RE unit 7-9

  1. What are the two basic types of easement and what is the difference?
    • Easement appurtenant -- attaches to the estate and transfers with it unless specifically stated otherwise in the transaction documents
    • Easement in gross -- a personal right to use that does not attach to the grantor's estate.
  2. What is a common example of an easement by necessity?
    The need for access to a property so that it is not landlocked.
  3. How are easements created?6
    • Voluntary action
    • Necessity
    • Prescriptive operation of law
    • Grant or reservation
    • Implication
    • Government power of eminent domain (condemnation)
  4. Define encroachment and give an example.
    An encroachment is the unauthorized, physical intrusion of one owner's real property into that of another. An example would be a driveway extending beyond the lot line onto the neighbor's land.
  5. How is a license different from a personal easement in gross?
    A license may be informal and is revocable at any time. Revocation of a personal easement in gross may require the death of the grantee or express release of the easement by the grantee.
  6. How are the two types of deed restriction created?
    A deed condition is created in the transfer documents. A deed covenant is created by mutual agreement of the owner and others.
  7. Most liens do not convey ownership. What is the one exception to that rule?
    A mortgage lien conveys legal title to the lender.
  8. What type of lien takes priority over all other liens?
    Real estate tax lien
  9. What factors determine lien priority?
    • The lien's categorization as superior or junior
    • The date the lien was recorded
  10. How can the priority order of a junior lien be changed?
    A lienor can change the priority of a junior lien by voluntarily agreeing to subordinate, or lower, the lien's position in the hierarchy.
  11. What is a judgment lien and how long does it last?
    A judgment lien results from a lawsuit. It attaches to real and personal property as a result of a money judgment issued by a court in favor of a creditor. It lasts for ten years and can be renewed.
  12. What is a mechanic's lien?
    If a property owner fails to pay for work performed or materials supplied, a worker or supplier can file a mechanic's lien to force the sale of the property and collect the debt.
    non-possessory interests limiting the legal owner's rights
    a right to use portions of another's property
  15. Easement appurtenant -
    • dominant tenement's right to use or restrict adjacent servient tenement; attaches to the real estate
    • easement by necessity: granted by necessity, e.g. to landlocked owners
    • party wall: negative easement in a shared structure
  16. Easement in gross -
    • a right to use property that does not attach to the real estate. Utilities or railroads are examples. Those employed to buy or sell easements in gross must be licensed or registered with TREC.
    • personal: not revocable or transferable; ends upon death of easement holder
    • commercial: granted to businesses; transferable
  17. Easement creation -
    • voluntary grant, court decree by necessity or prescription, eminent domain
    • by prescription: obtainable through continuous, open, adverse use over a period
  18. Easement termination -
    release; merger; abandonment; condemnation; change of purpose; destruction; non-use
    intrusions of real estate into adjoining property; can become easements
  20. LICENSES -personal rights to use a property; do not _____; non-transferable; revocable
    conditions and covenants imposed on a property by deed or subdivision plat
  22. LIENS -
    claims attaching to real and personal property as security for debt
  23. Lien Legal features - restrict free and clear _______; non-payment may trigger foreclosure; do not convey ownership, except for _________; attach to the property; multiple liens may attach; terminate on payment and recording
    • Ownership
    • Mortgage lien
  24. voluntary and involuntary; general and specific; superior and junior are....
    Lien types -
  25. rank ordering of claims established by lien classification and date of recording; determines who gets paid first if lienee defaults
    Lien priority -
  26. Superior liens - 3
    rank over junior liens; not ranked by recording date; real estate tax and assessment liens and inheritance taxes
  27. Junior liens -
    rank by recording date: judgment; mortgage, vendor's, utility, mechanic's, other tax liens; mechanic's lien priority "dates back" to when work or sale transpired
  28. Housing subdivision only allows homes 2000 sp ft or more. What is this ex of
    Deed restriction
  29. Ex of voluntary lien
    Mortgage lien
  30. Lien is a creditors ___)_
  31. Special assessment tax liens or mechanics liens - which takes priority
    Special assessment tax liens
  32. Deed restrictions generally concern
    How a property may be used and what structures may be built
  33. Homeowner want to give neighbor seasonal permission to cross yard to get to public park. What kind of lien or encumbrance should he use?
