FIn 3305 Real Estate Exam 2

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.

Dedication of land

When a developer sets aside a portion of the land for common area, parks, or sidewalks. - land is gifted from owner to the public - public is responsible for maintaining the land NOTE: There are "dedicated" streets on old subdivision maps which were never officially accepted and, in effect, belong to no one.

Deed

Written legal document that transfers ownership of real property amongst parties

Testator/Testatrix

a person who makes a will

Adverse Possession

acquisition of land through prolonged and unauthorized occupation - method of acquiring title by pocessing land for a specified period of time under certain conditions

accretion

acquring natural land via lake, river, or ocean due to gradual accumulation of rock, sand, and soil

Right to cancel timeshare

any purchaser can cancel contract for timeshare interest before 6th day after contract signed

Dedication by deed

developer prepares a deed that identifies the streets and grants them to the city

Unit Deed

each purchaser receives deed

List types of leasehold estates

estate for years, periodic estate, estate at will, and tenancy at sufferance

Gross lease

flat rent; rentals paid in leases that don't change during the term

Covenants

legally binding promises for which the grantor becomes liable that are in writing

Land description

metes and bounds, rectangular survey, lot block and track

Lessor

owner; landlord

Texas Timeshare Act

regulates the creation and sale of timeshare interests in development properties - Real estate license required to market unit, unless otherwise exempt - register property with TREC - grants power to investigate all aspects of the dev to TREC

Statute of Frauds

requires that transfers of real estate ownership be in writing and signed in order to be enforceable in a court of law.

Fee Simple Timeshare

right to fee ownership of 1-2 weeks each year into perpetuity (no maturity date)

Estate for years

specific starting and ending date

Under TX laws, when someone dies, testate or intestate, that person's real or personal property passes to ____

the person's heir or beneficiaries

Probate Court

where deceased's will must be filed with court having power to admit and certify wills - checks validity of will - properly signed, witnessmed and testator was of sound mind when he did will

formal will

written document prepared in most cases by an attorney

Periodic estate

•one that renews itself automatically

Reversion define:

•right of owner to retake possession at end of lease period. (owner doesn't want reversion, they want the lease to renew for the lessee)

Lease

•written legal document conveying a possessory interest in RE from lessor to lessee - both a conveyance and contract

Option clause

(for tenant) The right at some future time to purchase or lease a property at a predetermined price

Guardian's deed

- Used to convey a minor's interest in real property - Deed must state legal authority that permits the guardian to convey the minor's property

Reversion

- can occur when deed contains a condition or limitation - if the condition is breached, the grantor can reacquire title

Sheriff's deed or trustee's deed

- in event of a foreclosure is issued to the new buyer when a person's real estate is sold as the result of a mortgage or other court-ordered foreclosure sale - carries 1 covenant

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." · Grantee can protect against gap in warranty by buying title insurance

codicil

A written supplement or modification to a will. A codicil must be executed with the same formalities as a will.

Seperate Elements

Areas in the condominium that are exclusively owned and used as fee simple estate

condominium conversion

Changing the ownership of an existing building (usually a rental project) to the condominium form of ownership.

Gift deed

Created by simply replacing the recitation or money and other valuable consideration with the statement, "in consideration of his love and affection

Real Property that is willed is called

Devise, recipient, a legatee

Testate

Dying with a valid will

Who executes the deed by signing it?

Grantor

What Makes a Written Doc a Deed?1. Identify the _______ & the ______2. Must state _________3. Words of _______4. Land description that cannot be _________5. Grantor executes deed by _______ it

Grantor, Grantee, Consideration, Conveyance, misunderstood, signing

Cooperative apartments

Organized by forming a non-profit corporation

Testator or testatrix

Person who made the will and names the persons or organizations who are to receive the property.

Escalation clause

Provision in a lease for upward and downward rent adjustments.

Net lease rent

Rentals that are paid to the landlord; the tenant pays all expenses (property tax, insurance, repairs, utilities)

Uniform Condominium Act

Requires seller to furnish copies of bylaws / rules and regulations of the association for buyers review. You have 5 days to review and this should be given before the offer

What are the fastest ways to accomplish the transfer of title in a dedication case?

Statutory dedication or dedication

Quitclaim Deed

- A deed to relinquish any interest in property which the grantor may have, without any warranty of title or interest. - a legal instrument used to convey whatever title the grantor has; it contains no covenants or warranties, nor implication of grantor's ownership

Public Grant (patent)

- A transfer of land by a govt body to private individual - Some plausible but not completely clear-cut indication of ownership rights

Adverse Possession Requirements

- Actual - Exclusive - Open and notorious - Hostile - Continuous for statutory period

Date and Acknowledgment

- Deed has the date it was executed by grantor, but not essential to deed's validity - Acknowledgment: the grantor appears before a notary public and formally declare that he signed the deed as a voluntary act - Not necessary in Texas to make deed valid conveyance

Types of Deeds

- General warranty deed - Special Warranty Deed - Bargain and sale deed - Quitclaim deed

Owners' association (condo vs coop)

- HOA can control how coop uses property - coop HOA has right to accept or reject new shareholders and sublesses

Timesharing

- Method of dividing up and selling a living unit at a vacation facility for specified lengths of time each year - exclusive use of a property for a specfied number of days in a year

Possible problems with condominium converision

- tenants who are forced to move out of building during conversion - the condo was not originally a condo, was converted. (structure issues)

· Correction deed or deed of confirmation

-Used to correct an error in previously executed and delivered deed Ex: misspelling of name

Upon the death of a spouse in a community property passes to the surviving spouse if: what conditions are met?

