PSI Broker Exam Prep: Transfer of Title. Top Exam Questions and answers, rated A+

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PSI Broker Exam Prep: Transfer of Title. Top Exam Questions and answers, rated A+ Select the statement that accurately depicts property ownership income tax implications. During the ownership sta... ge, both investors and homeowners may be able to deduct mortgage interest paid. Ari owned acreage in a rural area. He sold a small portion of it to a neighbor in an informal transaction but made no record of the sale or change of ownership. A developer offered Ari several million dollars for the entire acreage, and Ari eagerly accepted the offer. What covenant is Ari in danger of violating? Seisin 00:0201:23 Which one of the following is a characteristic of an abstract of title? It provides an attorney’s opinion of the title. How might the lengthy purchase process for a short sale or foreclosure impact a buyer’s financing? An existing interest rate lock may expire before the transaction is ready to close. Roy purchased a newly constructed home with a warranty that covers major structural defects for 10 years, and systems (HVAC, electrical, plumbing) for three years. After living in the home a few months, Roy notices the following defects and submits them all. Which one will likely be covered by the warranty? A split ceiling joist in the basement Which one of these is a potential title issue with a foreclosure? Clouds on title Lawrence is a buyer closing on a home purchase for which he's obtaining financing. He receives a Loan Estimate from his lender. What's one purpose of this document? To provide the estimated closing costs for Lawrence's loan Stu is buying Freddie’s property. What must occur for the transfer of title to take place? Freddie must intend to convey the property to Stu. Li Meng purchased a property that had been owned by the same man for more than 40 years. The title search was clean. In the spring, she started seeing traffic on the path to her dock and discovered that the previous owner had always allowed the locals to use his path to get to the lake. What covenant may have been breached? Against encumbrances title insurance company The"______" performs a search of public records in an attempt to discover any potential claims against the property and issues a preliminary report (also called a title commitment) that’s a promise to insure the property as long as certain conditions are met. title abstract (abstract of title) A "______" is a summary of the property’s title history. chain of title establishes the path of property ownership from its first owner to the current owner. 00:0201:23 marketable title has no defects or clouds to which a reasonable buyer would object. It’s not necessarily a perfect title. insurable title one against which there may be known defects (such as easements), but the title company has notified the parties of the defect and has agreed to insure against it (not list it as a policy exception) cloud on title (title defect) any encumbrances, such as a lien or inheritance claim, that prevents the seller from providing clear, marketable title. seller’s existing mortgage lien The most common title defect in a real estate transaction is the "_____" general warranty deed (general warranty deed) offers the greatest warranty to buyers and is the preferred type of deed in most situations. Covenant of seisin The grantor holds title to and possession of the property Covenant of right to convey The grantor has the right to convey both title to and possession of the property. Covenant against encumbrances The grantor assures the grantee that there are no encumbrances against the title other than those identified in public records or the deed itself. Covenant of quiet enjoyment The grantor assures that the grantee’s use and enjoyment of the property will be unimpaired and unrestricted, subject to public police powers and private deed restrictions. Covenant of further assurances The grantor promises to take whatever actions necessary (within his power) to correct any title defects. Covenant of warranty or warranty forever In this most important covenant, the grantor promises to protect and defend the title against lawful claims made by others. special warranty deed A "_____" typically warrants only against title defects acquired during the grantor’s ownership of the property. It guarantees that the grantor owns and may convey the property, and warranties that the property is free of any debts or encumbrances not noted in the deed bargain and sale deed A "_____" is most often used in tax or foreclosure sales. It generally has no expressed warranty against encumbrances but does typically imply a warranty that the grantor has title and the right to covey. quitclaim deed A "____" carries with it no warranties to the grantee. It only releases any of the grantor’s property rights to the grantee. The quitclaim deed is typically used to clear up a simple cloud on title. deed in trust (or deed of trust) A "_____" conveys real estate to a trustee for the be [Show More]

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