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TN Title Certification > TN Title Certification > Flashcards

TN Title Certification Flashcards

1
Q

What is the best definition of insurance?

A

The transfer of risk

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2
Q

What is a voluntary lien?

A

Any lien that is voluntarily taken against the property, ex. Deeds of trusts and mortgages are the big ones. Mechanic’s liens are not voluntary.

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3
Q

What is a lien?

A

First, any lien is an encumbrance, but not all encumbrances are liens. A lien represents a monetary claim levied against property to secure payment. The settlement of an obligation from the property owner.

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4
Q

What is an encumbrance?

A

It is a much broader term than a lien. It refers to any sort of claim against a property.

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5
Q

Which is an encumbrance NOT a lien?

A

Covenants, Conditions and Restrictions (I picked this (but I don’t know if this is right), Mortgage, Deed of trust, and Levy of execution

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6
Q

A man that owns property with one of the sides being a navigable stream owns what part of the stream?

A

Because the question specifies that it is navigable it is to the edge of the water (low water mark). If the water was non-navigable property owners can own all or share the land underwater.

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7
Q

What are riparian rights?

A

The rights of the owners of lands on the banks of flowing water that allow the owner to build a dock, moor boats, and use the water for other non commercial purposes. In contrast, littoral rights deal with any property abutting an ocean, lake or sea rather than a river or stream. Littoral rights are usually concerned with the use and enjoyment of the shore. (Think littering on the beach)

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8
Q

Can water boundary move over time?

A

They can be altered on navigable bodies of water by gradual processes resulting from erosion and accretion however they cannot be changed by sudden, visible, violent action of avulsion.

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9
Q

What is required on a deed of conveyance?

A

Conveyance statement or sellers (grantor) signature. Can’t convey if either are not included (I think the answers on my test were buyers signature, lien holder, conveyance wording or insurance company- I picked conveyance wording)

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10
Q

What is included in Schedule A?

A

Schedule A contains the description of the land being conveyed, it does not contain any terms

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11
Q

What is the part of an owners policy that details what an insured will be responsible for in case of loss?

A

Schedule B, Exceptions. Exclusions

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12
Q

What is a mechanic’s lien?

A

A lien against work done on the property often by a contractor, most insurers require this risk to be excepted even with no evidence of lien in public records because they are hard to track

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13
Q

When can a mechanics lien be recorded?

A

Must be recorded 90 days from completion of construction or will not be valid

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14
Q

What do you call the ability to use and enjoy an estate until death and issuance of deed of conveyance?

A

Life estate, when someone has the right to live in property until they die, but when they do not own the actual property. Most of the time you can’t sell property if there is a life estate unless the person with life estate also agrees to sell.

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15
Q

Who sets the rates for title insurance?

A

The Commissioner

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16
Q

Acting on/forcing of a mortgage on a home is called what?

A

Foreclosure

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17
Q

What does a typical owners insurance policy exclude?

A

Liens due to insureds negligence on the mortgage

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18
Q

What is simultaneous issue?

A

Lenders and owners policy issued at the same time in order to cover everyone

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19
Q

For an appointment request how many days does an insurer have to submit a contract of appointment to the commissioner?

A

Maximum of 15 days

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20
Q

How long is a producer license good for until it must be renewed?

A

2 years

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21
Q

In order to renew your license how much continuing education is required?

A

24 hours of CE, including 3 hours of ethics every 2 years

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22
Q

What is replacement value?

A

The cost to replace property at today’s cost

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23
Q

What is Actual cash value?

A

ACV is the replacement value minus depreciation

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24
Q

Conveyance is what?

A

The transfer of ownership of property, which includes obligations and responsibilities tied to property

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25
Q

What is the difference between vacant, occupied, and non-occupied property?

A

Vacant has no contents or people, unoccupied may have contents, but no people. Neither lack of occupancy or vacancy of a structure affects title coverage

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26
Q

What is a declarations page in a general insurance policy?

A

It includes common info such as insureds name and address, description of the property insured, amounts of coverage and policy period and premium. IN TITLE INSURANCE THIS INFO IS GENERALLY FOUND ON SCHEDULE A. (PREMIUM IS THE ONE THING GENERALLY OMITTED FROM SCHEDULE A FOR TITLE INSURANCE)

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27
Q

What is the passing of title called in a deed vs. the passing of title in a will?

