Topic 5 Flashcards
Real Estate Title Transfer
Involves the intentional conveyance of title, by sale or gift, from one owner to another by means of a deed or a patent.
voluntary transfer or voluntary alienation
Three types of voluntary transfer…
- ) Public grant
- ) Private grant
- ) Public dedication
Transfers legal title to land from the gov’t to a private party. Seldom used today.
Public grant
A formal document conveying a part of the public domain to a private citizen
Patent
transfers title to real property from one private person to another. Most common type of voluntary transfer. Title is generally conveyed by deed.
Private grant
Party conveying title
Grantor
*LA, Vendor
Party receiving title
Grantee
*LA Vendee
Voluntary conveyance of title as a gift from a private owner to the gov’t
Public dedication
A written instrument by which title to real property is formally transferred from one party to another. Must be properly executed to be valid. Must be conveyed to and accepted by the party to whom title is being transferred.
Deed
To be valid, a deed must meet the following requirements…
- ) Must be in WRITING
- ) Grantor must be IDENTIFIED by NAME, MARITAL STATUS, and must be COMPETENT, LEGALLY OF AGE, and CAPABLE OF CONVEYING the ownership rights being transferred.
- ) Grantee must be IDENTIFIED by NAME, MARITAL STATUS, and must be CAPABLE OF HOLDING TITLE to the property conveyed. HE NEED NOT BE MENTALLY COMPETENT OR LEGALLY OF AGE TO ACQUIRE TITLE.
- ) A STATEMENT of some consideration was given, as money, love or affection must be included, although the amount need not be specified.
* In LA, the amount MUST be specified in order to avoid a suit of lesion beyond moiety, b/c of forced heirship laws* - ) Property being conveyed must be accurately DESCRIBED
- ) Specific WORDS OF CONVEYANCE stating the grantor’s intention to convey title, and the type of property interest being conveyed, that is fee simple estate, life estate, etc. must be included.
- ) Any RESTRICTIONS must be stated
- ) TITLE must be acquired in the PRESENT, not the future.
- ) Grantor must SIGN
- ) There myst be DELIVERY AND ACCEPTANCE of the deed.
Recordation of the deed isn’t required, but is necessary to give notice to 3rd parties.
In LA, there’s no deed actually given, but the conveyance is recorded at the Court House
Types of deeds…
- ) Warranty Deed
- ) Quitclaim Deed
- ) Bargain and Sale Deed
- ) Specialty Deeds
Contains covenants, or promises, of warranty. Guarantees that the title it conveys is good.
Warranty Deed
offers a more comprehensive guarantee of title than any other type of deed. The grantor certifies that the title he is conveying is free of defects which may have arisen either before or during the time he owned the property. This is the best type of deed because it contains all covenants warranting back through all previous owners. Can not absolutely guarantee good title. It can not remedy actual flaws of title, unrecorded title claims, undisclosed encumbrances, or fraud, but compensation can be won for breach of covenant.
General Warranty Deed
*LA - Sale with warranty
The following five covenants are included in a general warranty deed:
- ) Covenant of seizen
- ) Covenant against encumbrances
- ) Covenant of further assurance
- ) Covenant of quiet enjoyment
- ) Covenant of warranty forever
assures that the grantor fully possesses or is “seized with” the title he is conveying.
Covenant of seizen
assures the grantee that the property is free from liens and encumbrances, other than those specified in the deed.
Covenant against encumbrances
promises that the grantor will defend the grantee’s title against all claims which may arise from the period prior to transfer.
Covenant of further assurance
protects the grantee’s rights to physical possession of the property without being disturbed by other parties making claims against his rights.
Covenant of quiet enjoyment
underwrites each of the other four covenants and guarantees absolutely the grantees ownership rights and title. The grantor agrees to compensate the grantee for losses suffered from the breach of any of the deed’s covenants.
Covenant of warranty forever
In LA, instead of these warranties, the grantor gives…
delivery
peaceful possession
warranty against latent defects
This deed contains only one covenant. In this covenant, the grantor guarantees the condition of title only for the time he actually owned the property. He claims no responsibility for title claims arising from past periods of ownership, or for encumbrances other than those he himself has incurred and specifically listed in the deed.
