UNIT 3 STUDY SET- INTERESTS IN REAL ESTATE
The homestead exemption in a town is $15,000. Four years ago, a resident purchased a home for $58,000 and then experienced hard times. At a court-ordered sale, the property is purchased for $60,000. If the resident has an outstanding mortgage balance of $35,000 and credit card debts amounting to $24,360, how much is protected by the homestead exemption? - $640 - $2,140 - $15,000 - $16,500
$15,000 The homestead exemption is $15,000. So, when the property is sold for $60,000, the mortgage of $35,000 is paid and $15,000 is reserved, leaving $10,000 for the credit card debt.
A landowner has divided a large parcel of land into smaller parcels and has recently sold a tract near a nature preserve that is landlocked and cannot be entered except through one of the other tracts. The buyer of that property will probably be granted what type of easement by court action? - Easement by necessity - Easement in gross - Easement by prescription - Easement by condemnation
Easement by necessity An easement by necessity arises when there is no ingress or egress (entry or exit) from one piece of property without crossing over a parcel on land owned by another. An easement of necessity is not merely for convenience or imposed to validate a shortcut.
For as long as anyone can remember, neighbor families have used a footpath to get to the river. Recently, the current owner of the footpath erected a fence across the path. Which of these easements might the neighbors claim would require the owner of the footpath to remove the fence? - Easement by necessity - Easement by prescription - Easement in gross - Appurtenant easement
Easement by prescription Long time unauthorized usage may create legal rights leading to an easement by prescription. An easement in gross is a personal right, often used by utility companies. An easement by necessity could be imposed by court order to provide access to a landlocked property.
The electric company has the right to extend its wires over 50 parcels of land. What right does the electric company have? - Appurtenant easement - Easement by necessity - Easement by prescription - Easement in gross
Easement in gross Commercial easements such as this are called easements in gross. They are not attached or appurtenant to a property right.
Which of these is defined as any claim, charge, or liability that attaches to real estate? - Lien - Easement - Deed restriction - Encumbrance
Encumbrance An encumbrance is any claim, charge, or liability that attaches to real estate. Liens, easements, and deed restrictions are all types of encumbrances.
Which of the following is an example of governmental power? - Escheat - CC&R's - License - Lis Pendens
Escheat The four governmental powers that limit private rights to ownership of land are represented by the acronym PETE (police power, eminent domain, taxation, and escheat)
An easement that arises when an owner sells property that has no access to a street or public way except across the seller's remaining land is an easement by prescription. - True - False
False An easement that arises when an owner sells property that has no access to a street or public way except across the seller's remaining land is an easement by necessity.
The purpose of escheat is to expand governmental property holdings - True - False
False Escheat is a process by which the state acquires privately owned property when no owner can be found. For example, when an owner dies and leaves no heirs and there is no will.
The concept of tacking provides that successive periods of occupation by different parties may be combined to reach the required total number of years necessary to establish a class for an easement in gross. - True - False
False The concept of tacking provides that successive periods of continuous occupation by different parties may be combined to reach the required total number of years necessary to establish a claim for an easement by prescription.
A freehold estate is the highest interest in real estate recognized by law. - True - False
False A freehold estate lasts for an indeterminable length of time; a fee simple absolute estate is the highest interest in real estate recognized by law.
If the grantor is silent about what happens to a property after a life estate ends, the grantor has remainder interest in the property. - True - False
False When the creator of a life estate chooses not to name a remainderman, ownership returns to the original owner upon the end of the life estate.
Which of the following is a legal life estate? - Leasehold - Fee simple absolute - Homestead - Determinable fee
Homestead Homestead rights are granted by statute in some states to provide some protection to debtors and their families against the execution of judgement liens on their homes by the action of unsecured creditors.
A patient died in a nursing home. The deceased left no will and had no heirs. What happens to the deceased's $250,000 estate? - It escheats to the state or county - The nursing home gets to keep it - It will be split between the nursing home and the county - It can be paid over to the deceased's church
It escheats to the state or county Because the patient died without a will and there are no heirs, the $250,000 becomes the property of the state or county.
