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129 Cards in this Set
- Front
- Back
A title report shows all previously recorded encumbrances on a property |
False. Current encumbrances |
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A title report shows all previous owners of a property |
False. An abstract or chain of title would show this; a title report only shows current status |
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An easment appurtenant is transferred by a deed |
True |
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A woman dies testate and leaves a property to her son in her will. The process used to transfer the property is escheat |
False. The will goes through probate |
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For personal or real property to transfer in a will, the will must go through probate |
True |
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If a deed is NOT recorded, later claims on title could potentially take priority |
True |
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Recording prevents later claims on title from taking priority over an unrecorded interest. |
True |
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A deed of trust is the BEST deed for a purchaser to use to take a title |
False. General warranty deed, as a deed of trust, is used to create liens, not pass title. |
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The deed with the MOST warranties, providing the greatest protection for the buyer, is a general warranty deed |
True |
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An unrecorded deed lacks actual notice |
False. Constructive notice |
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Legal or constructive notice is created by recording documents |
True |
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Title insurance premiums are paid annually |
False. Once at closing |
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Title insurance differs from other types of insurance because the premium is paid only once at the beginning of the policy. |
True |
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A grantor can impose restrictions on the use of property in a deed |
True |
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The covenant of seisin states that the owner will defend the title |
False. Seisin states that the grantor has the right to convey |
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A quitclaim deed is used to limit claims or liability in the future |
True |
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A homeowner who has a warranty deed but still owes on her mortgage holds title to the land |
True |
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A quitclaim deed could transfer clear title from the grantor without any guarantees against a cloud |
True |
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A distant relative of a deceased property owner may have a claim against the property. The attorney from the estate might ask the relative to execute an executor's deed. |
False. Quitclaim deed. |
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The only form of conveyance in which the grantor specifically disclaims both warranties of title and ownership is a quitclaim deed |
True |
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A man inherits a family farm that he has never seen and wants to sell it. He would be BEST protected from liability by using a general warranty deed. |
False. Quitclaim or special warranty deed |
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A quitclaim deed conveys the interest of the grantee |
False. Grantor |
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For a deed to be valid is must be recorded |
False. Recording gives constructive notice |
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For a deed to be valid it must have words of conveyance |
True |
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For a deed to be valid it must be signed by the grantor |
True |
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For a deed to be valid it must be signed by the grantee |
False. Grantor only |
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For a deed to be valid it must be delivered and accepted |
True |
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The primary purpose of a deed is to prove ownership and create a recordable record |
False. Transfer title |
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A deed by which the grantor pledges to defend the title forever against all claims is a general warranty deed |
True |
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To convey an entire property, a deed must contain an accurate description of the house and other improvements |
False. Legal description of the land only needed; all other items are appurtenant |
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A will may be used to transfer property |
True |
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A properly drawn and executed deed is considered legally delivered from the seler to the buyer when the deed is in the possession of the grantor |
False. Grantee |
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The grantee's signature is among the essential elements of a valid deed |
False. Grantor signs |
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A special warranty deed creates the greatest potential risk for the grantor |
False. General warranty deed |
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To convey ownership of a parcel of real estate, the grantor in the deed must be the owner shown by a current opinion of title or title examination |
True |
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A summary of the recorded documents pertaining to the title to a property is a title commitment |
False. Abstract |
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Consideration is among the essential elements of a valid deed |
True |
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Constructive notice of a real estate sale is achieved by recording documents in the public records |
True |
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Recording determines priority of loans |
True |
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The warranty in a special warranty deed is against encumbrances created during the ownership of the grantor |
True |
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The gift of real property by will is known as a devise |
True |
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Quiet enjoyment means that neighbors cannot disturb the owner with loud parties |
False. The grantee will not be disturbed by claims of others |
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Recordation is essential to the validity of a deed |
False. Title transfers upon delivery and acceptance. |
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The BEST deed to limit liability and future claims is a special warranty deed |
False. Quitclaim |
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An individual inherits a family ranch and discovers that the title is clouded. A quiet title suit may be needed to clear the title. |
True |
