Unit 6 Flashcards
Give some examples of when one might own equitable title rather than legal title.
The buyer, during the period of contract contingency; a mortgagee who has the right to execute a strict foreclosure of the mortgage property (in a lien-theory state); a mortgagor (borrower) in a title-theory state; the buyer under a contract for deed purchase until the contract is fulfilled; the holder of an option to buy.
Why is “notice” important in determining who holds title to real estate?
Ownership is a function of evidence. The best evidence is a combination of actual and constructive notice. Actual = direct knowledge; constructive = “could-have-should-have-known” knowledge (especially, public records).
What is the function of a deed?
The deed is a transaction document, not an ownership document. It conveys title, when properly delivered and accepted (and registered, in Torrens counties), then ceases to have any transfer function except as evidence that a conveyance occurred, and as evidence of the warrants the conveyor made.
What is the difference between a bargain and sale deed and a general warranty deed?
A bargain and sale deed covenants valid title but may not warrant against encumbrances or promise to defend against claims. A general warranty deed is a bargain and sale deed that includes assurances of valid title, no encumbrances, and willingness to defend against all claims.
Describe the four types of will.
Witnessed—written, two witnesses; holographic-handwritten or typed, signed by testator; approved-on a pre-printed form approved by the state; nuncupative-written by a witness from testator’s oral statement; generally not valid for real estate transfer.
What happens to Joe’s real estate in your state if Joe dies leaving:
a) a wife, children, and a will;
b) a wife and children, but no will;
c) no legal heirs, and no will?
In general, a) after all claims have been satisfied (including those of legal life estates), the estate goes to the heirs according to the will; b) after all claims have been satisfied (including life estates), the estate goes to the heirs according to the state’s laws of descent and distribution; c) after all claims have been satisfied (here, there can be no life estate), the estate goes to the state by escheat.
What are the conditions necessary for an involuntary transfer by adverse possession to occur?
The adverse possessor must show: a claim of right; possession without concealment; possession without consent; possession for a statutory period; possibly, payment of taxes.
List the important reasons for creating and maintaining title records.
Maintain chain of title by listing previous owners and encumbrances; avoid ownership disputes; give notice of who owns the property and who has claims against it; reveal the marketability of the title; give notice of liens and establish lien priority.
Describe the four principal forms of title evidence.
a. Torrens certificate—a type of title certificate that also acts as a deed of conveyance; title and encumbrances are recorded on the certificate.
b. title insurance policy—an insurance policy indemnifying the policy holder against losses from title defects; the insurer’s “guaranty.”
c. attorney’s opinion of abstract—a written statement from an attorney stating an opinion of marketability based on examination of the title abstract.
d. title certificate—a statement of the condition of title as of the date of the certificate.
Someone who possesses all ownership interests owns _____ to the property
legal title
____ is the right to obtain legal title to a property in accordance with a contract between the legal owner and a buyer.
Equitable title
Receiving ___notice means learning something through direct experience or communication.
actual
_____ notice, or legal notice, is knowledge of a fact that a person could have or should have obtained - recordation of ownership documents in public records (title records).
Constructive
Transfer of title
when the transfer uses a written instrument, the transfer is a conveyance.
Voluntary alienation
public/private grant. A living owner makes a private grant by means of a deed of conveyance. A private grant that occurs when the owner dies is a transfer by will.
Involuntary alienation
without the owner’s consent. Occurs by the processes of descent and distribution, escheat, foreclosure, eminent domain, adverse possession, and estoppel.
It is necessary for the deed to be ___________________ by the grantee for title to pass.
delivered to and accepted
___ clauses describe the details of the transfer
Conveyance
____ clauses present the grantor’s assurances to the grantee.
Covenant
Statutory deeds
the covenants are defined in law and do not need to be fully stated in the deed.
Bargain and sale deed
“I own, but won’t defend.”
General warranty deed
“I own and will defend.”
Special warranty deed
“I own and will defend against my acts only.”
Quitclaim deed
“I may or may not own, and I won’t defend.”
A _______ deed is one tailored to the requirements of specific parties, properties, and purposes.
special-purpose
State law usually requires payment of a documentary stamp ___ on a conveyance of real property
tax
____ include transfers within the immediate family or between government entities.
Exemptions
