Transfer of Title

testimonium Clause

The clause of an instrument that begins "In witness whereof,..."

Title Search

The examination of public records relating to real estate to determine the current state of the ownership. (done 2x normally)

Chapter 7 Bankruptcy

The forfeiture of an individual's assets in exchange for the discharge of debts.

Escrow Disclosure Exceptions

The full list of disclosure requirements is not applicable to: - home equity lines of credit (HELOCs); - reverse mortgages; - mortgages for mobile homes or dwellings not attached to land; - and loans made by a person that is not a creditor (HUD-1 in place of closing disclosure form)

Right of Redemption

The legal ability to buy back one's property within the time specified in each state after a judicial sale by paying the debt, interest and certain costs.

Transfer of Title

The point in time at which the ownership of the goods changes from the exporter to the importer.

Judicial Foreclosure

The process of bringing the property of delinquent borrowers to public sale that involves court action. Proceeds from the foreclosure sale are used to pay off, to the extent possible, the borrower's creditors. - lengthy and expensive

Quiet Enjoyment

The right of an owner or lessee legally in possession of property, to uninterrupted use of the property without interference from the former owner, lessor or any third party claiming superior title.

Foreclosure

The seizure of property from borrowers who are unable to repay their loans - lender seeks to auction the collateral property to satisfy outstanding debt

Subrogation

The substitution of a third person in place of a creditor to whose rights the third person succeeds in relation to the debt. (Title company) - could sue for a cloud on title

Alienation

Transfer of title to real property

Buyer

Vendee

Seller

Vendor

Testator

a person who makes a will

Chapter 13 Bankruptcy

a reorganization form of bankruptcy for individuals that allows the debtors to keep their property and use their income to pay a portion of their debts over three to five years

simple will

a short document that lists the people whom you want to be your heirs and what you want each to receive / spouse

capital gains tax

a tax levied on the returns that people earn from capital investments, like the profits from the sale of stocks or a home

Title Insurance

a type of insurance that protects the buyer if problems with the title are found later

Testamentary trust will

a will that sets up one or more trusts for some or all of the testor's property

Prior to Closing

a. title search b. inspection c. status of loans ("reduction certificate" or "estoppel certificate" which documents any existing loans)

Summaries of Transactions

adjustments between buyer and seller in the closing disclosure

Premises Clause (Granting clause)

conveyance in a deed

Transfer and Recording Taxes

fees; excise taxes or revenue stamps (transfer taxes based on sales price of property paid by seller)

petition in bankruptcy - effect on title

filing of a bankruptcy petition creates an "estate" that includes all of the debtor's interest in property (including real estate) as of the date of the petition.

Election of Remedies

injured party can seek more than one remedy as long as remedies are not inconsistent

Short Sale

lender agrees to accept sale proceeds (from defaulting borrower), even if less than the debt - but they still owe the remainder

Chapter 11 Bankruptcy

reorganization to restore profitability

Title Abstract

the compilation of all documents summarizing the chain of title into a chronological volume and then given to an attorney for final interpretation

Bankruptcy

the legal proceeding by which a bankrupt person's assets are distributed among those to whom he or she owes debts

1099-S Reporting

"a report to be submitted on IRS Form 1099-S by escrow agents to report the sale of real estate, giving the seller's name, Social Security number, and the gross sale proceeds." -- generally filed by the settlement agent (responsible for closing)

Automatic Stay

(Petition in Bankruptcy) - prohibits creditors from collecting debts that the bankrupt incurred before the petition was filed

Title Theory

(deed of trust) lender receives title to the mortgaged property that ripens upon default (trustee sale)

Property Transfer under chapter 11

(reorg) If the court order authorizes the sale, or the confirmed plan of reorganization provides for the sale of the property, the "debtor in possession" will sign the deed (unless the court appoints a trustee for the debtor's estate, in which case the trustee signs the deed).

Property Transfer under chapter 13

(wage earner) If the court approves the sale in the context of a Chapter 13, the sale can take place. If no sale is requested or approved, under the wage earner plan, the title re-vests in the debtor.

Foreclosure/forfeiture

- Foreclosure is the loss of property to pay off a debt. - Forfeiture is losing the property because of disobeying a condition in the deed

Abandonment of Property

- In Chapter 7 case, the court may abandon the property if the property has no value to the estate (no equity). - Once abandoned, the title reverts to the debtor. The debtor himself may want to get rid of (surrender) the abandoned property because it has no value (equity).