1. no children 2. if all surviving children of the deceased spouse are also children of the surviving spouse

Adverse possession types

3year, 5year, 10year, 25year

Alienation

A change of ownership of real property -voluntary: deed or will -involuntary: adverse possession, natural causes ex: involuntary: foreclousre

Color of title

A consecutive chain of transfers down to the person in possession.

General Warranty Deed

A deed in which the grantor fully warrants good, clear title to the premises. Used in most real estate deed transfers, a general warranty deed offers the greatest protection of any deed.

Proprietary lease

A lease issued by a cooperative corporation to its shareholders. - tenant is also owner in building

Tenancy at Sufferance

A tenancy that occurs when a tenant that is supposed to vacate does not, but continues to pay rent, and the landlord accepts it. holdover tenant

Holographic Will

A will written entirely by the testator with his own hand with no witnesses -legal in 19, 31 states don't recognize it

Delivery and acceptance

Actual delivery of the deed by the grantor and either actual or implied acceptance by the grantee. · Deed does not transfer title to the grantee until grantor voluntarily delivers it to grantee and grantee willingly accepts it

Condominium and Cooperative Abuse Relief Act

Allows unit owners to terminate certain management contracts or portions thereof that were created while developer was in control of project

Results of Accretion are known as

Alluvion and reliction

Easement by Prescription

An easement acquired by continuous, open, and hostile use of the property for the period of time prescribed by state law. The use of must occurred over a period of 10 years

Transfer on Death Deed

Enabled by Texas Legislature as means to transfer title to property upon death

Covenant against encumbrances

Estate is free and clear of all encumbrances, except those specified upon execution of the deed

Other types of deeds

Gift deed, Guardian's deed, Sheriff's deed or trustee's deed, Correction deed or deed of confirmation, Tax Deed, Transfer on death deed

Covenant of Seisen

Grantor has not conveyed the same estate in any form previously to anyone but the grantee

executor's

If the testator owned real property, its ownership is conveyed using an ________ deed prepared and signed by the executor

Condominiums

Individual ownership of airspace and undivided ownership of common elements

Planned Unit Development (PUD)

Individually owned lots and houses with community ownership of common areas -ownership of land by unit owner - used for both condos, townhouse development

cooperative apartment (co-op)

Land and building owned or leased by a corporation which , in turn, leases space to its shareholders - can legally discriminate

Bylaws

Rules that govern how the HOA will be run

Tittle by descent or intestate succession

State law directs how the deceased's assets shall be distributed if she is intestate

Ownership by Accession

The altering of one's ownership of real estate caused by man-made or non man-made causes ex: home nearby ocean loses land bc ocean level is higher

Grantor

The individual who conveys the ownership rights of real property - the person giving up ownership - grantor must be of legal age and sound mind

Grantee

The person acquiring ownership from grantor

Tax Deed

Used to convey title to property that has been sold by the state or local government because of the nonpayment of real property taxes

oral or nuncupative will

Will that is spoken by a person who is very near death. Promptly put in writing.

condominium declaration

a document that converts a given parcel of land into a condominium subdivision

Cooperator

a shareholder (purchaser) in a cooperative apartment

Warranty

an assurance or guarantee that something is true as states

Common elements

areas owned by all the unit owners -common areas: lobby, hallways, stairways, elevators, pool, gym

Limited Common Elements

common elements whose use is limited to certain owners - ex: exclusive parking lot

Statutory dedication

developer prepares a map showing the streets, has a map approved by local government officials and then records it as a public document

Intestate

dying without a valid will

Step-up or graduated rental

escalations in leases the provide for reimbursement to the landlord for increases in expenses and costs

Covenants, Conditions, and Restrictions (CC&Rs)

filed list of restrictions by which all owners must abide

Lessee

tenant

Estate at will

terminated any time by either party

Grant

the act of conveying ownership

Alluvion

the increase of land that result when waterborne soil is gradually deposited to produce firm dry ground. slow accretion or erosion of soil, sand, and other parts of land.

Undivided Interest

two or more persons have an interest in a property held under the same title

Reliction (or dereliction)

when a lake, sea, or river permanently recedes, exposing dry land

Dedication

when an owner makes a voluntary gift for the use of land to the public

8 Conditions of Deed/ Title Transfer

§ In writing § Identify grantor and grantee § Grantor must be of legal age and sound mind § Identify property § Contain words of conveyance § State that consideration was given § Signed by grantors only to execute deed § Delivery and acceptance of deed (generally when deed recorded)

Bargain and Sale Deed

· a deed that contains no covenants, but does imply that the grantor owns the property being conveyed · Since there is nothing in writing, there is no assurance that the grantee acquired the title

Consideration

· anything of value given to induce another to enter a contract · if conveyance is gift, then consideration is not required

Legislation Against Abuses

• Uniform Condominium Act • Conversions (from apartments) • HOAs • Cooperative Apartments • Timesharing

Right-to-use timeshare

•contractual right to occupy a living unit for 1-2 weeks a year for 20-40 years