principles of real estate pt 2

a deed must have what essential elements

-grantor/grantee -acts of conveyance -consideration -legal description -habendum clause -limitations & "subject to" clause -signature of the grantor -acknowledgement/recording -delivery & acceptance

5 additional essential elements to a valid real estate contract

-legally competent parties -offer & acceptance -consent -legal purpose -consideration

What is the statute of frauds

A law requiring contracts conveying ownership in real property to be in writing to be enforceable

What's a sub-agent?

A licensee who works for one firm but who is engaged by another firm to perform agency functions on behalf of that firm's client

Title insurance covers claims by individuals who live or lived on the property in question, as long as what's in place

A public record of tenancy

Seller's sworn statement assuring there are no other title defects not shown in the title search

Affidavit of title

Larry is assisting a buyer who's making an offer on his client's listing. If Larry is too helpful to the buyer, what might occur

Implied agency and undisclosed dual agency

What are the two most common ways to mitigate the effects of title issues

Initiate an action to quiet title, Purchase title insurance

How does title insurance affect the lender

It protects the lender from loss due to defective titles

Murphey's farm has been in his family for generations, since his great-great-great-grandfather received it as a land grant in 1862. What's the beginning point of this property's chain of title?

Murphey, the current owner

What is the key difference between assignment and novation of a contract

Novation releases the original party from all obligations, while assignment does not

At what point in the sales transaction process does the title insurance company issue the title insurance policy

Once the requirements have been satisfied, and the seller has delivered the deed to the buyer

The abstract of title can reveal outstanding issues with the property including ______

Owners, property liens, taxes, and easements

Conrad just closed on the house he's buying to fix up. Why should he follow up to be sure the deed has been recorded

Recording provides constructive notice that he owns the property.

Where can a party reviewing a title commitment find basic details about the transaction

Schedule A

Which option is true if a deed is not recorded after closing

The property's legal ownership can be challenged.

A quitclaim deed does which of these

Transfers without warranty any interest or title the grantor has when conveying it

Christina purchased a house from Thomas. When did she officially gain ownership of the property?

With the transfer of deed from the seller to the buyer

When does title officially change hands?

With the transfer of the deed from the seller to the buyer

Obtained from a title insurance company to provide evidence of title

abstract of title

an oath of a subscribing witness, such as a notary public. The grantor must state to the notary that the signing of the deed is a voluntary act

acknowledgment

The element of a deed that signifies the grantor's intention to transfer title to the grantee is the ______

act of conveyance

The physical removal of the tenant, accomplished by legal process

actual eviction

what method of alienation: Al lived in a shed behind Ed's house for 10 years. Ed lists the house for sale; Al claims the shed and the property it sits on are his

adverse possession

what method of involuntary alienation is when sometimes private individuals can claim ownership of someone else's property by using it as their own for an extended period of time

adverse possession

methods of involuntary alienation

adverse possession, court-ordered partitioning of property, descent, escheat, eminent domain, foreclosure, natural processes, regulatory taking

Someone who's been given the authority to act on behalf of someone else is a(n) ______

agent

cloud on title is

any encumbrance, such as a lien or inheritance claim that impedes the conveyance of property

which common contract clause specifies that contract disputes will be settled through arbitration rather than through a lawsuit

arbitration

The substitution of tenants, putting the responsibility for the lease contract in the new tenant's hands (although it doesn't fully relieve the former tenant from liability should the new tenant fail to pay); requires landlord's written permission

assignment

what type of deed is usually conveyed without covenants because the person doing the conveying never actually owned the property

bargain & sale deed

what type of contract is a mutual contract that involves an exchange of promises or other consideration between two parties

bilateral

what common contract clause points out that the contract will be interpreted under the laws of the given jurisdiction

choice of law

If a property has a legal claim against it, what is the property said to have

cloud on title

contracts can be released by

conditional, unconditional, with consideration

A deed must include evidence that something of value (usually money) is being exchanged. This is called

consideration

A situation in which the tenant is prohibited from quiet enjoyment of the premises, and vacates (in such cases, the tenant is evicted for all practical purposes because enjoyment of the premises is not available)

constructive eviction

for adverse possession to occur, possession must be

continuous and uninterrupted, hostile possession, or open & notorious possession

what type of method of involuntary alienation is when a court decides how property owned by tenants-in-common will be divided

court-ordered portioning of property

what covenant is the grantor is assuring the grantee there are no encumbrances against the title other than those set forth in public record or the deed itself

covenant against encumbrances

what covenant is a promise to that the grantor will provide any additional assurances that the grantee reasonably requires & perform any acts necessary to correct any defect in the title being conveyed

covenant for further assurances

what covenant is assurance by the grantor that the grantee will not be disturbed in the use & enjoyment of the property because of a title defect passed on by the grantor

covenant of quiet enjoyment

what covenant is the grantor has the legal capacity to convey title & has the title to convey