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The public recording systems cures all title defects |
False. Allows the posting and searching of claims |
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Documents should be acknowledged or notarized to show they were signed without duress |
True |
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A gift of real property by will is a bequest |
False devise; bequest for personal property. |
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The deed that limits the grantor's warranty to the grantor's period of ownership is the general warranty deed |
False. Special warranty deed |
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Regardless of the form of ownership, all owners need to sign the deed to convey full ownership to the new grantee. |
True |
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If an owner in severalty dies testate, the deceased's interests will be probated and passed to the deceased's heirs or devisees |
True |
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Title searches and attorney's opinions are used to guarantee the buyer marketable title. |
False. There is no guarantee, or proff, of marketable title. |
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When a buyer recorded the deed he received, the legal consequence of recording was to serve constructive notice of the buyers ownership interest |
True |
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For buyers, the BEST form of protection against loss of title would come in the form of an owner's title insurance policy |
True |
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Title insurance covers defects and exceptions fround before closing |
False. Defects found after closing |
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A second mortgage can be distinguished from a first mortgage by the date it was recorded |
True |
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The mortgagee's title insurance policy protects the borrower. |
False. Lender |
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The act of recording a deed primarily benefits the grantee |
True |
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A purchase agreement is usually recorded |
False. Easements, deeds, long term leases, and mortgages are recorded |
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Policies and procedures that regulate the recordation of documents for conveying rights and/or interests in real estate are established by federal law |
False. State law |
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The primary purpose of recording deeds and other legal documents is to provide constructive notice |
True |
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A title search will reveal an encroachment |
False. Recorded encumbrances |
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Actual notice is created by recording |
False. By actual visual inspection of the property |
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A cloud of title is MOST likely to be discovered in an appraisal report |
False. Title report or title opinion |
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A standard policy of title insurance would cover the problems created by a forged deed. |
True |
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A deed must be acknowledged in order to be valid |
False. Should be acknowledged to be recorded |
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In a real estate transaction, a licensee should advise the buyer of the need for a title search |
True |
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Possession of real property passes at the time of delivery and acceptance of the deed, unless otherwise agreed |
True |
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The laws of the state in which a property is located govern the acquisition, transfer, and recordation of title to land. |
True |
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An abstract of title contains all the actual documents from the chain of title |
False. It contains a summary of the documents |
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The government transfers real property to a private individual using a private grant. |
False. Land patent |
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The covenant of seisin and covenant against encumbrances would be found in a quitclaim deed |
False. General warranty deed |
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A prescriptive easement is gained through adverse use. |
True |
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For a deed to be valid, it must contain the signature of the grantee |
False. Grantors must sign |
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The legal owner is unknown. The neighbor has no official deed to the land but was awarded title because he had lived on the property more than the required statutory period. This is an example of adverse possession. |
True |
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Tenant A has been awarded an easement by necessity to cross tenant B's property. This easement will terminate automatically after 15 years |
False. Easements terminate only through merger, release, or abandonment. |
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A quitclaim deed can be used to terminate deed restrictions |
True |
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A bill of sale is used to convey title to real property |
False. Personal property |
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The cost of a title insurance policy that protects against defects in the title is paid once every year. |
False. Once, when issued |
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A title insurance policy would include a summary of the links in the chain of title. |
False. Would only include the current status |
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A deed must be executed by the LEAST two competent witnesses in order to be valid |
False. Must contain essential elements; no witnesses needed. |
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Sale and transfer by deed is an example of voluntary alienation |
True |
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The government conveys title to property using a deed |
False. Land patent |
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An individual take possession of an owners land after obtaining the owners permission. The possession continues for 26 years. Thereafter, the occupant attempts to get title to the property. the possessor will be unsuccessful because NOT all the requirements for adverse possession have been satisfied. |
True. Cannot have adverse possession with the owners permission |
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Generally, title insurance coverage extends to exceptions listed in the policy |
False. Only defects are NOT listed in the policy; exceptions are never covered. |
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An individual seller who realizes a net profit of more than $250,000 from the sale of her personal residence may be required to pay a sales tax. |
False. Capital gains tax |