A

In a deed the passing of title is called “conveyance” while in a will the passing of title is called a “devise”

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28
Q

When you die without a will it is called?

A

Intestate

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29
Q

What does TN law say about common law marriage and divorce?

A

TN accepts common law marriages from other states. They also accept marriage as stated by a couple, however they do not accept divorce only from a statement. There must be proof.

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30
Q

What is a warranty deed?- This one was the question on my test and the answer was Warranty Deed

A

A warranty with no known exceptions/warranties; meaning I hold the title

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31
Q

What is a special warranty deed?

A

A warranty with exceptions, but nothing to risk title

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32
Q

What is a quit claim deed?

A

A quit claim deed has no guarantees, the property is still transferred, but with potential risk of me not owning title

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33
Q

What is the order of intestate estate dispersal?

A
  1. Spouse 2. Children 3. Parents 4. Siblings 5. Cousins
34
Q

What is an easement?

A

An interest in land in the possession of another which entitles the owner of the easement to a limited use or enjoyment of the land over which the easement exists. Note that some that has an easement does not have title to the land, just the right to use the easement

35
Q

Can you build over or force an easement?

A

You can build over an easement, but you shouldn’t in case it is needed, your property will be torn down to get to the easement. You can force an easement as well if there is no direct access.

36
Q

The land that an easement goes through to service another plot of land is called what?

A

Servient estate

37
Q

The land that an easement services is called what?

A

Dominant estate

38
Q

What is an easement that is a mere personal right to use another’s land, for hunting rights for example?

A

Easement in gross

39
Q

What is an enhanced policy?

A

Enhanced policies provide much broader coverage at a higher cost. Most widespread use of enhanced coverage occurs in owners policies. Title professionals must make sure that those purchasing title policies are adequately advised of the types of coverage that can be secured at each price.

40
Q

Owners policies can only be issued to who?

A

Natural person, which includes a human being, not any commercial or legal organization. Natural person also includes a trustee of a trust even if the trustee is not a human being.

41
Q

What is considered the policy date or effective date?

A

Date of recording in the register of deeds office

42
Q

What is the maturity dates of a deed of trust?

A

Deadline is 10 years after maturity if the recorded deed of trust recites a maturity date and 60 years after recording if it does not. Most lenders typically do not recite maturity dates so usually it is 60 years after the deed was recorded.

43
Q

When an amount of arbitration is below $2M who has to request?

A

Only one side has to request, when the amount is over $2M both parties must agree to arbitration

44
Q

What are some examples of proof that you should have title to a property?

A

A deed

45
Q

What is common law adverse possession?

A

Common law established that one who claims to have been in adverse possession of property must provide clear and convincing factual proof of the necessary elements of such possession. The possession must be open, continuous, exclusive, adverse (hostile), and notorious for 20 years. (To remember each element think OCEAN)

46
Q

What does ‘Statutory Adverse’ refer to?

A

True owners shall be barred from filing any action to dispossess a party which has adversely possessed the land unless brought within seven years after adverse possession begins. 7 years of possession itself does not mean title is transferred, just makes it harder to fight against.

47
Q

With 7 years of adverse possession, what else does any person looking for absolute title need?

A

30 years recorded color of title is vested with absolute title.

48
Q

What does having title confer upon you?

A

The right to occupy, use, enjoy and dispose of the land

49
Q

Is title a guarantee of the accuracy of the abstract or title examination upon which the policy is based?

A

No, rather it is a contract of indemnity against loss resulting from the status of title to the insured property not being as insured by the policy. Recognizing that title defects may arise, title insurance policies also include a qualified promise to defend the title of the insured.

50
Q

Are matters that occur subsequent to (or after) the effective date of the policy covered by title coverage?

A

In most cases they are not, they are very few exceptions with extended policies)

51
Q

If a commissioner denies application for license how many days does he have to state the denial in writing?

A

30 days

52
Q

What are the fees associated with insurance violations?

A

Payment of $1,000 per violation (not to exceed $100,000) unless violation was knowingly committed, in which case it is not be more than $25,000 per violation not to exceed $250,000.

53
Q

In TN who must be licensed in order to issue policies?

A

BOTH individual insurance producers and the company they work for must be licensed

54
Q

Where is the amount of insurance set out in a title policy?

