Unit 6 Flashcards
Habendum clause
That part of a deed beginning with the words”to have and to hold” following the granting clause and defining the extent of ownership the grantor is conveying.
Acknowledgment
A formal declaration under oath that the person who signs a written document does so voluntarily and the signature is genuine. The declaration is made before s registered notary public or an authorized public officer, such as a judge, justice of the peace, or some other person as prescribed by law.
Quick note
Transfer of title requires both delivery and acceptance of the deed
General waranty deed
Provides the greatest protection to the buyer because the grantor is legally bound by certain covenants (promises) or warranty’s.
Basic warranties of general warranty deed
-Covenant of seisin
-Covenant against encumbrances
-Covenant if further assurances
-covenant if quiet enjoyment
-covenant of warranty forever
Covenant of seisin
The grantor warrants that he or she owns the property and has the right to convey title to it. The grantee may recover damages up to the full purchase price if this covenant is broken.
Covenant against encumbrances
The grantor warrants that the property is free from liens or encumbrances, except for any stated in the deed. Encumbrances generally include mortgages, mechanic’s liens, and easements. If this covenant is breached, the grantee may sue for the cost if removing the encumbrances.
Covenant of further assurances
The grantor promises to obtain and deliver any instrument needed to make the title good. For example, if the grantor’s spouse has failed to sign away dower rights, the grantor must deliver a quitclaim deed (discussed below) to clear the title.
Covenant of quiet enjoyment
The grantor garuntees that the grantee’s title will be good against any third party who might bring a court action to establish superior title to the property. If the grantee’s title is found to be inferior, the grantor is liable for damages; this is, the grantor will pay the grantee if the title is not good.
Covenant of warranty forever
The grantor promises to compensate the grantee for the loss sustained if the title fails at any time in the future.
Special warranty deed
Limits the grantor’s defense of the title transferred by warranting that the grantor received the title; and that the property was not encumbered during the time the grantor held title, except as otherwise noted in the deed
Quick note
In areas where a special warranty deed us in common use, the purchase of title insurance typically is viewed as providing adequate additional protection to the grantee.
Quick note
A special warranty deed may be used by fiduciaries such as trustees, executors, and corporations. A special warranty deed is appropriate for fiduciaries because they lack the authority to warrant against the acts of predecessors in the title (the former owners).
Quick note
In a special warranty deed, A fiduciary may hold the title for a limited time without having a personal interest in the proceeds.
A bargain and sale deed
A deed that carries with it no warranties against liens or other encumbrances but that does imply that the grantor has the right ti convey title. The grantor may add warranties to the deed. The granting clause usually states a person’s or entity’s name and the phrase “grants and releases” or “grants, bargains, and sells”. Because the warranty is not specifically stated, the grantee has little legal recourse if title defects appear later. Buyer should purchase title insurance, if it is not provided by the seller.
