Transfer of Real Estate

Involuntary Alienation

- Is transfer of property due to rule of law, adverse possession, or accession Dedication- donation of real property to the public by private owner, (can be voluntary) Intestate Succession- process of legal determination when owner doesn't make a will. person who takes property by intestate succession are HEIRS, and received property by DESCENT. Escheat- legal procedure when property reverts to the state government because owner did not leave behind a will and court fails to find any legal heirs. Condemnation- Government have constitutional right to acquire title to private property by compensating the owner by way of fair market value. aka eminent domain, but property being acquired must be used for benefit of the public, and owner must receive just compensation, ie. fair market value Court Decisions- various situations where the court establishes legal title to property. a.)Quiet title action- usually taken to clear a cloud on title of the real property b.)Partition- when there is difference between co-owners regarding distribution, partition action is legal action done to sort out dispute. co-ownership is normally ended or is physically divided c.)Foreclosure- owner fails to pay payments for mortgage and lender seizes property d.)Bankruptcy- person or company financial insolvency is relieved through a legal process known as bankruptcy.

Title

-ownership a person has over a property -Cloud- title defects on a title, which means problem with title -Marketable title- no serious defects on title

Alienation

-transferring title to real estate from one party to another is called alienation -Voluntary Alienation- when owner deliberately transfers title to someone else -Involuntary Alienation- when property transfer takes place as result of the operation of law.

Title Insurance

A title insurance company agrees to reimburse the policy holder for any losses caused by defective titles. however, title insurance will not cover the losses caused by defects that are specifically excluded from the policy. Acquiring Title Insurance- after completion of title search by the title company , a title report is prepared, which describes the condition of the title in question. pg.52 Types of title insurance: pg 53-54

Voluntary Alienation

Executed three ways: A.)Patents- document the government transfers title to a private party. For all land under private ownership, the patent is ultimate source. B.)Deeds- most common of three voluntary alienation -conveyance- process of transferring real property by deed i.) The deed must be in writing. term for this law -Statute of Frauds- ii.) identity of parties, noting full names and marital status is a must. iii.) the grantor must be able to sign. (competent signatory) - grantor's attorney in fact may sign on his/her behalf, attorney in fact appointed by grantor through [power of attorney] iv.) proper description of the property being conveyed. v.) a living grantee vi.) A granting clause, comprised words of conveyance, such as "grant" or "convey" vii.) Acknowledgement, delivery and acceptance of deed by the grantee. -Acknowledgement- when the grantor confirms before a legal witness that his signature is genuine and voluntary. [unacknowledged deed may be valid but cannot be recorded] -Delivered- a deed becomes effective once its delivered to the grantee. key element of delivery is not just the physical transfer of the document but also the intention of the grantor to transfer the title to the grantee immediately. -Accepts- is when the conveyance is said to be completed when the grantee accepts the delivery of the deed C.) Wills, third method of transfer: the title is transferred by a person through a legal document which specifies how his property is to be distributed in the event of his/her death -a will must be in writing, should be signed by the testator, and be attested to by at least two competent witnesses. -Holographic will- has all the material provisions handwritten and is signed by hand by the testator himself. this type of will is valid even though it is not signed in the presence of witnesses -Probate- is the legal procedure to validate the will and then carry out the directions of the testator.

Types of Deeds

a.) Grant Deed- most frequently used instrument to transfer title in California. Contains the word grant(s) in its conveyance and the grantor warrants the following: -the title has not been conveyed prior to this to anyone else -there are no hidden encumbrances on the property other than those already disclosed b.) Gift Deed- property given as a gift to the grantee by relative or close friend. the consideration in a gift deed is called love and affection. c.) Quitclaim Deed- this deed contains no warranties and conveys any interest the grantor may have in the property at the time the deed is signed. referred to as reformation deed. d.) Trust Deed- aka Deed of Trust, is used when a property serves as security for debt. When money is borrowed to finance the purchase of the property, the borrower (new owner) is the trustor (grantor) of the trust deed. the party who holds the title until the debt is paid is the trustee (grantee) the party on whose behalf the title is termed as the beneficiary (lender). e.) Reconveyance Deed- beneficiary notifies the trustee about the clearance of the debt (by the trustor) by sending the trustee a document called request for reconveyance. f.) Sheriff's Deed- a court ordered sale of property g.) Tax Deed- when property is sold due to nonpayment of taxes, tax deed issued by county tax collector h.) Warranty Deed- clearly warrants that the grantor has good title. makes him liable for a flaw in title, even if a flaw without his knowledge is discovered much later.

Adverse Possession

involuntary alienation, possession and use of property can convert into title. It implies that the actual use of the property by an individual may eventually result in a greater interest in that property than the original owner who does not use the property. requirements for adverse possession: -occupation of the property must be actual, open, and notorious. -occupation of the property must be hostile to the actual owner's interest -occupant must claim title to the real property under the claim of right or color of title -continuous and uninterrupted possession -payment of real property taxes

Accession

man made or natural additions to real property. may happen due to following: Accretion- process where soil gradually builds up over a period of time by natural causes on a property near a body of water like a river, lake, or ocean. accumulation of soil is known as alluvium. Reliction- when waters of moving body of water recede naturally and thereby uncovers new land Avulsion- sudden and violent washing away of land by water due to natural cause

Recording

the method of safeguarding one's interest in real property Procedures of recording- done in the county where the property is located by filing a copy of the deed at the county clerk's (recorder's) office Legal consequences of recording- owner is able to give a clear notice to the world about his ownership of a particular property, and sets priority for property. Notice- implies that the person knows or should have known a particular fact Actual notice- when a fact is personally viewed, read about, or heard about it is said to be an actual notice Constructive notice- when, in the eyes of the law, a person is assumed to have known about something whether or not he actually did have such knowledge, is known as constructive notice Wild deeds- A deed that is outside a chain of title Possession and notice- someone who has taken possession of land other than the seller gives notice to the new buyer of his interest in the land. the buyer is supposed to make further inquiry into the matter. this is sometimes referred to as inquiry notice or implied notice