What are deed restrictions? - Public land restrictions - Illegal land restrictions - Private agreements affecting the use of the land - Informal agreements between neighbors
Private agreements affecting the use of the land Deed restrictions are private agreements written into a deed and are privately enforced. Examples of public restrictions include zoning and building codes.
Which of the following is NOT an example of governmental power? - Remainder - Police power - Eminent domain - Taxation
Remainder The four governmental powers that limit private rights to ownership of land are represented by the acronym PETE (police power, eminent domain, taxation, and escheat).
Dower and curtesy are types of legal life estates.
True A legal life estate is a form of life estate established by state law and becomes effective automatically when certain events occur. Dower and curtesy provide that the nonowning spouse has a lifetime right to an interest in the real estate, even if the owning spouse wills the estate to others.
While it does not have a physical effect on property, a lis pendens creates a "cloud on the title" to the property. - True - False
True A lis pendens is a notice filed in the public record of pending litigation affecting title to the property. This "cloud on the title" may prevent the property from being sold or further encumbered.
The process by which the government exercises its right to acquire privately owned real estate for public use through either judicial or administrative proceedings is called condemnation. - True - False
True Eminent domain is the right of the government to acquire privately owned real estate for public use; condemnation is the process by which the government exercises this right.
A state's power to enact legislation that preserves order, protects the public health and safety, and promotes the general welfare is called its police power - True - False
True Police power is the state's right to enact legislation to preserve order, protect the public health, and promote the general welfare of its citizens.
A homestead is a legal life estate in real estate occupied as a family home. - True - False
True A legal life estate is a form of life estate established by state law and becomes effective automatically when certain events occur. Homestead is a legal life estate in real estate occupied as the family home.
A license may be terminated or canceled by the owner of the property, and a license ends on the death of either party or the sale of the affected property by the licensor. - True - False
True A license is personal privilege to enter the land of another for a specific purpose; it can be terminated or canceled and ends with the death of either party or with the sale of the land.
Real estate taxes, mortgages, judgements, and mechanics' liens all represent possible liens against an owner's real estate. - True - False
True A lien is a charge against property that provides security for a debt or an obligation of the property owner.
An easement appurtenant is attached to the ownership of real estate and allows the owner of that property the use of a neighbor's land. - True - False
True An appurtenant easement is said to run with the land and transfers with the deed of the dominant tenement.
Covenants, conditions, and restrictions (CC&Rs) are used by a subdivision developer to maintain specific standards in a subdivision. - True - False
True CC&R's might apply to certain architectural or design specifications. CC&R's are detailed in the original development plans and referenced in the deeds to individual properties in the subdivision.
The four governmental rights that affect real estate are taxation, eminent domain, escheat, and police power. - True - False
True Government rights include police power (building codes), eminent domain (right to acquire private property for public use), taxation (raise funds to meet public needs), and escheat (acquires private property for which no owner can be found).
Which of these must exist for an appurtenant easement to exist? - Two adjacent parcels, different owners - Two adjacent parcels, one owner - Landlocked property that requires passage to the street - Long-time unauthorized usage
Two adjacent parcels, different owners An easement appurtenant must have two owners and two parcels of land. A landlocked parcel would require an easement by necessity; long time unauthorized usage would lead to an easement by prescription.
The owner of fee simple title to a vacant lot adjacent to a hospital decided to make a gift of the lot to the hospital. The deed conveyed ownership of the lot to the hospital "so long as it is used for hospital purposes. " After completion of the gift, the hospital will own - fee simple absolute estate - a license - a fee simple determinable - the license property
a fee simple determinable A determinable fee estate has a special limitation and may end automatically if there is noncompliance with that stipulation. Language such as so long as or while characterize this estate. The hospital's ownership of the lot would come to an end if the property were to be no longer used for hospital purposes, and the lot would immediately become the property of the former owner or that owner's heirs.
