first.
If ownership cannot be traced through an unbroken chain, a gap or cloud on title is said to exist. In such case it’s necessary to establish ownership in court act called ACTION TO QUIET TITLE.

Question 9

Title search

Answer 9

An examination of the public records to determine whether any defects exist in the chain of title.

Question 10

Marketable title act

Answer 10

The time beyond which the title must be searched can be limited in states that have adopted this.

Question 11

Abstract of title

Answer 11

A summary report of what the title search found in the public records. The person who prepares this is called an ABSTRACTOR or attorney. It includes all recorded liens and encumbrances and lists records searched but does not indicate forgeries and interests that are unrecorded or could be discovered by property inspection.

Question 12

Marketable title

Answer 12

Under the terms of the REPC, the seller is required to deliver to the buyer marketable title to the property. That is, title that acceptable to a responsibly prudent person and which will not subject the buyer to litigation.
To be marketable:
-disclose no serious defects and not depend on doubtful questions of law or fact to prove its validity
-not expose a purchaser to the hazard of litigation of threaten the quiet enjoyment of the property
-convince a reasonably well informed and prudent purchaser, acting on business principles and with knowledge of the facts and their legal significance that the purchaser could sell or mortgage the property at a later time.
Title that does not meet these requirements can still be transfers, it’s contains defects that may limit or restrict ownership.
Questions of marketable title must be raised before acceptance of deed.

Question 13

Proof of ownership

Answer 13

Is evidence that title is marketable. A deed by itself is not considered sufficient evidence of ownership.

Question 14

Certificate of title

Answer 14

A statement of opinion of the titles status on the date the certificate is issued. THIS IS NOT A GUARANTEE OF OWNERSHIP. It certifies the condition of the title based on an examination of public records. May be prepared by title company, abstractor, or attorney. This does not protect against hidden defects.
An abstract and attorneys opinion of title are used in some areas as evidence of title.

Question 15

Title Insurance

Answer 15

A contract under which the policy holder is protected from losses arising from defects in the title.
Policy includes
-name if insured party
-legal description of the real estate
-the estate or interest covered
-conditions and stipulations under which policy is issued
-a schedule of all exemptions including encumbrances and defects found in public records and any known unrecorded defects.
Maximum loss company is liable for cannot exceed the face amount of policy.

Question 16

Subrogation

Answer 16

When a title company makes a payment to settle a claim covered by a policy the company generally acquires the right to any remedy or damages available to the insured.

Question 17

Standard Coverage

Answer 17

Defects found in public records
Forged documents
Incompetent grantors
Incorrect marital statements 
Improperly delivered deeds

Question 18

Extended coverage (as provided by an American Land Title Association policy)

Answer 18

Standard coverage plus defects discoverable through the following

• property inspection including unrecorded rights of persons in possession
• examination of survey
• unrecorded liens not known by policyholder

Question 19

Not covered in title insurance

Answer 19

Defects and liens listed in policy
Defects known to buyer
Changed in land use brought about by zoning ordinances

Exclusions including zoning ordinances, restrictive covenants, easements, certain water rights, and current taxes and special assessments.

Question 20

Types of policies

Answer 20

An owners policy for benefit of owner/heirs/devisees and is issued for purchase price.

Lenders policy (mortgage policy) is issued for benefit of lender and the amount of the loan will determine coverage.

Question 21

Torrents systems

Answer 21

Legal registration system used to verify ownership of real estate.

Question 22

To serve as constructive notice…

Answer 22

And provide priority over subsequent documents, a written document that affects an estate, right, title, or interest in land must be drafted and executed according to state law (recording acts) and must be recorded in the public records that are maintained by the designated official, such as the recorded of deeds etc in the county in which the property is located.