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A title commitment is a commitment to insure title. |
True |
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The mortgagee's policy protects the owner |
False. Lender |
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The title policy is issued before the closing with the title commitment. |
False. At or after closing |
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A property has a first mortgage for $100,000 and the property taxes of $4,500 have NOT been paid. The property tax lien will be in first position |
True |
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A loan for $75,000 is recorded, after which a loan for $150,000 is recorded. The larger lien has priority |
False. Priority is determined by when the lien was recorded. |
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At the closing of a real estate transaction, continuing charges such as taxes and insurance premiums are prorated |
True |
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Upon receiving an offer, the earnest money is deposited in a trust account |
False. Only upon acceptance of te offer will the money be deposited |
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In order for the public to have constructive notice of a deed, it must be registered in the office of property |
False. County recorder |
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The grantee, under a recorded deed, can enforce the deed against the grantor |
True |
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If a broker places earnest monies in his operations account, commingling has occured |
True |
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At closing, the purchase price is normally a credit to the buyer |
False. Credit seller; debit buyer |
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The buyers earnest money is normally a debit to the buyer |
False. Credit to buyer |
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In a closing, the buyer normally pays for recording of a new mortgage |
True |
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The sales commission will normally appear on the buyer's side of the closing statement |
False. Sellers side of the closing statement |
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A loan origination fee would appear on the buyers closing statement |
True |
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At closing, the selling price is a credit to the seller |
True |
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A new loan will be a credit to the buyer |
True. Remember: Loans are always a buyer credit |
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A title search guarantees the buyer of marketable title |
False. No guarantees |
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A title search should disclose real estate tax liens, prior recorded mortgages, and unpaid judgments against the seller |
True |
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The seller normally delivers the deed to the buyer when the sales contract is signed |
False. at closing/settlement |
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An up to date title abstract requires an attorneys opinion to explain the kind of title and its condition |
True |
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In order for a buyer to make certain that a property she is purchasing has no encroachments, she should obtain a title search |
False. Survey or ILC |
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A cloud on the title of a property would probably be revealed by the appraisal |
False. Title search |
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The primary purpose of the Closing Disclosure is to provide a detailed accounting of the amount the buyer will receive or be required to pay at settlement |
True |
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A buyers earnest money will appear on the Closing Disclosure as a credit to the seller and a credit to the buyer |
False. Credit buyer only |
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To determine the amount of cash the buyer will need at settlement, the closing agent will subtract the buyers total credits from the buyers total debits. |
True |
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The charge for a notary fee for the warranty deed will be a debit to the buyer. |
False. Debit to the seller who signed it. |
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Assumed loans are a credit to the buyer and a debit to the seller |
True. Remember: All loans are always a buyer credit |
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Recording of the warranty deed is a debit to the seller |
False. Buyer records the deed |
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Mortgagee's title policy will be a debit to the seller |
False. Buyer |
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Rents are prorated between the buyer and the seller. |
True |
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Security deposits are prorated between the buyer and the seller |
False. Transferred in full to the buyer |
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A lender wanting title insurance coverage on property pledged as collateral would ask for an errors and omissions policy |
False. Mortgagee's policy |
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The loan estimate is due at closing, and the Closing Disclosure is due upon application for a loan |
False. The Closing Disclosure is due at closing; the loan estimate is due at application |
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An owner's policy for title insurance protects the owner and the lender |
False. Owner and heirs while they have an interest |
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The government transfers government-owned real property to a private individual using a land patent. |
True |
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The covenant of seisin and covenant against encumbrances would be found in a quitclaim deed |
False. General warranty deed |
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A title commitment has the MOST historical information |
False. Abstract |
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A property owner has been walking across his neighbors property. Because both of them are aware of the use and the neighbor gave him permission, the property owner has a prescriptive easement. |
False. License |
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Loan origination fees are typically a debit to the seller |
False. Debit to the buyer |
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Property that uses a septic system for sewer needs must often meet size requirements to be in compliance |
True. Often sized on the number of bedrooms |
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A percolation test is standard before completing any sewer system |
False. Used for septic systems |
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A seller who states she is the sole owner of a property in which she is a joint tenant would be in violation of the covenant of encumbrances |
False. Covenant of seisin |