A property owner gave land to a school "so long as the land is used for only academic and recreational purposes." The ownership interest granted here is called - an easement by prescription - an encumbrance - a bundle of rights - a fee simple determinable
a fee simple determinable The terms so long as, while, and during generally indicate creation of a fee simple determinable interest. The school obtains the full bundle of rights of a property owner, but one of the "sticks" in that bundle has a special feature.
A person has permission from a property owner to hike on the owner's property during the autumn months. The hiker has - an easement by necessity - an easement by condemnation - riparian rights - a license
a license Such permission given to an individual is personal, nontransferable, and can be withdrawn.
Because a homeowner failed to pay the real estate taxes on time, the taxing authority imposed a claim against the homeowner's property. This claim is known as - a deed restriction - a lien - an easement - a reversionary interest
a lien Unpaid real estate taxes are a lien on the property because they are a charge against the property that provides security for a debt or an obligation of the property owner.
There is notice in the public record of pending litigation affecting the title to a property. The notice reflects which of the following? - Fee simple determinable - Police power - An encroachment - A lis pendens
a lis pendens A lis pendens is a notice filed in the public record affecting the title to property or a claimed ownership interest in it.
A license is an example of - an easement appurtenant - an encroachment - a personal privilege - a restriction
a personal privilege A license is a personal, revocable right of use. It is temporary in that it can be withdrawn at will by the one who issued it.
An owner conveys ownership of a residence to a church but reserves a life estate in the residence. The future interest held by the church is - a pur autre vie - a remainder - a reversion - a leasehold
a remainder Until the owner dies, the church will have a remainder interest. The owner reserved a life estate. The church may legally sell its future (remainder) interest, even during the lifetime of the life tenant.
A property owner who has the legal right to use a neighbor's land holds - an estate in land - an easement - a police power - an encroachment
an easement An easement is a right of use or passage, not of ownership- nor is it is an example of encroachment or the exercise of a government's police power.
The type of easement that is a right-of-way for a utility company's power lines is - an easement in gross - an easement in necessity - an easement by prescription - a nonassignable easement
an easement in gross Easements in gross are individual rights to use someone's land, as in the case of the utility company. A commercial (but not a personal) easement in gross can be assigned, conveyed, and inherited.
The new owner of a property installs a fence on the property. By mistake, the fence extends one foot over the lot line onto a neighbor's property. The fence is an example of - a license - an encroachment - an easement by necessity - an easement by prescription
an encroachment To build over a property line is to encroach on the property of another.
When two properties share a party wall that straddles the boundary line between the two lots, each lot owner owns the half of the wall on each lot and has a (n) _________ easement in the other half of the wall
appurtenant
A large undeveloped parcel of land on the side of a hill borders a road on its lower edge. The owner of the parcel sells the lower portion of the property to a buyer who builds a home on it. Several years later, the upper portion of the property is sold to someone else. The upper portion of the property does not border any road. To gain access to the road, the owner of that property has a legally implied right to an easement - by necessity - in gross - by prescription - by restriction
by necessity An easement by necessity could be created by court order to permit legal access to the second party.
When a claimant has used another person's land for a certain period of time and in a manner defined by state law, the claimant can claim an easement __________
by prescription
The process by which the government exercises its right of eminent domain
condemnation
A __________ cannot violate any law, such as a fair housing law, by attempting to prohibit certain property transfers
deed restriction
A private agreement that affects the use of land
deed restriction
In some states, a husband could not sell his property unless his wife also signed the deed. The wife's interest was called - personal property - homestead - curtesy - dower
dower Historically, a wife's interest in her deceased husband's property was dower, a husband's interest was curtesy. Protection of some part of the family home is called homestead.
An estate based on the lifetime of a person other than the life tenant
easement
The automatic transfer of real property to the state when the owner dies without heirs or a will
eminent domain
A property on Main Street was formerly a retail store will become the site of a new city hall, made possible by the government's power of - escheat - possibility of reverter - eminent domain - taxation
eminent domain Eminent domain is the right of the government to acquire privately owned real estate for public use.
The right of a government body to take ownership of real estate for public use is called - escheat - eminent domain - condemnation - police power
eminent domain The right is eminent domain; the process by which the right is exercised is condemnation. Escheat and police power are other examples of government limitations on rights of private ownership.