A

Schedule A, but can be significantly modified by paragraphs in the conditions section

55
Q

What defects are indeed covered subsequent (or after) the policy date are covered?

A

Defects which arise subsequent to the policy date are not covered, however a defect which is “discovered” post policy, but was in existence prior to the policy date will be covered

56
Q

What is an example of an exclusion created or assumed by the claimant, not known to the company, not recorded, but known to the insured claimant?

A

Forged signature by one of the sellers which was known by the insured purchaser.

57
Q

Can you choose to settle certain claims in lieu of curing the alleged title defects?

A

The insurer has certain options to settle claims in lieu of curing the alleged title defects, but the insured does not have the option of directing insurer to correct defects

58
Q

What is the difference in subordination and subrogation?

A

the right of subrogation is the right to pursue someone else’s claim- third party. Subordination is a legal agreement which establishes one debt as ranking behind another debt in the priority for collecting repayment from a debtor.

59
Q

After foreclosure, where is the sale of foreclosure required to take place?

A

Under TN statutes there is no specific place required for the sale, however the notice of foreclosure must be published in the county where the sale is to take place.

60
Q

Which easement is not insurable under title insurance?

A

Easement in gross

61
Q

What is eminent domain?

A

The right of a state government to compel the sale of real or personal property, or to take private property for public use.

62
Q

What do title insurance policies have typically regarding eminent domain?

A

Typically insurance policies have standard exclusions against losses that are a result of eminent domain. The property owners compensation for any loss arising from such a taking is governed by the 5th amendment.

63
Q

What is included in a title insurance all-inclusive rate?

A

In all inclusive counties (which includes 6 largest population counties in TN), the “gross premium” is a single fee that includes all three components which include – 1. Search, 2. Examination and 3. Risk Assumption. The consumer will not be charged separately for the search and examination functions the title agent performs.

64
Q

Who can sell property of the bankruptcy estate?

A

Only a trustee or “Debtor in possession” may convey real property

65
Q

What is a “fee simple estate”?

A

The maximum ownership someone can have in an estate

66
Q

What is ownership called when property is acquired by individuals who are married at time of conveyance?

A

Their ownership is considered Tenancy by the entirety which includes right of survivorship. Upon a divorce, Tenancy by the entirety is destroyed and converted into tenancy in common with both parties owning ½ share of property.

67
Q

What is ownership considered when property is acquired by two or more individuals who are not married at time of conveyance?

A

Tenants in common, in which each owner has a certain designated share of the property. Unlike tenancy by entirety, upon death, ownership does not transfer.

68
Q

What is the difference between a PUD and townhome?

A

In a condominium townhome, all land is commonly owned and maintained. In a PUD you actually own the land that your townhome sits on.

69
Q

What is a probate proceeding conducted in a different state from the one the deceased resided is called?

A

Ancillary probate proceeding

70
Q

To record a conveyance of deed what do you need?

A

Acknowledgements

71
Q

How long after does an insurance producer have to do a bond?

A

You must file a $25k bond within 30 days

72
Q

Where do escrow funds go to be held?

A

Escrow fund is not an option –> title insurance agent’s corporate account

73
Q

Neutral third party

A

Arbitrator

74
Q

When an addition leans onto someone else’s property it’s called an…

A

Encroachment

75
Q

What is the minimum commitment required of a title agent?

A

Title agents are required to conduct a reasonable search and examination of the title preliminary to issuance of any policy

76
Q

What is the maximum license fee violation when your license has been revoked?

A

$2,500 was an option and so was $1000. But to me this is a knowing violation which should be an up to $25k fine so I picked $2500 b./c it was more than $1000
Question is indeed annoying. I marked $1,000 because it didn’t specify knowing violation, and in that case the maximum penalty would be $25,000 - SB

77
Q

When do you need to tell someone that there is an owner’s policy?

A

Before or at time of close

78
Q

If a loss occurs for a mechanics lien - what does the policy cover?

A

Cover it up to the policy amount

79
Q

What does indemnity mean?

A

Protect against a loss; bring insured back to same economic position prior to loss (no more, no less). Make Whole.

80
Q

How often are premiums paid?

A

Once

81
Q

The Point of Beginning should be:

A

Fixed, permanent, clearly identifiable

TN Title Certification (1 decks)

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