covenant of right to convey

which covenant is the estate is possessed by freehold- the grantor holds the title specified in the deed

covenant of seisen

which covenant states the grantor will warrant & defend the title to the grantee against the lawful claims of others

covenant of warranty

Property owners can also give land to the government without consideration and for the public's use. This type of voluntary alienation is called a

dedication of deed

Which document is used to establish proof of ownership and to transfer the title

deed

If property is transferred to another without consideration (the giving of something of value in exchange for something of value), it's known as a

deed of gift

what type of involuntary alienation is through the probate process, the court determines who inherits the deceased's real & personal property

descent

exists when two agents from the same brokerage represent the buyer and seller in a transaction

dual licensed dual agency

this includes the use or threat of force, such as blackmail or bodily harm

duress

what method of alienation: Marcia has to sell her house to the state, which is removing houses to widen a highway

eminent domain

what type of involuntary alienation does the government take private land for use

eminent domain

what type of contract will stand up in court

enforceable

what type of involuntary alienation does the state take ownership of property that belonged to a person who died intestate with neither heirs nor creditors, & uses it for the public good

escheat

Prevention of a legal claim that is contrary to the person's own actions

esstopel

Proves ownership of the property

evidence of title

A contract in which all the parties have met all terms of the contract.

executed

what type of deed is a type of bargain and sale deed with a covenant, An executor's deed conveys real property from a decedent's estate to a buyer. An executor can do this only if the will or court of law granted the executor this authority.

executor's deed

A contract in progress; one or more terms of the contract remain undone

executory

what type of contract is a stated (written or oral) agreement between two parties to specific terms

express

After purchasing a property, what can Jeremiah do to clear a possible future claim on the property's title?

file a suit to quiet title

contains the strongest and broadest form of guarantee of title of all the deed types, and the greatest protection to the ownership interest of the grantee

full covenant & warranty deed

what type of contract is based on the actions or behaviors of the parties, not on words

implied

which common contract clause releases one or more parties from liability or loss

indemnification

The deed must have words of conveyance that signify the grantor's

intention to transfer title to the grantee

A contract in which one or more of the essential elements is missing

invalid

what protects the lender's interest in the property for the amount of the loan

lenders policy

Which type of agent is an escrow officer?

limited agent

which common contract clause allows the aggrieved party to collect reasonable damages, even if damages are hard to calculate

liquidated damages

Title to property is free and clear of liens and only subject to loan payoff and any taxes owed

marketable title

what type of involuntary alienation is loss or acquisition of real property through natural causes, such as erosion, accession, accretion, avulsion, and reliction

natural processes

An offer to purchase a specific piece of real estate but without the obligation to buy it

option contract

three ways in which a buyer can be relieved from the obligations of a sales contract

performance, assignment, and novation

the grantor is

person conveying the title, typically the seller

the grantee is

person receiving title, typically the buyer

which type of deed does not offer any warranties to the grantee- all it does is release any rights of the grantor to the property to the grantee

quitclaim deed

acceptance after the fact, sometimes in contrast to a prior agreement

ratification

what type of deed contains no covenant or warranties, but does imply ownership (seisin). it is used in bankruptcy proceedings and foreclosures. In a foreclosure auction, it is the legal document that gives ownership of the foreclosed property to the highest bidder.

referee's deed

what method of alienation: The city council imposed so many use restrictions on Myron's property, there's no way he could recoup his initial investment if he sells

regulatory taking

what method of involuntary alienation does the government regulates private property to the detriment of the landowner, resulting in diminished use or value

regulatory taking

Illegal eviction in which the landlord has taken matters into his own hands, and evicts the tenant without using legal procedures

self-help eviction

which common contract clause notifies the parties that even if one part of the contract is found invalid, the other parts of the contract can be valid & enforceable

severability

exists when one licensee represents both the buyer and seller in a transaction

single license dual agency

which common contract clause states the time frame in which a party can file a lawsuit relative to the contract

statue of limitations

When a person dies with a will in place, he has died

testate

what common contract clause specifies the date by which performance of the contract needs to be completed

time of performance

legal concept of property ownership and all the rights that go with it

title

Protects the buyer from defects in the title

title insurance

Your buyer is worried that after she closes on her property, she'll find out someone else has a claim to its ownership. What can reassure her

title insurance

A search of public records to provide a title commitment or abstract of title

title search

alienation is the act of

transferring ownership of a property, can be voluntary or involuntary

this exists when an act of persuasion overcomes another individuals free will & judgement

undue influence

A contract that will not hold up in court.

unenforceable

what type of contract is in which consideration (such as a promise) is only given by one party to the other

unilateral

a contract that contains all the essential elements.

valid

A contract with no legal force or effect.

void

A contract that may be cancelled by one or more parties for one of several reasons. It may be missing an essential element and thus invalid; it may contain a mistake or a misrepresentation, or it may have been created or executed by a party under dures

voidable

methods of voluntary alienation

will & deed

every deed must be in

writing