If the government acquires privately owned real estate through a condemnation suit, it is exercising its power of - escheat - reverter - eminent domain - defeasance
eminent domain The right of the state to acquire private property for public use is eminent domain. The court action is called condemnation. Property escheats back to the state when it becomes ownerless; that is, the owner dies leaving no heirs and no will.
The state's authority to enact legislation to protect the public is passed through to municipalities and counties by - police power - enabling acts - licensing laws - processing papers
enabling acts The state passes police power to local counties and municipalities by enabling acts. Licensing laws are an example of police power.
An interest in real estate that does not rise to the level of ownership or possession yet still gives some degree of use or control of the property
encroachment
A legal life estate in which an individual's primary residence is protected, in whole or in part, against certain creditors
encumbrance
The degree, quantity, nature, and extent of an owner's interest in real property
escheat
The process by which government takes control of a property after the owner dies without a will or lawful heirs is - escheat - lis pendens - condemnation - taxation
escheat Escheat is a process by which the state may acquire privately owned real or personal property. State laws provide for ownership to transfer, or escheat, to the state when an owner dies and leaves no heirs (as defined by the law) and there is no will or living trust instrument that directs how the real estate is to be distributed.
The highest interest in real estate recognized by law
estate in land
A class of estates in land that lasts for an indeterminable period of time
fee simple absolute
One who has ownership rights of real estate that could continue forever and which provide that no other person can claim to be the owner of or have any ownership control over the property has - fee simple absolute - life estate - determinable fee - condition subsequent
fee simple absolute Fee simple is an absolute ownership- an inheritable interest "with no strings attached." A life estate is noninheritable; fee on condition subsequent and determinable fees are both estates involving another person with an interest called "possibility of (either reverter or) re-entry.
The right of a government to acquire privately owned real estate for public use
fee simple defeasible
A property owner conveyed a one-acre parcel of land to a preschool. The deed stated that the property was to be used only as a playground; the property owner reserved a right of reentry. What kind of estate has been granted? - Leasehold - Fee simple subject to a condition subsequent - Fee simple absolute - Curtesy
fee simple subject to a condition subsequent The property owner has granted a fee simple subject to a condition subsequent. If, at some point in the future, the land is not used as a playground, the former owner or the former owner's heirs may exercise the right of reentry by retaking physical possession of the land.
A life estate is a type of __________ that is limited in duration to the life of the owner or some other specified person or persons.
freehold estate
A class of estates in land for which the length of time can be determined
freehold estates
In a fee simple subject to a condition subsequent estate, the right of reentry may never take effect. Therefore, this right is considered to be a (n) __________
future interest
The right to use another's land for a particular purpose
homestead
A homeowner may be allowed certain protection from judgments of creditors as a result of the state's - littoral rights - curtesy rights - homestead rights - dower rights
homestead rights Homestead rights are granted by statute in some states to provide some protection to debtors and their families against the execution of judgement liens on their homes by the action of unsecured creditors.
A railroad right of way is an example of an easement __________
in gross
A state's ability to enact legislation to preserve order, protect the public health and safety, and promote the general welfare
leasehold estates
A type of life estate established by state law rather than voluntarily by an owner is a (n) __________
legal life estate
When a building, fence or driveway illegally extends beyond the boundaries of the land of its owner or legal building lines
license
A notice filed in the public record of pending litigation affecting the title to property or a claimed ownership interest in it
lien
A charge against property that provides security for a debt or obligation of the property owner
life estate pur autre vie
The holder of a life estate is called - an encumbrance - a life tenant - a remainderman - a successor
life tenant A life tenant is not a renter like a tenant associated with a lease. A life tenant is entitled to the rights of ownership and cam benefit from both possession and ordinary use, just as if the individual were a fee simple owner, but only while the life tenant is still living.
The person to whom property passes when a life estate ends
lis pendens
A homestead is a legal life estate in real estate that is - leased by renters - occupied as the family home - used as a vacation home - a secondary residence
occupied as the family home In many states, a portion of the area or value of this land is protected or exempt from judgements for debts other than those secured by the property.
