Unit 5

Question 1

Abstract of Title

Answer 1

The condensed history of a title to a particular parcel of real estate, consisting of a summary of the original grant and all subsequent conveyances and encumbrances affecting the property and a certification by the abstractor that the history is complete and accurate.

Question 2

Action of Quiet Title

Answer 2

A lawsuit brought in a court in order to establish a party’s title to real property and to “quiet” any challenges or claims to the title.

Question 3

Adverse Possession

Answer 3

The open, continuous, exclusive, adverse, notorious (OCEAN) possession of another’s land under a claim of title. Possession for a statutory peroid of 20 years in North Carolina may be a means of acquiring title.

Question 4

Alienation

Answer 4

The act of transferring property to another. Alienation may be voluntary, such as by gift or sale, or involntary, as though eminent domain or adverse possession.

Question 5

American Land Title Association (ALTA)

Answer 5

A title insurance policy that protects the interst in a collateral property of a mortgage lender that orginates a new real estate loan.

Question 6

Bargain and sale deed

Answer 6

A deed that carries with it no warranties against liens or other encumbrances but that does imply that the grantor has the right to convey title. The grantor may add warranties to the deed at his discretion.

Question 7

Chain of Title

Answer 7

The succession of title conveyances, from accepted starting point, whereby the present holder of real property derives title.

Question 8

Cloud on the title

Answer 8

Any document, claim, unreleased lien, or encumbrance that may impair the title to real property or make the title doubtful; ususally revealed by a title search and removed by either a quitclaim deed or suit of quiet title.

Question 9

Condemnation

Answer 9

A judicial or an administrative proceeding to exercise the power of eminet domain, through which a government agency takes private property for public use and justly compenstates the owner.

Question 10

Connor Act

Answer 10

A North Carolina law that reqiures many types of real estate documents to be recorded for protection against claims from third parties. These documents include deeds, mortgages, purchase contracts, installment land contracts, assignments, options, leases exceeding three years, easements, and restrictive covenants; a pure race statute.

Question 11

Constructive Notice

Answer 11

The notice given to the worls by recorded documents. All people are charged with knowledge of such documents and their contents, whether or noth they have actually examined them. Possession of property is also considered constructive notice that the person in possession has an interest in the property.

Question 12

Covenant

Answer 12

A written agreement between two or more parties in which a party or parties pledge to perform or not perform specified acts with regard to property; usually found in such real estate documents as deeds, mortgages, leases, and contracts for deed.

Question 13

Deed

Answer 13

A written instrument that, when executed and delivered, conveys title to or interest in real estate; evidence of title.

Question 14

Delivery and Acceptance

Answer 14

The actual delivery of a deed by a grantor and the actual or implied acceptance of the deed by the grantee; recordation of the deed is viewed as acceptance.

Question 15

Eminent Domain

Answer 15

The right of a government or municipal quasi-public body to acquire property for public use through a court action called condemnation, in which the court decides that the use is a public use and determines fair compensation to be paid to the owner.

Question 16

Escheat

Answer 16

The reversion of property to the state, as provided by state law, in cases where a decedent dies intestate without heirs capable of inheriting or when the property is abandoned.

Question 17

Excise Tax

Answer 17

Deed transfer tax paid by the seller and required to be noted on a deed by state law; the rate is $1 per $500 of sales price.

Question 18

General Warranty Deed

Answer 18

A deed in which the grantor fully warrants good clear title to the premises through four covenants in the deed. Used in most real estate deed transfers, a general warranty deed offers the greatest protection to the grantee of any deed.

Question 19

Grantee

Answer 19

A person who receives a conveyance of property from a grantor.

Question 20

Granting Clause

Answer 20

Words in a deed of conveyance that state the grantor’s intention to convey the property at the present time. This clause is generally worded as convey and warrant, grant, bragain and sell, or the like.

Question 21

Grantor

Answer 21

(1) The property owner that is transferring title to or an interest in real property to a grantee, (2) A borrower in a deed of trust loan trasaction; also alled trustor.

Question 22

Intestate

Answer 22

The condition of a property owner who dies without leaving a valid will. Title to the property will pass to the decedent’s heirs as provided in the state law of descent.

Question 23

Marketable Title

Answer 23

A good or clear title, reasonable free from the risk of litigation over possible defects.

Question 24

Marketable Title Act

Answer 24

The act is designed to eliminate obsolete defects in a chain of title. If a chain of title can be traced back for 30 years without a problem, it becomes a marketable title.

Question 25

North Carolina Intestate Succession Act

Answer 25

The state law of descent that dictates distribution of the real and personal property of the deceased that died without a will (intestate).

Question 26

Quitclaim Deed

Answer 26

A conveyance by which the grantor transfers interst in the real estate, if any, without warranties or obligations; frequently used to remove clouds on the title.

Question 27

Recording

Answer 27

The act of entering or recording documents into the public record at the recorder’s office established in each county. Until recorded, a deed or mortgage ordinarily is not effective against third parties, such as subsequent purchasers or mortgagees.

Question 28

Special Warranty Deed

Answer 28

A deed in which the grantor only warrants, or guarantees, the title against defects arising during the period of the grantor’s tenure and ownership of the property and not against defects existing before that time, generally using the language by, through, or under the grantor buy not otherwise.

Question 29

Title

Answer 29

(1) the right to or ownership of land. (2) The evidence of ownership of land.

Question 30

Title Insurance

Answer 30

A policy insuring the owner and/or mortgagee against loss by reason of defects in the title to a parcel of real estate, other than encumbrances, defects, and matters specifically excluded by the policy.

Question 31

Title Search

Answer 31

The search of public records to determine the current state of ownership of real estate; examining chain of title.

Question 32

Will

Answer 32

A written document, properly witnessed, providing for the transfer of title to property owned by the deceased.