Special Warranty Deed
deed makes no promises at all. The grantor simply relinquishes any claim to title which he may or may not have had. Conveys whatever title the grantor possesses, whether it is a clear, unimpaired title, a defective title claim or no title interest at all. Used frequently for removing clouds on title.
Quitclaim Deed
*LA - Sale without warranty
a lingering, often vague or uncertain claim or encumbrance that impairs an owner’s title
A cloud on title
guarantees more than the quitclaim, but not as much as a warranty deed. It conveys title without explicit guarantees, but does imply that title is good. There is an assurance that the grantor does in fact, possess the rights which he is conveying.
Bargain and sale deed
a special type of bargain and sale deed which includes a covenant assuring the grantee that the grantor has done nothing to encumber the property during the time he has owned it. This covenant, in effect, turns the deed into a special warranty deed.
Bargain and Sale Deed with Covenant
a variety of deeds used for special purposes.
Specialty Deeds
used to convey property of an intestate deceased.
administrator’s deed
used to convey a private owner’s road, street or alley rights to a public governmental body.
cession deed
used for placing property in a land trust.
deed in trust
used for conveying title to a trustee as security for a loan.
deed of trust
conveys property out of trust.
trustee’s deed
conveys property of a testate deceased.
executor’s deed
conveys property given as a gift.
gift deed
conveys property of minors or incompetents.
guardian’s deed
conveys severed interests of co-owned property resulting from a court ordered partition.
partition deed
conveys property sold by court order to satisfy a debt.
sheriff’s deed
used by a trustee to return title to a trustor.
reconveyance deed
identifies the grantor and grantee, may include their addresses.
vesting clause
expresses the grantor’s intention to convey, grant, give, sell or release his real property interest to the grantee, using specific WORDS OF CONVEYANCE.
Granting clause
specifies the kind of estate being transferred, that is, fee simple, life, etc., and also lists any covenants, warrants, or promises. Deed restrictions and encumbrances are usually listed immediately following this clause.
Habendum Clause
Habendum comes from the Latin, habendum et tenendum, meaning “to have and to hold”.
includes the signature of the grantor, the date of signing, the signatures of witnesses, and a seal, if required. In transferring co-owned property, all co-owners must sign. In transferring dower or curtesy rights, the grantor’s spouse must sign.
Execution clause
Follows the signatures of grantor and witnesses. A formal declaration before an authorized person, usually a public notary, made by the person signing the deed, that he is the grantor and that he has signed the deed of his own free will.
Acknowledgment
Title to real property may be transferred without the owner’s consent. Most are effected through the action of the law, through government bodies or the courts.
Involuntary Transfer or involuntary alienation
Most common ways for involuntary transfer…
- ) Eminent Domain
- ) Partition Sale
- ) Escheat
- ) Judicial Action
- ) Adverse Possession
the acquisition of private property, by government, for public use. Lands thus acquired must be used for specific public purposes and the owners affected must be justly compensated for their loss of title.
Eminent Domain
The government’s right of eminent domain is expressed through court action known as…
condemnation
*LA - expropriation
Joint tenancy and tenancy in common can be dissolved this way. Only one of the co-owners need initiate such a suit. The tenancy can be dissolved this way whether all owners agree to it or not. The outcome of the suit is usually a court ordered sale of the property. The proceeds of the sale are divided proportionately among the co-tenants.
Partition sale
When an owner dies without leaving a will and without heirs, his property title reverts to the state. Since property can not be allowed to remain ownerless, the state must assume ownership where there is not legal claim to title.
Escheat
This involves transfer by foreclosure, attachment and tax sale. This occurs when an owner defaults on a debt and his creditors file suit. If a judgment is entered against the owner, his property will be sold, and the proceeds of sale used to pay off the debt. The property may also be sold at a tax sale for failure to pay property taxes.
Judicial Action
This is the acquisition of title to property by possession of the property for a statutory number of years. In order to claim title, the occupancy and possession of the property must be continuous, open, hostile, exclusive and notorious. The adverse possessor must occupy the property he claims continuously, for a period of from five to thirty years, as determined by state law. Payment of property taxes by the adverse claimant may also be a necessary condition.
