Transfer Of Title Pt 2

Question 1

Grantee’s right to recovery

Answer 1

A guarantee that the grantee will receive reimbursement due to breach of the warranty.
Includes encumberances

Question 2

Special warranty deed

Answer 2

The warranty is limited to the owners time of possession of the property rather than unlimited in a general warranty deed

Question 3

Quitclaim deed

Answer 3

Contains no warranties whatsoever but is simply a deed of release
May be used to clear a cloud on a title

Question 4

Cloud on a title

Answer 4

Occurs when someone has possible claim on the title

Question 5

Bargain and sale deed

Answer 5

Not used in NC

Similar to a quitclaim or non warranty deed

Question 6

Trustee’s deed

Answer 6

Used by the trustee to hold title until it is conveyed to the proper person (in the case of a trust)

Question 7

Sheriff’s deed

Answer 7

Rare in NC

Conveyed by the sheriff when it is necessary to involve law enforcement in a transfer of deed situation

Question 8

Deed of gift

Answer 8

Can be conveyed with or without warranty (general or quitclaim)
Warranties cannot be enforced against the grantor because of it being a gift
This type of deed cannot be used to satisfy creditors rights
Must be recorded within two years to remain valid

Question 9

Excise tax

Answer 9

Revenue or transfer stamp
To be paid by the seller
$1 per every $500 of total price of sale
(Ie 74000/500 = $148 tax)

Question 10

County transfer tax

Answer 10

A few counties in NC impose a tax for transferring a title. The REALTOR association doesn’t like this because they try to make home ownership more affordable

Question 11

Covenants of title in deeds

Answer 11

Assurance for the grantee that if the grantor breaches covenant that they can be sued

Question 12

Title examination

Answer 12

Done by an attorney
Attorney looks for flaws in the title as far back as the law notes
Only concerned with public record
30 years (marketable title act)

Question 13

Title insurance

Answer 13

Becomes active when policy is enabled
Protects the purchaser or mortgage against loss due to a defect in title or other things listed in the policy
One time premium and last as long as the buyer or his heirs have interest in the property

Question 14

Title insurance rate

Answer 14

$2 per every $1,000
Until 100,000 then $1.50 for every $1,000
(Ie 200,000 payment = $350 insurance premium)

Question 15

Owners policy

Answer 15

For the protection of the owner and is written for the amount the owner paid for the property
Remains in effect for the duration of ownership as well as to benefit his or her heirs

Question 16

Mortgagees policy

Answer 16

Protects lender against any defects in the title
Diminishing liability as the house is paid off
Generally offered in package with the owners policy and often cost little to no extra cost

Question 17

Leasehold policy

Answer 17

Protects lessee or mortgagee against defects in title

Issued when mortgagor has pledged a leasehold interest instead of fee simple title as security for the mortgage

Question 18

Title recordation

Answer 18

Not required in NC
But should be considered essential by all people
Constructive notice is established

Question 19

The conner act

Answer 19

Provides that certain documents are not valid against third parties until recorded creating need for security because NC is a pure race state
Most written documents need to be recorded in order to protect against this

Question 20

Pure race state

Answer 20

The first party to record ownership shall be recognized as rightful owner or the higher priority lien

Question 21

DREAMOIL

Answer 21

Deeds, Restrictive covenants, Easements, Assignments, Mortgages, Options, Installment land contracts, and Leases

Question 22

Marketable title act

Answer 22

Aims to extinguish old defects in title by providing that if a chain of title can be established for 30 years without blemish then claims outside the chain would be dissolved.

Question 23

The torrens system

Answer 23

Similar to car title registration
When ownership is transferred the old deed must be destroyed and replaced with a new one
Doesn’t allow property to be taken by adverse possession
Lengthy and costly

Question 24

Action to quiet title

Answer 24

The due process of adverse possession.

No marketable title unless court rules in favor of the lessee