Real Estate Unit 12

Covenant Against Encumbrances

In this covenant, the grantor assures that the property is free from liens or encumbrances, except for any specifically stated in the deed.

Covenant of Warranty Forever

In this covenant, the grantor promises to compensate the grantee for the loss sustained if the title fails at any time in the future.

Title

Means the right to ownership or actual ownership of the land. It represents the owners bundle of rights.

Transfer Tax

Tax stamps required to be affixed to a deed by state and/or local law.

Deed

The document by which the owner transfers the title to another. The statute of frauds requires these to be in writing. The instrument that conveys property from a grantor to a grantee.

Covenant of Seisin

The general warranty covenant that states that the grantor owns the property and has the right to convey title to it. Means "possession."

Bequest

The gift of personal property by will. Aka: legacy

Devise

The gift of real property by will.

Voluntary Alienation

The legal term for the voluntary transfer of title. The owner may voluntarily transfer by either making a gift or selling the property.

Deed in Trust

The means by which a trustor conveys real estate to a trustee for the benefit of a beneficiary.

Grantor

The owner who transfers the title to property voluntarily to someone else (the grantee).

Executor

The person who has possession of the will, who presents it for filing in court.

Testator

The person who makes a will.

Grantee

The person who receives the title to property from someone else (a grantor).

Deed Executed Pursuant to Court Order

These deeds are established by state statute and are used to convey title to property that is transferred by court order or by will. Examples: - Executors and administrators deeds - Masters deeds - Sheriffs deeds

Quitclaim Deed

This deed has no express or implied covenants or warranties. It is used primarily to convey less than fee simple or to cure a title defect (called cloud on the title). The grantor "remises, releases, and _________s" their interest in the property.

General Warranty Deed

This type of deed provides the greatest protection. The grantor is legally bound by certain covenants or promises. Contains 5 covenants.

Intestate

When a person died without a will.

Testate

When a person dies with a will.

Involuntary Alienation

When title to property is transferred without the owners consent. These types of transfers are carried out by operation of law (such as by condemnation, or a sale to satisfy delinquent tax or mortgage liens).

Will

A testamentary (takes effect only after death) instrument made by an owner to convey title to real or personal property after the owners death.

Adverse Possession

(A means of involuntary transfer. When an individual makes a claim to a certain property, takes possession of it, and uses it may take Title away from an owner who fails to use or inspect the property over a period of years.) Basically if someone is using a property that is not theirs in a way that is: - Open - Notorious - Continuous/uninterrupted - Hostile - Adverse to the true owners possession and they do that for 20 years, they have squatters rights and may be able to take the title to the property away from the actual owner.

Five Covenants (General Warranty Deeds)

- Covenant of seisin - Covenant against encumbrances - Covenant of quiet enjoyment - Covenant of further assurance - Covenant of warranty forever

Common Deed Forms

- General warranty deed - Special warranty deed - Bargain and sale deed - Quitclaim deed - Deed in trust - Trustees deed - Deed executed pursuant to a court order

Title Transfer Methods

- Voluntary - Involuntary - Will - Descent

Settlement Agent

A third party to deliver a deed to a grantee as soon as certain requirements have been satisfied. Aka: Escrow agent

Probate

A legal procedure for verifying the validity of a will and accounting for decendents assets. This process can take several months to complete. It: - Proves or confirms the validity of the will - Determines the precise assets of the deceased person - Identifies the people to whom the assets are to pass

Beneficiary

A person who receives personal property by will. Aka: legatee

Devisee

A person who receives real property by will.

Granting Clause

A clause that states the grantors intention to transfer the property. Required to be in a deed. Aka: Words of conveyance

Administrator

A court appointed representative to administer the affairs of the estate - the role usually taken by an executor. Responsible having an estates assets appraised and for ensuring that all the decedents debts are satisfied.

Covenant of Quiet Enjoyment

A covenant in which the grantor guarantees that the grantors title will be good against third parties who might bring court actions to establish superior title to the property.

Covenant of Further Assurance

A covenant where the grantor promises to obtain and deliver any instrument needed to make the title good.

Special Warranty Deed

A deed in which the grantor defends the title against themselves but not against previous encumbrances. Contains two warranties: - Warranty that the grantor received the title - Warranty that the property was not encumbered during the time the grantor held title, except as otherwise noted in the deed

Trustees Deed

A deed used when a trustee conveys real estate held in the trust to the beneficiary.

Bargain and Sale Deed

A deed with no express warranties. Implies that the grantor holds title and possession of the property. The words in the granting clause are "grant, bargain, and sell." Covenants: - The grantor holds a fee simple estate - The title is free from encumbrances made by the grantor except those listed in the deed - The grantor warrants quiet enjoyment

Acknowledgment

A formal declaration that the person who signs a written document does so voluntarily and that their signature is valid. The declaration is made before someone prescribed by law. Aka: Notarization