Adverse Possession
*LA - acquisitive prescription. If a claimant occupies a parcel of property in good faith, it may become his in ten years; if in bad faith, it takes thirty years.
If two or more adverse claimants occupy the same property in succession, the years of their occupancy may be combined for the benefit of the most recent claimant. This adding together of years to meet the statutory requirements of possession is known as…
tacking
Title to real property may be…
transferred by will
written instrument by which a person arranges for the conveyance of his property to take effect after his death. A person who dies leaving this is said to have died testate.
will
one who inherits property in a will.
A legatee
Types of wills…
- ) statutory will
- ) holographic will
- ) nuncupative will
- ) mystic will
a formally prepared will, usually by an attorney, which is witnessed and signed.
statutory will
*LA - notarial will
a will completed entirely in the testator’s own handwriting, dated and signed by him, but not witnessed by any other person. Some states do not recognize. The testator must be legally competent to be binding.
holographic will
*LA - olographic will
a will made orally by a testator who is near death. Only personal property may be transferred by this type of will. It must be witnessed, and the witness must commit the testator’s words to writing. The testator must be legally competent to be binding.
nuncupative will
must be in writing, signed by the testator, sealed, and notarized with three witnesses.
mystic will
Effective July 1, 1999, Louisiana recognizes only two forms of wills…
holographic and notarial
an addition to an existing will by which changes in the provisions of the will are made.
codicil
When a testator dies, his will is admitted to ________. This is a court proceeding designed to establish the validity and authenticity of the will, and allow the legatees, creditors, and other interested parties to claim their shares of the estate.
probate
*LA - succession
An _______ is usually appointed in the will to carry out the instructions of the will. If not, the court will appoint an ______ for that purpose.
executor, or executrix, if female
administrator
In LA, real property transferred by will is known as the ______. The person to whom such real property is transferred is known as the ______. An ______ is used to convey title to real property to the devisee).
devise
devisee
executor’s deed
a wife’s interest in her husband’s estate at his death.
Dower
the husband’s interest in his wife’s estate.
Curtesy
When a person dies without leaving a valid will, he dies ________. State law determines how his property will be divided.
intestate
An ______ is named by the court to administer an intestate succession.
administrator
Laws of succession vary from state to state, but typically, they will satisfy the interest of heirs in the following order:
surviving spouses and children
deceased’s grandchildren
parents
siblings
other more distant relations
In states recognizing community property as a form of husband and wife co-ownership, the entire estate is transferred to…
the surviving spouse
In most other states, the deceased’s estate is usually divided among …
the surviving spouse and children
In LA, the law that parents, when making a will, must leave a certain portion of their estate to their children. This is called the forced portion. The amount of the estate that is forced depends upon the number of children.
If there are no children, there is no forced portion.
If there is only one child, 1/4 of the estate is the forced portion.
If there are two or more children, 1/2 of the estate is the forced portion.
forced heirship
In LA, there are twelve ways in which a child may be disinherited in Louisiana, including….
- ) conviction of murder or attempted murder of one or both parents
- ) marrying prior to the age of majority without parental consent
- ) not attempting to raise ransom money if a parent is kidnapped.
In LA, the children are called…
naked owners
In LA, upon the death of a parent, the children are given the right to sell or mortgage the property and the right to the proceeds from the sale
abusus
In LA, the surviving spouse is given the right of enjoying the use of the property and the income produced by the property.
usufruct
In LA, the portion of the estate that is not forced
disposable portion
In LA, a gift in a will
donation mortis causa
involves the acquisition of real property interests through natural or artificial causes, or acts of God. Although this is a type of involuntary transfer, it is treated separately because no deeds or other legal instruments are involved.
transfer by accession
Principal forms of transfer by accession are…
- ) Accretion
- ) Reliction
- ) Erosion
- ) Attachment
the gradual, physical increase in the size of a property as the result of some natural process, usually the action of water.
Accretion
The action of the sea or a river in forming new land by deposition
alluvion
the gradual exposure of land behind a receding waterline. When the water level of a lake, river, or stream drops, the land exposed becomes a part of the adjoining property.
Reliction
the loss of property by wearing away of soil by wind, water, etc.
