Unit 6: Transfer of Title

Question 1

T/F Transfer of title is an aspect of a real estate sales transaction generally handled by lawyers and title companies,

Answer 1

True

Question 2

Title Concepts - voluntary alienation

T/F: A “grantor” conveys property TO a “grantee”

Answer 2

True

Question 3

Title Concepts - voluntary alienation

T/F: A “grantee” receives property FROM a “grantor”

Answer 3

True

Question 4

title Concepts - Voluntary alienation

What is a “deed” and what does it convey?

Answer 4

A deed is the instrument that conveys property from grantor to grantee

Question 5

What is “Voluntary Alienation”

Answer 5

Voluntary alienation is the legal term for the transfer of title during the property owner’s lifetime

Question 6

How is a “deed” executed”

Answer 6

a deed is executed by the grantor

Question 7

Who is the “grantor”?

Answer 7

The grantor is the owner who transfers the property

Question 8

Who is the “grantee”?

Answer 8

The grantee is the person who receives the property

Question 9

What are the requirements for a valid deed (9)

Answer 9

• grantor who has the legal competency to execute the deed

-grantee named with reasonable certainty to be identified

-statement of consideration

-granting clause (words of conveyance)

-Habendum clause, which defines the ownership right received by the grantee

-accurate legal description of the property conveyed

-any relevant exceptions or reservations to conveyance of full title

-acknowledgement (notarization) of the signature of the grantor

-delivery of the deed and acceptance by the grantee to pass title

Question 10

What is a “habendum clause”?

Answer 10

The habendum clause begins with the words to have and to hold. Its provisions must agree with those stated in the granting clause

Question 11

What is an “acknowledgement”?

Answer 11

an acknowledgment is a formal declaration under oath that the person who signs a written document does so voluntarily and that the signature is genuine

Question 12

Types of Deeds

General Warranty deed

Answer 12

this deed provides the greatest protection to the buyer because the grantor is legally bound by the certain covenants (promises) or warranties.

Question 13

Types of Deeds

Special Warranty deed

Answer 13

A deed in which the grantor warrants, or guarantees, the title only 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 but not otherwise.”

Question 14

Types of Deeds

Bargain and sale dee

Answer 14

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.

Question 15

Types of deeds

Quitclaim deed

Answer 15

provides grantee with the lease protections. Caries no covenants or warranties and generally convesys only whatever intereste the grantor may have when the deed is delivered.

Question 16

Types of Deeds

Deed of Trust

Answer 16

An instrument used to create a mortgage lien by which the borrower conveys title to a trustee, who holds it as security for the benefit of the note holder (the lender); also called a deed of trust.

Question 17

types of deeds

reconveyance deed

Answer 17

A deed used by a trustee under a deed of trust to return title to the trustor.

Question 18

types of deeds

trustee’s deed

Answer 18

A deed used by a trustee under a deed of trust to return title to the beneficiary
.

Question 19

What is a “transfer tax”

Answer 19

Tax stamps required to be affixed to a deed by state and/or local law.

Question 20

Math

A state has a transfer tax of $1.50 for each $500 (or fraction of $500) of the sales price of any parcel of real estate. The transfer tax is to be paid by the seller. To calculate the transfer tax due in the sale of a $300,000 house, use the following two steps:

Value ÷ dollar amount per taxable unit = taxable units

Taxable units × rate per unit = tax

Answer 20

In this example:

$300,000 ÷ $500 = 600 taxable units

600 × $1.50 = $900

The seller in this transaction must pay a transfer tax of $900 to the state.

Question 21

What is involuntary alienation”?

Answer 21

act of transferring property to another involuntarily - usually by operation of law

Question 22

examples of involuntary alienation

Answer 22

-condemnation allowed by state’s power of eminent domain

-foreclosure of a mortgage loan

-sale to satisfy delinquent tax liens

-transfer on death of owner by law of intestate succession or if no heirs found, to state by excheat

-adverse possession

Question 23

what happens whena. person dies “intestate” (wihtout valid will)

Answer 23

the title to the real estate passes to the heirs identified in the state’s law of intestate succession. if no heris can be identified or found, the state will acquire the prperty by the state’s power of escheat

Question 24

What is adverse possession?

Answer 24

Another means of involuntary transfer. The actual, open, notorious, hostile, and continuous possession of another’s land under a claim of title. Possession for a statutory period may be a means of acquiring title.