  34. Judgement lien against someone for debts. Which of his things can it be placed on. House, Land, car, boat
  35. Is income tax lien superior or junior
  36. One difference between a covenant and a condition is can be
    Created when there is a transfer of ownership
  37. If owner of property A has a court ordered easement to drive across property B because its the only way A can access a public road, easement is a
    Easement by necessity
  38. What would terminate an easement
    Merger of both properties
  39. 2 properties share a common wall along the property boundary. To ensure that neither owner destroys the wall, both owners should create
    A party wall easment
  40. A foreclosure finds a homeowner with the following liens; a first mortgage dating 5 years earlier, second mortgage dated 2 years earlier, an unpaid real estate tax bill for the current year, and mechanics lien for work performed 5 years ago. Who gets paid first?
    Property tax lien
  41. A company has rented a farm to film a documentary for 2 weeks. What kind of agreement is used
  42. Which gets paid first with property is sold?
    Real estate tax lien
    Federal income tax lien
    Judgement lien
    Mortgage lien
    Real estate tax lien
  43. What is the allodial system of ownership and what does this system provide individuals?
    The allodial system of ownership gives individuals the rights to own property without proprietary control by the government. It is one of the foundations under which the US was built.
  44. What does P.E.T.E. stand for? Briefly explain each item.
    • Police Power: right of governments to make laws for good of all.
    • Eminent Domain: government can buy property for public good from unwilling private owner.
    • Taxation: government can collect funds to pay for public services.
    • Escheat: government can claim ownership of property that has no legal owner.
  45. Through what means does the government exercise its power and influence?
    Legislature, planning and policymaking, regulation, exercise of police power, provision of services
  46. What type of insurance is usually required by lender when a property is located in a Standard Flood Hazard Area?
    Flood insurance
  47. Which policies are concerned with the control and supply of money for the purpose of assisting stability and growth in the economy?

    Federal monetary policies
    Federal monetary policies
  48. Which type of laws affects the activities of employers, workers, and labor unions?
    Labor laws
  49. Name the aspects of real property interests that are regulated by government.
    • the bundle of rights
    • legal descriptions
    • financing
    • insurance
    • inheritance
    • taxation
  50. Describe the kinds of interests regulated at each level of government.
    • Federal: broad standards of usage, natural disaster, environment, discrimination, land description, lending
    • State: licensing, regional usage, ownership and inheritance
    • Local: specific land use control, taxation
    • Judicial: case law and common law applications to ownership and use
  51. What type of action requires the owner to accept a “fair value” for the property and lose all other benefits of ownership?
    Eminent domain
  52. What right allows the State to take ownership of property left by an heirless and intestate deceased owner?
  53. is the right of government to make laws for the good of all.
    Police Power
  54. are examples of
    governs the real estate business and licensing
    sets regional usage standards
    state income taxation
    development and tax incentives
    eminent domain and escheat
    State regulation
  55. These are examples of ____regulations
    levies real estate taxes
    controls specific usage and zoning
    building, health, occupancy codes
    planning, schools, services
    annexation policies
  56. these regulation applies case law and common law to disputes
    Judicial regulatios
  57. Real estate license laws established by with part of government
  58. The level of government that actually levies real estate taxes
    County and loca
  59. _____ by local government is the most general and far reaching of influences on value
    Long range planning
  60. What does a title search reveal?
    Legal description of property, owners of record, outstanding liens or encumbrances
  61. What is the distinction between legal title and equitable title?
    Legal title is possessing all ownership interests to a property, while equitable title is the interest or right to obtain legal title to a property through a sale between legal owner and buyer.
  62. Give some examples of when one might own equitable title rather than legal title.
    The buyer, during the period of contract contingency; a mortgagee who has the right to execute a strict foreclosure of the mortgage property (in a lien-theory state); a mortgagor (borrower) in a title-theory state; the buyer under a contract for deed purchase until the contract is fulfilled; the holder of an option to buy.
