Transfer of Title

Title insurance covers claims by individuals who live or lived on the property in question, as long as what's in place? An affidavit from the resident Approval from the current owner A public record of tenancy A tenant add-on insurance policy

A public record of tenancy

Which of these is excluded on a title insurance policy on Martha's property because of the schedule of exceptions? A mechanic's lien recorded by A1 Siding and Windows A verbal lease agreement Martha has with her neighbor who leases Martha's garage Last year's unpaid property taxes The current year's unpaid property taxes

A verbal lease agreement Martha has with her neighbor who leases Martha's garage

The TRID-required settlement statement is called the ________________________. Working with the lender, the closing officer prepares the CD, incorporating all the figures and calculations required for the loan and other closing costs

Closing Disclosure (CD)

Mario lives in a state that requires an abstract of title for property conveyance. The chain of title is broken approximately 50 years prior to the current date. Which of these properly identifies the status of Mario's title? As long as the chain of title is traceable for at least the past 30 years, Mario will have marketable title. Depending on his state's laws, Mario may have marketable title. Mario will have to perform his own research to find information necessary for repairing the broken link. Unless the chain of title can be tracked back to its beginning, Mario won't have marketable title.

Depending on his state's laws, Mario may have marketable title.

How does title insurance affect the lender? It protects the lender against any future default in the buyer's payment. It protects the lender against unexpected increases in loan costs. It protects the lender from loss due to defective titles. It protects the lender from the property value decreasing due to market fluctuations or property damage.

It protects the lender from loss due to defective titles.

Why is proof of ownership required when transferring real property? It places the new owner's name on the deed. It provides evidence that the title is marketable. It provides proof that property taxes have been paid for the property. It verifies the property address.

It provides evidence that the title is marketable.

Which of these statements about a deed's habendum clause is true? It describes any easements or liens against the property. It's a description of the act of conveyance. It's required in all deeds. It's the full legal property description.

It's a description of the act of conveyance.

What's the relationship between the Loan Estimate and the Closing Disclosure? Lenders issue the Loan Estimate to verify the figures detailed on the Closing Disclosure. Lenders issue the Loan Estimate within three days of receiving an application, and Closing Disclosure figures should be similar to the loan estimate. Loan Estimate figures should match Closing Disclosure figures exactly. The Closing Disclosure outlines the lender's responsibilities to the borrower.

Lenders issue the Loan Estimate within three days of receiving an application, and Closing Disclosure figures should be similar to the loan estimate.

Margo's accountant tells her that she's eligible to deduct the property taxes she paid last year. Select the statement about this deduction that's true. Margo can only deduct the property taxes charged back to her at closing. Margo has to be an investor to be eligible to deduct property taxes. Margo is in the ownership stage of the property ownership lifecycle. Margo is in the reversion stage of the property ownership lifecycle.

Margo is in the ownership stage of the property ownership lifecycle.

The _____________________________________ ensures that buyers receive an estimate of closing costs (on the Loan Estimate (LE) form) from the lender within three days of loan application and a final disclosure of closing costs (on the CD) at least three business days before closing.

Real Estate Settlement Procedures Act (RESPA)

Which of these statements about the homeowner's rights of redemption is true? Homeowner right of redemption applies to foreclosures, short sales, and REOs. Only foreclosures are subject to homeowner's redemption rights. Right of redemption timelines are longer for foreclosures than they are for short sales. Rights of redemption with REOs may be less of a problem than with other distressed properties

Rights of redemption with REOs may be less of a problem than with other distressed properties

Why are lenders required to provide the Loan Estimate and Closing Disclosure forms to loan applicants and borrowers? Because interest rates may rise if the buyer doesn't close on time So borrowers can compare loans and make decisions regarding the affordability of loans offered So government entities can track the numbers of borrowers who decline certain types of loans So they can collect information about loan applicants and borrowers

So borrowers can compare loans and make decisions regarding the affordability of loans offered

Property taxes are calculated based on the property's __________________.

assessed value

A ____________ is most often used in tax or foreclosure sales. It generally has no expressed warranty against encumbrances but does typically imply a warranty that the grantor has title and the right to covey.

bargain and sale deed

A _________________ (title defect) is any encumbrances, such as a lien or inheritance claim, that prevents the seller from providing clear, marketable title.

cloud on title

With the __________________, the grantor holds title to and possession of the property.

covenant of seisin

A __________ is a written and signed legal instrument of conveyance. The __________ is the document that legally transfers (conveys) title to real property from the owner (grantor) to the new owner (grantee).

deed, deed

A ____________________________ (also called a full covenant and warranty deed) offers the greatest warranty to buyers and is the preferred type of deed in most situations.

general warranty deed

An _____________________ is one against which there may be known defects (such as easements), but the title company has notified the parties of the defect and has agreed to insure against it (not list it as a policy exception). As the less rigid title standard, insurable title is still acceptable to most buyers.

insurable title

A ______________ carries with it no warranties to the grantee. It only releases any of the grantor's property rights to the grantee. The quitclaim deed is typically used to clear up a simple cloud on title.

quitclaim deed

A ______________ is a property that the seller, with the lender's permission, is selling for less than the seller owes against the property.

short sale

A _______________________ typically warrants only against title defects acquired during the grantor's ownership of the property. It guarantees that the grantor owns and may convey the property, and warranties that the property is free of any debts or encumbrances not noted in the deed. A ________________________ is most often used in conveying commercial properties.

special warranty deed