Erosion
Real property interests may be gained, lost or transferred by artificial means. Improvements on real property, for example, fixtures, may become permanent property additions. Even improvements made in error, a garage built on the wrong lot, for example, can, in some cases, become part of the property to which they are attached, if they were made without the owner’s consent.
Attachment
Ownership of real property is vested in the _____.
title
If a title is clouded by defects, such defects will be passed along to the next person who acquired the property…
unless the title is cleared
All documents that create, transfer or encumber a property must be recorded in the public records, to protect the interest of the grantee and insure future marketability of title. Public recording involves the registration or enrollment of an instrument - deed, mortgage, etc. - with some local government official, usually the county clerk or county recorder.
constructive notice
In order to establish that a document which is to be recorded has been willingly signed by its true executor, proof of validity is required…
- ) Acknowledgement
- ) Verification
- ) Affidavit
- ) Affirmation
a statement that the person executing a document has done so of his own free will, and that he is in fact the person whose signature appears on the document.
Acknowledgement
an oath confirming the truth of a document’s contents.
Verification
a written confirmation of the truth of a set of circumstances.
Affidavit
a declaration made by a person prohibited from giving an oath by his religious beliefs.
Affirmation
first hand information regarding a property which is known by a single interested party, or which should be known by this party.
involves the notice a person gives through his physical occupation of a property, or by his public announcement of his interest in a property.
actual notice
Method is based on an attorney’s examination of the history of the title
The Attorney’s Opinion
a brief summary of all recorded instruments which have affected the title, including records of taxes, special assessments, judgments, mortgages and trust deeds.
a condensed version of the information available in the public records about a particular property. It is a complete chronological, historical summary of all documents that affect the title to a property.
Abstract Title
a continuous linking of owners stretching back, ideally, to the time when the land’s first owner received it by patent or grant from the government.
chain of title
After the abstract is done, it is then sent to an attorney for legal examination of the title evidence. The attorney gives an opinion as to who the owner is and as to anyone else with a legitimate interest in the property. The attorney then gives a ________, which is his opinion, written, signed, and attached to the abstract. Gives a professional evaluation of the current condition of the title, but offers no guarantee of the title’s soundness
certificate of title
A ______ may be filed which is a legal action in which the court is asked to resolve any possible clouds on the title.
suit to quiet title
began as protection for attorneys for any errors they might make in abstracts. It is now available to anyone who wishes to buy it. It is used to protect the owner and lender against possible claims by third parties. It offers financial protection if the title proves unsound.
Protects only against the past, not the future. Title policies are taken out with a one time, lump sum payment, and are not transferable.
title insurance
A title insurance company determines whether the title is insurable based on a review of the public records. Once the title company makes a payment to settle a claim, the company generally acquires the right to any remedy or damages available to the insured. This right is called _______.
subrogation
protects the lender who takes the property as collateral for a loan. It protects only the amount owed on the loan, and the insured amount is reduced as the loan is paid off.
Mortgagee’s or Lender’s Policy
is good for the full amount of coverage as stated on the policy and for as long as the owner or his heirs have an interest in the property.
Mortgagor’s or Borrower’s Policy
normally insures the title as it is known from the public records, and against such hidden defects as forged documents, conveyances by incompetent grantors, incorrect marital statements, and improperly delivered deeds.
A standard coverage policy
includes the protections of a standard policy plus additional protections against defects such as rights of parties in possession, examination of a survey and certain unrecorded liens.
Extended coverage
The right of the title company to any remedy or damages available to the insured, when the title company has made a payment to settle a claim covered by a policy.
Subrogation
unauthorized intrusion of a building or other improvement onto the land of another person. The owner of the land that is being encroached upon has the right to force the owner of the encroachment to remove it. Failure to do so may injure his title.
enroachments
A survey identifies an enroachment.
unrecorded easements and information based on incorrect and inaccurate surveys.
technical errors
such as any omission or error in public records, such as misfiling, etc.
Hidden defects in public records
are other defects which can present problems in a title.
Uncancelled mortgages and prior judgments
A title defect, or cloud on a title may be removed in several ways…
- ) paying unpaid taxes.
- ) filing a Suit to Quiet Title.
- ) Use of the Quitclaim Deed, whereby a third party releases any claim to the title.
gives an owner the right to sell, will, lease, or give away his property rights.
The right of disposition