Title Insurance includes

- exclusions - updated survey - subrogation

Exempted Transfers

- mortgages 0 correction deeds - transfers between husband/wife - parent/child

Title Insurance Exclusions

- rights of parties in possession (including unrecorded easements) - any facts that accurate survey would reveal - taxes and assessments not yet due or payable - zoning and gov't restrictions that may arise

Types of Wills

1. Simple will 2. Testamentary trust will 2. Holographic will 3. Pour over will

Escrow Closing

A closing by a disinterested 3rd party- often an escrow agent. (salesperson can't be neutral 3rd party)

Probate Sale

A court managed sale of a property during the probate process.

Testate/Intestate

A decedent dies "testate" if he or she dies with a will. A decedent dies "intestate" if he or she dies without a will.

Patent Deed

A deed given by the government to a private individual as evidence of transfer of title from government to the public person.

Deed in Lieu of Foreclosure

A deed given by the mortgagor (lender) to the mortgagee when the mortgagor is in default under the terms of the mortgage. This is a way for the mortgagor to avoid foreclosure. (does not eliminate liens)

Warranty Deed

A deed in which the grantor makes formal assurance as to quality of title. (seisin, quiet enjoyment, against encumbrances, further assurances, warranty forever)

Special Warranty Deed

A deed in which the grantor warrants, or guarantees, the title only against defects arising during the period of his or her 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."

Deed in Partition

A deed issued by the court when property is sold at a partition sale for the purpose of dividing a joint tenancy or tenancy in common ownership.

Bargain and Sale Deed

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 at his or her discretion.

Quitclaim Deed

A deed to relinquish any interest in property which the grantor may have, without any warranty of title or interest. (as-is) Quitclaim deeds are frequently used to clear clouds on title or release his claims against the title.

Correction Deed

A deed used to correct a prior erroneous deed; a deed of confirmation; a reformation deed.

Lien Theory

A defaulting borrower is subject to either a judicial or a strict foreclosure in states that follow the lien theory.

Servicing disclosure statement

A disclosure statement given to borrowers that discloses whether the lender intends to service the loan or transfer it to another lender or servicing company.

Deed

A document that transfers ownership of property from one party to another. - Source of legal title, notice of any encumbrances - A cloud on title could call ownership into question, despite possession of a deed

Strict Foreclosure

A legal procedure which enables the lender to take title from a defaulting borrower without a foreclosure sale. The court grants the borrower a specified amount of time to pay off the loan. If the debt is not paid, title is awarded to the lender.

Further assurance

A provision in a deed containing a covenant or warranty to perform any further acts the grantee (buyer) might require to perfect title to the property.

Warranty forever

A provision in a deed guaranteeing that the seller will for all time defend the title and possession for the buyer.

Affiliated Business Arrangement

A situation where a person in a position to refer settlement services-or an associate of that person-has either an affiliate relationship with or a direct or beneficial ownership interest of more than 1% in a provider of settlement services and who then refers business to that provider or in some way influences the selection of that provider.

Uniform Settlement Statement (HUD-1)

A special HUD form that itemizes all charges to be paid by a borrower and a seller in connection with the settlement. Also called the HUD-1 form. (1 day before settlement)

Special Assessment Tax

A tax issued by the government when providing a benefit for a limited number of property owners (ex. curbs and sidewalks).

ad valorem tax

A tax levied according to value, generally used to refer to real estate tax. Also called the general tax.

Property Tax

A tax on the value of a property

Gift Deed

A transfer of ownership made for love and affection. Creditors of the donor could still use the property for payment of the grantor's debts if it can be shown that the donor was insolvent and transferred the property to evade creditors.

living trust

A trust created by a property owner during his/her life time for the purpose of providing financial care for the family or self.

Pour over will

A will provision in which the testator directs (passes) the residue of the estate into an existing living trust.

Holographic Will

A will written entirely by the testator with his own hand.

Seisin

Actual possession of a freehold estate; ownership. Sometimes spelled seisin or seizen.

Settlement Costs

All costs involved in the settlement or closing of a real estate transaction. Such items include but are not limited to attorney's fees, surveyor's fees, title insurance premiums, recording fees, and appraisal fees.

Recording Acts

All states have statutory rules to resolve the Priority of Claims relating to Real Property and to give the public Constructive Notice of recorded items.

