Real Estate Ch 6

Front 1

Sam sells to buyer Bob. Bob does not record the deed or take possession of the land. Sam dies and his child conveys the real estate to Anne. Anne records the deed. Who gets the property?

Back 1

Anne does. In real estate law, a purchaser has the responsibility to check public records and the land itself. If there is neither public record nor any indication of possession, then having fulfilled their legal obligations, the land belongs to them upon recording the deed publicly.

Front 2

Sam sells to the buyer Bob. Bob takes possession of the land, but does not record the deed. When Sam dies, Anne purchases the land after checking to make sure the deed is in fact in Sam's family's possession. She records the deed publicly. Who has the legal right to the land now?

Back 2

Bob. It was Anne's job to check BOTH the public records and the land itself for signs of ownership. Since she did not do BOTH, the law holds her responsible for the error. The only options she has is to try and get her money back from Sam's child.

Front 3

Sam sells to the buyer Bob. Bob records the deed properly in the county office, but he has not moved in himself. Sam wants to try and make more money before splitting town, so he also tries to sell the property to John. John sees the land is empty and doesn't want to spend the time looking up the property in the county office, trusting Sam. Does the land belong to Bob or John?

Back 3

Bob. John is the one who made the error of not checking both public record and the land. He can sue Sam for his money, if he can find him.

Front 4

Sam sells to the buyer Bob and gives Bob a signed and dated deed. Bob neither possesses the land nor records the deed. Sam then sells the same land to John, who takes takes the deed to the county office and records it. Bob's deed is dated before John's, but John recorded his publicly first. Who has the right to the land? Is Bob's signed and dated deed valid?

Back 4

Even though Bob has a signed and dated deed more recent than John's from Sam, because he did not record it or possess it, he does not have the legal right to the land over John. John has the legal right to the land since he fulfilled his obligations of checking the property for possession and checking the public records, and because he then recorded it before Bob. Whoever gets the deed to the public office first (if neither has possessed the land) has the legal ownership of the land.

However, Bob's deed is still valid between he and Sam (so he can sue Sam). It's just not valid to the public or towards John.

Front 5

When someone publicly records a deed in the county clerk's office, the document must be ___________________. What does this mean?

Back 5

Acknowledged

Essentially, notarized.

Front 6

Race to the Courthouse--first mortgagee to record gets _____________ position.

Back 6

? No idea what he is talking about.

Front 7

Are the real estate documents in public records arranged in alphabetical or chronological order? What is the weakness of this system and how have recording offices sought to better it?

Back 7

1) Chronological order

2) It could take FOREVER to find all the relevant information on a certain parcel of land. They have created grantor and grantee indexes.

Front 8

What is a Grantor/Grantee index, and what is it for?

Back 8

For each calendar year, the grantor index lists in alphabetical order all grantors named in the documents recorded that year; next to each grantor's name is the name of the grantee named in the document, the book and page where a photocopy of the document can be found, and a few words describing the document. It is a much easier way of locating relevant information for a parcel of land. You can also search by alphabetized grantees.

Front 9

What is a Tract Index?

Back 9

In a tract index, one page is allocated to a single parcel of land or a group of parcels, called a tract. On that page, there are references to all the recorded deeds, mortgages, and other documents related to that parve, along with references to the book and page for the original documents.

Front 10

Tract Indexes are most commonly used by _______________ and are not used by ___________.

Grantor/Grantee Indexes are used by __________________.

Back 10

Tract Indexes are used by title companies, but the county clerks in Texas do not use them.

Texas County Clerks' offices use Grantor/Grantee Indexes.

Front 11

With the Texas Electronic Recording Act of 2005, are traditional paper documents also recorded or is it purely electronic? Also, are "electronic signatures" used or are scanned hand-written signatures still required?

Back 11

1) Traditional paper documents are also recorded

2) Electronic signatures are allowed

Front 12

What is a Chain of Title?

Back 12

It shows the linkage of property ownership from the government all the way to the present owner with all those in-between.

Front 13

What is an Abstract of Title?

Back 13

A complete historical summary of all recorded documents affecting the title of a property.

Front 14

After the abstract of title is created by a professional, it is sent to an attorney who _______________________________.

Back 14

Renders an opinion as to who the fee owner is and if others may have a claim.

Front 15

One of the purposes of an Abstract of Title is that it determines not only who may have claim to the land but it confirms __________________________________________.

Back 15

That all mortgages, judgements, liens, and taxes have been satisfied.

Front 16

What are the three differences between Title Insurance for a Lender and Title Insurance for an Owner?

Back 16

1) Coverage: the Owner's policy is for the full amount stated on the policy, but the LP is only until the debt is paid.

2) Exceptions: Owner's policy makes exceptions for claims to ownership based on physical property inspection while lender's policy does not

3) Transferability: OP is not transferable to new owner, but LP is transferable to subsequent holders of the mortgage.

Front 17

What is the difference in cost of Lender's and Owner's Policies for Title Insurance?

Back 17

They are about the same if purchased separately, but if purchased together at the same time, the combined cost is only a bit more expensive than one policy.

Front 18

Who typically pays for Title Insurance? The Buyer or the Seller?

Is the premium for the insurance monthly, annually, or a single up-front payment?

Who sets the rates of premiums?

Back 18

1) The seller.

2) A single, up-front payment

3) ?

Front 19

What is a Title Commitment?

How much do they cost?

How quickly must they be issued from the receipt of earnest money contract?

Back 19

1) It is issued when curative requirements are satisfied to indicate the obligation of the insurer to issue a title policy (because curative requirements are satisfied).

2) They do not cost the buyer or seller anything

3) ?

Front 20

An Owner's Policy Title Insurance pays all losses on title defects if an attorney rendered an incorrect __________________.

Back 20

Opinion