A charge imposed on real estate to raise funding for government services
police power
Due to a court decision in 2005, many states are drafting legislation to establish a narrow meaning to the term __________ in eminent domain proceedings to stop condemnations justified solely for economic reasons.
public use
The state requires enough land to build a four-lane highway. For the state to acquire the needed land, the state must do all of these EXCEPT - demonstrate that the taking of the land is for the public good - pay a fair and just compensation to the owner - allow the property owner the right to appeal any decision - reimburse the property owner for the amount that the property owner paid for the land
reimburse the property owner for the amount that the property owner paid for the land To acquire private property through eminent domain, the state must prove that the purchase is for the public good, pay a fair price and allow the property owner full rights to appeal. The price may or may not reflect what the owner paid for the property.
All of the following will terminate an easement EXCEPT - when the need no longer exists - nonuse of a prescriptive easement - abandonment of easement - release of the right of easement to the dominant tenement
release of the right of easement to the dominant tenement An easement is terminated when the owner of the dominant tenement releases that right to the owner of the servient tenement.
An easement is terminated by - transfer of the servient tenement to a new owner - creation of a prescriptive easement - transfer of the dominant tenement to a new owner - release of the right of easement to the servient tenement
release of the right of easement to the servient tenement An easement is terminated when the owner of the dominant tenement releases that right to the owner of the servient tenement.
A personal privilege to enter the land of another for a specific purpose
remainderman
If the creator of a life estate does not name a remainderman, the original owner retains a __________ upon the end of the life estate
reversionary interest
An easement appurtenant - terminates with the sale of the property - is a right of way for a utility company - is revocable - runs with the land
runs with the land An easement appurtenant can only be created if the adjacent properties involved have different owners. This easement runs with the land and transfers with the deed.
A fee simple determinable is qualified by a (n) __________ that ends the estate automatically on the current owner's failure to comply with this element.
special limitation
An estate qualified by some action or activity that must or must not be performed
taxation
If the dominant estate merges with the servient estate, which of these is TRUE? - The easement remains in effect for the entire parcel. - The easement is suspended but cannot be terminated. - The easement is terminated. - The new owner must bring a suit seeking severance of the easement from the combined properties.
the easement is terminated If the owner of the dominant tenement also becomes owner of the servient tenement (or vice versa), the easement terminates. Because the same person owns both properties, there is no need for the easement to exist.
A resident of Sunny Oaks owned two acres of land, sold one acre, and reserved an easement appurtenant for entrance and exit over that acre to reach the public road. The acre that was sold is - capable of being cleared of the easement if the woman sells to a third party - the servient tenement - the dominant tenement - subject to an easement in gross
the servient tenement The man's parcel is the dominant tenement and benefits from the easement. The easement runs over the property that was sold, the servient tenement.
Your neighbors use your driveway to reach their garage on their property. Your attorney explains that ownership of the neighbors' real estate includes an easement appurtenant giving them the driveway right. Your property is - dominant tenement - tenement - leasehold - servient tenement
the servient tenement Your driveway is on the property over which the easement runs and is the servient tenement. The adjacent property owned by the neighbors is known as the dominant tenement.
A spouse dies, leaving real estate owned as separate property to the surviving spouse, but with the provision that when the surviving spouse dies, the real estate goes to a specified charity. The surviving spouse owns a bundle of rights but does not own the right to - will the property - sell the property - lease the property - decorate the property
will the property The surviving spouse owns a life estate, and has the entire bundle of rights except the right to will the property.
Every workday for the past 20 years, a woman has parked her car in a specific place in the nearby parking garage. Today, she receives a notice that the garage will be replaced by an office building. Can they do this to her after all the years she parked there? - No, because the accountant has been parking there for more than 20 years and now has an easement by prescription - No, because the accountant paid for the parking space regularly and on time - Yes, because the accountant only had a license - Yes, because the accountant has nothing in writing
yes, because the accountant only had a license A license is a personal right to enter a property for a specific purpose. There is no buildup of rights.