Quiet Title Action

An action brought by a party, seeking an order of the court declaring who has title to disputed property. The court "quiets title" by its decision.

Good Faith Estimate

An estimate of the fees due at closing for a mortgage loan that must be provided by a lender to a borrower within three days of the lender taking a borrower's loan application.

Title Insurance Policy

An insurance policy to compensate or reimburse the insured against any losses sustained as a result of defects in the title.

Title Defect

Any legal right held by others to claim property or to make demands upon the owner. - improper recording of ownership - failure to include signature needed - previous liens or encumbrances - mechanics lien if seller failed to pay for labor, etc. - tax lien

Deed in Foreclosure

Convey's property in a court-ordered foreclosure sale.

Sheriff's Deed

Deed given by court order in connection with sale of property to satisfy a judgment. (given if bought at auction and releases liens)

Clouds on the Title

Encumbrances or outstanding claims that could affect the owner's title; problems or uncertainties with a title to real property.

Like-Kind Exchange

Exchanging one fixed asset for another fixed asset that has similar functionality.

FIRPTA

Financial Institutions Real Property Tax Act. An amount withheld from the sale of property when the seller is a foreigner.

Marketable Title

Good or clear title, reasonably free from the risk of litigation over possible defects.

Deed: Execution

Grantor must sign, grantee doesn't need to (in front of notary)

Federal Tax Deductions

Homeowners may deduct - mortgage interest payments, - real estate taxes, and - some closing costs (points) from federal income tax

Liquidation

If the court authorizes the sale of the property, the deed is signed by the trustee. If the court has abandoned the property, and the property is sold or otherwise transferred, the deed is signed by the debtor.

Sale by Devises/heirs

If the heirs/devisees sell or transfer the property during probate to a third party (or to one or more of their fellow heirs/devisees), the title passes subject to all probate matters (claims against the estate including taxes, creditors rights, rights of the surviving spouse, etc.)

Sale by executor

If the will gives the executor the power of sale, she may sell the property without the approval of the probate court, but must still comply with the statutory requirements (spousal consent, claims of creditors, posting of a bond, etc.).

Capital Gains Exemption

Income tax exemption for profits realized on non-investment, residential property. The capital gains exemption shields a qualifying homeowner from having to pay otherwise applicable income tax on qualified profits realized from the sale of a principal residence. Must have served as the principal residence for at least two of the prior five years Cannot have claimed on another property in prior 2 year span Single-filer: exempt up to $250K capital gain Married filer: exempt up to $500K capital gain

Title by Estoppel

Legal principle, also known as deed by estoppel, whereby a person obtains title to real estate over the apparent owner, because the apparent owner failed provide proper public notice of his ownership interest.

Probate

Legal process by which a court determines who will inherit a deceased person's property and what the assets of the estate are.

Forefeiture

Loss of a legal right, interest, or title by default

Constructive Notice

Notice given to the world by recorded documents. All people are charged with knowledge of such documents and their contents, whether or not they have actually examined them. Possession of property is also considered constructive notice that the person in possession has an interest in the property.

Title

Owning all 6 rights in the bundle of ownership (possess, control, exclude, encumber, dispose) and physical evidence (deed)

In-person closing

Parties to transfer title all there (buyer and seller present)

Conveyance after death

Probate is the process of distributing all of a deceased's assets -- A will must go through probate for real and personal property to be distributed Devise is the act of transferring the deceased's interest in REAL ESTATE to another by a will (hook to deed) Bequest is the act of transferring a deceased interest in PERSONAL PROPERTY to another (hook to bill of sale) If a person dies intestate (w/o a will), the laws of descent and intestate succession will determine the heirs/descedants

Real Estate Owned (REO)

Property acquired by a lending institution through foreclosure and held in inventory. (expensive and annoying to upkeep)

Deed elements

Property description Clauses Execution Delivery & acceptance

RESPA

Real Estate Settlement Procedures Act - requires special information booklet, requires good faith estimate, requires uniform settlement statement (covers loans with mortgage on residential property)

Estate administration (probate proceedings)

Refers to proceedings used to distribute the estate.

Equitable Title

Right to receive legal title after specified performance, like payment in full on mortgage- may be transferred

Habendum Clause

That part of a deed beginning with the words "to have and to hold," following the granting clause and defining the extent of ownership the grantor is conveying.