  63. Why is "notice" important in determining who holds title to real estate?
    Ownership is a function of evidence. The best evidence is a combination of actual and constructive notice.
  64. Explain actual notice.
    Actual notice is learning something through direct experience or communication, such as seeing the direct evidence provided by a will.
  65. Explain constructive notice.
    Constructive notice is knowledge of a fact someone could have or should have obtained, such as looking through public records.
  66. Define the term marketable title.
    A marketable title is one that is so free of defects that the buyer is certain he or she will not have to defend the title.
  67. What is an abstract, and is it considered legal evidence of a marketable title?
    An abstract is a paper record of all transactions concerning a particular piece of land, including a history of ownership, liens, and encumbrances. By itself, it is not evidence of a marketable title.
  68. What is an opinion of title, and what are the steps to its creation?
    An opinion is a letter from an attorney stating the title meets all ownership needs and has no questions in its history. It is created by the attorney examining a certified abstract for missing transactions, unexplained name changes, or defects and then noting necessary actions to clear up the title.
  69. What is a break in the chain of title, and how is it corrected?
    There is an unexplained gap or break in ownership of the property, usually caused by a name change. It is corrected by a Suit to Quiet the Title.
  70. Legal title
    ownership of the bundle of rights
  71. Legal title
    possessing all ownership interests
  72. Equitable title
    a conditional right to legal title subject to an owner's agreements with buyers and creditors
  73. actual notice:
    knowledge acquired or imparted directly through demonstrable evidence, e.g., presenting or inspecting a deed, visiting a party in possession
  74. constructive notice:
    knowledge one could, or should, have obtained, as presumed by law; imparted by recording in public records "for all to see"
  75. marketable title –
    free and clear and reasonable free from risk of litigation of defects
  76. cloud –
    defect that turns up in title commitment but not identified in sales contract
  77. patent defect –
    obvious and can be seen by knowledgeable person
  78. latent defect –
    not obvious and could not be identified even by knowledgeable person
  79. paper record of all transactions concerning a particular piece of land
    history of ownership, liens, and encumbrances
    must be certified to date of sale
    is not alone legal evidence of marketable title
    rarely used today due to bulk, age, fragile condition, and need to move them from office to office
  80. letter from attorney who has examined the abstract and deems the title as meeting all ownership needs with no questions in its history
    abstract and opinion together DO NOT protect against forged documents, rights of any parties in possession, and anything that has not been recorded
  81. successive property owners from original grant to present owner
    break in chain corrected by Suit to Quiet the title or Quitclaim
    Chain of title
  82. legal method for registration of property
    verifies ownership and encumbrances
    Torrens Certificate is the title itself, not just evidence of title
    Land held under Torrens registration is not subject to claims of adverse possession
    torrens system
  83. If john records the deed of conveyance, he has imparted and bob has received what type of notice
    Legal notice
  84. A quitclaim deed from the previous owner to the grantor corrects what
    Minors clouds on the title
  85. Why are abstracts rarely used as evidence of title today
    They’re fragile and bulky
  86. A road easment is an example of
    An emcumbrance
  87. Serious gaps in the chain of title must be resolved via court action in a lawsuit to
    Quiet title
  88. Collection of rights that a person has in the ownership of real property
  89. A person who owns the complete bundle of rights to property holds what
    Legal title
  90. What action identifies if any liens on property
    Title search
  91. Evidence of title allows a buyer to determine
    What rights or interests are being conveyed before the actual conveyance
  92. An instrument that records the history of the property is called
    Abstract of title
  93. Where would one fine information based on constructive notice
    Court house records
  94. Question of who owns title to a property is generally a function of
    Who has the best evidence of ownership
  95. To avoid situation under caveat emptor, the buyer is charged with the responsibility of
    Actual and constructive notice
  96. A title search does not reveal
    History of all owners of property
  97. The right to obtain legal title to a property in accordance with a sale between the legal owner and a buyer is called
    Equitable title
Card Set
RE unit 7-9