Unit 7 Flashcards
Constructive notice
someone took deed down to courthouse and had it recorded
How to serve a constructive notice
get recorded or physically move into property and take possession
Actual notice
there has been a transfer of title and people have actual knowledge it happened but no one necessarily moved in or recorded deed
Recording
act of places documents in public record
Who has superior priority
he or she who records first has a superior priority
Chain of title
record of a property’s ownership; law does not require these get recorded
Title search
search the chain of title including past 40-60 years of conveyances up to the previous owner
Action to quiet title
establish ownership by a court action
cloud on a title
ownership cannot be traced through an unbroken chain, a gap in the chain
Abstract of title
summary report of what the title search found in the public records
Marketable title
title is acceptable to a reasonably prudent person and which will not subject the buyer to litigation; does not disclose the purchases to the hazard of litigation; and the purchaser could sell or mortgage the property at a later time
Is a deed proof of ownership
no
When do questions of a marketable title need to be raised?
before acceptance of the deed
What is the best proof of title?
title insurance policy
What provides proof of ownership?
Certificate of title accompanied by an attorney’s attorney’s opinion of title
Title insurance policy
insures the title against a defect in the deed
What types of coverage can you get on a title insurance policy?
standard or extended
Does a title insurance policy cover defects or liens already listed in the deed?
no
When is the annual premium paid for a title insurance policy?
day of closing
What is evidence that a title is marketable?
proof of ownership
Owners policy
goes to the new buyer; customary but not law; paid for by seller
Lender’s policy
mortgagee that protects the lender that does not exceed the amount of the loan
Torrens system
abstractor does title search, present information to a court, court holds hearing and judge issues opinion if title is marketable → if clear, issues document to buyer called Torrens certificate
Torrens certificate
document submitted to buyer in Torrens system
Do states that use the torrens system require title insurance?
not usually because opinion of court
Subrogate
give up your right to sue to the insurance company
Is a certificate of title guarantee of ownership
no
Attorney’s opinion of title
based on a review of the abstract and determines if sufficient evidence of title
title insurance
contract under which the policyholder is protected from losses arising from defects in the title
Owner’s policy
issued for benefit of owner
lender’s policy
issued for the benefit of the mortgage lender
What is the amount of the coverage for a mortgage loan determined by?
amount of the mortgage loan
