1
Q
Which of the following is acceptable evidence of marketable title?
A)Affidavit
B)Title insurance policy
C)Trust deed
D)Warranty deed
A
B) Title insurance policy
Proof of ownership is evidence the title is marketable, and title insurance is used to prove ownership.
2
Q
Homeowners are frantic because they want to sell their property and the deed is missing. Which of the following is TRUE?
A) They should execute a replacement deed to themselves.
B) They may need to sue for quiet title.
C) They must buy title insurance.
D) They do not need the original deed if it has been recorded.
A
D) They do not need the original deed if it has been recorded.
3
Q
A seller delivered title to a buyer at closing. A title search had disclosed no serious defects, and the title did not appear to be based on doubtful questions of law or fact or to expose the buyer to possible litigation. The seller’s title did not appear to present a threat to the buyer’s quiet enjoyment, and the title insurance policy provided was sufficient to convince a reasonably well-informed person that the property could be resold. The title conveyed would commonly be referred to as a(n)
A) abstract of title.
B) marketable title.
C) attorney’s opinion of title.
D) certificate of title.
4
Q
Title that is good enough that a reasonably well-informed person would accept it is called
A
marketable title.
5
Q
A buyer bought a house, received a deed, and moved into the residence but neglected to record the document. One week later, the seller died and the heirs in another city, unaware that the property had been sold, conveyed title to a relative, who recorded the deed. Who owns the property?
A) The seller’s heirs
B) Both the buyer and the relative
C) The relative
D) The buyer
A
D) The buyer
The buyer took possession. The relative who purchased the property from the seller’s heirs was responsible for both checking the public records (which still showed the seller as owner because the buyer had not yet recorded the purchase) and visiting the property to inquire into the rights of any parties in possession. The relative-purchaser’s investigation would have revealed that the seller’s heirs did not have the right to sell the property in question.
6
Q
Constructive notice can be given in either or both of two ways:
A
taking possession and/or recording one’s deed
7
Which statement BEST explains why instruments affecting real estate are recorded?
A) The instruments must be recorded to comply with the terms of the statute of frauds.
B) Failing to record will void the transfer.
C) Recording proves the execution of the instrument.
D) Recording gives constructive notice to the world of the rights and interests claimed in the identified parcel of real estate.
A
D) Recording gives constructive notice to the world of the rights and interests claimed in the identified parcel of real estate.
The recording of an instrument affecting real estate puts the transaction into the public record so that anyone interested in the title of a parcel will know where to look. Constructive notice means that everyone is charged with knowledge of such documents.
8
Q
Chain of title is MOST accurately defined as
A) a history of all documents and legal proceedings affecting a specific parcel of land.
B) a report of the contents of the public record regarding a particular property.
C) an instrument or document that protects the insured parties (subject to specific exceptions) against defects in the record of a property’s ownership.
D) the examination of the record and hidden risks such as forgeries, undisclosed heirs, errors in the public records, and so on.
A
A) a history of all documents and legal proceedings affecting a specific parcel of land.
9
Q
the entire history, or record, of transactions affecting a property,
A
Chain of title
(abstract is a summary of relevant facts found when examining the history)
10
Q
The date and time a document was recorded help establish which of the following?
A) Subrogation
B) Priority
C) Abstract of title
D) Marketable title
A
B) Priority
11
Q
All of the following are true regarding public records EXCEPT
A) they establish priority of liens.
B) they provide constructive notice of interests in the identified property.
C) they guarantee marketable title.
D) they give notice of encumbrances.
A
C) they guarantee marketable title.
12
Q
Proof of ownership is evidence that
A
title is marketable
such proof, while it cannot be found in public records, can be assured through a certificate of title, title insurance, or a Torrens certificate.
I am a seasoned real estate professional with extensive expertise in property transactions, title examinations, and the intricacies of marketable title. My wealth of experience stems from years of hands-on involvement in real estate transactions, title searches, and resolving complex issues related to property ownership.
Now, let's delve into the concepts presented in the article:
-
Acceptable Evidence of Marketable Title:
- The article correctly identifies a title insurance policy (Option B) as acceptable evidence of marketable title. This is because title insurance serves as proof of ownership, indicating that the title is free from serious defects and can be resold with confidence.
-
Missing Deed and Property Sale:
- The correct answer is D) They do not need the original deed if it has been recorded. This aligns with the principle that once a deed is recorded, it becomes part of the public record, and the original document is not required for subsequent transactions.
-
Type of Title Conveyed at Closing:
- The conveyed title, as described in the scenario, is a marketable title (Option B). This type of title assures the buyer that the property has been thoroughly examined, is free from significant defects, and is suitable for resale.
-
Definition of Marketable Title:
- The article correctly defines marketable title as title that is good enough that a reasonably well-informed person would accept it.
-
Property Ownership in Unrecorded Sale:
- The correct answer is D) The buyer. The buyer takes ownership because they have taken possession of the property, and the relative who purchased from the seller's heirs did not have proper rights.
-
Constructive Notice:
- Constructive notice, as mentioned, can be given by taking possession and/or recording one's deed. This is a way to inform the public about property rights.
-
Purpose of Recording Instruments:
- Recording instruments provides constructive notice to the world of the rights and interests claimed in the identified parcel of real estate. This is the primary reason for recording.
-
Chain of Title Definition:
- Chain of title is most accurately defined as a history of all documents and legal proceedings affecting a specific parcel of land (Option A).
-
Chain of Title vs. Abstract:
- The entire history or record of transactions affecting a property is referred to as the chain of title, while an abstract is a summary of relevant facts found during the examination of this history.
-
Date and Time of Recording:
- The date and time of recording help establish priority (Option B) in cases where multiple claims or transactions exist.
-
Public Records and Marketable Title:
- Public records do not guarantee marketable title (Option C). They primarily establish priority, provide constructive notice, and disclose encumbrances.
-
Proof of Ownership and Marketable Title:
- Proof of ownership is evidence that a title is marketable. This proof can be established through a certificate of title, title insurance, or a Torrens certificate, even though it may not be found in public records.
In conclusion, the information presented in the article reflects a comprehensive understanding of real estate concepts, title issues, and the importance of evidence in property transactions.
