Real Estate Principles and Practices Chapter 5 Estates, Interests, Deeds, and Title © 2010 by...
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Transcript of Real Estate Principles and Practices Chapter 5 Estates, Interests, Deeds, and Title © 2010 by...
Real EstateReal Estate Principles and Practices Principles and Practices
Chapter 5Chapter 5
Estates, Interests, Deeds, Estates, Interests, Deeds, and Titleand Title
© 2010 by South-Western, Cengage Learning
© 2010 by South-Western, Cengage Learning
Key TermsKey Terms
Acknowledgment
Community property
Consideration
Co-ownership
Curtesy
Deed
Dower
Estate
Fee simple
Fee simple absolute
Fee simple defeasible
Fee simple determinable
Fee simple to a condition subsequent
Freehold estate
Grantee
© 2010 by South-Western, Cengage Learning
Key TermsKey Terms
Grantor
Habendum clause
Homestead
Joint tenancy
Legal life estate
Life estate
Nonfreehold estate
Recordation
Remainderman
Reversion
Severalty ownership
Tenancy by the entireties
Tenancy in common
Title
Warranty deed
© 2010 by South-Western, Cengage Learning
Freehold EstatesFreehold Estates
Ownership for an indefinite duration
Freehold: Freehold: uncertain
Types of freehold estatesTypes of freehold estatesFee simpleFee simple
Fee simple defeasibleFee simple defeasible
Life estatesLife estates
Estate of inheritanceEstate of inheritance
Not of inheritance freehold estateNot of inheritance freehold estate
© 2010 by South-Western, Cengage Learning
Freehold EstatesFreehold Estates
Fee Simple Fee Simple title: complete rights with absolute ownership
Sell
Will
Give away
Retain possession
Subject to government and land use restrictions
© 2010 by South-Western, Cengage Learning
Freehold EstatesFreehold Estates
Qualified fee estates
Two types:
Fee simple determinableFee simple determinable
Fee simple to a Fee simple to a condition subsequentcondition subsequent
© 2010 by South-Western, Cengage Learning
Freehold EstatesFreehold Estates
Limits use to specific terms
Conditional“as long as” used for purpose granted
“qualified” the estate
Violation of the condition results in land automatically reverting to original grantor
ReversionerReversioner
© 2010 by South-Western, Cengage Learning
Freehold EstatesFreehold Estates
Violation of the condition requires court action to regain possession
© 2010 by South-Western, Cengage Learning
Life EstatesLife Estates
Granted by will or deedOrdinary life estate: based on life of life tenant
Life estate pur autre vie: based on someone else's life
Life tenant:
Must maintain the property
Pay taxes
May not commit waste
May lease
May mortgage
May sell
May not will
© 2010 by South-Western, Cengage Learning
Legal Life EstatesLegal Life Estates
Created by statuteCreated by statute
andand
© 2010 by South-Western, Cengage Learning
Legal Life EstatesLegal Life Estates
© 2010 by South-Western, Cengage Learning
Legal Life EstatesLegal Life Estates
© 2010 by South-Western, Cengage Learning
Nonfreehold EstatesNonfreehold Estates
Nonfreehold estate:Nonfreehold estate:Less than freehold
Possessory interest for a defiant period of time
Leasehold interests
© 2010 by South-Western, Cengage Learning
Nonfreehold EstatesNonfreehold Estates
Estate for yearsEstate for years
Periodic estatePeriodic estate
Estate at willEstate at will
Estate at sufferanceEstate at sufferance
© 2010 by South-Western, Cengage Learning
The DeedThe Deed
Title: Title: evidence of ownership
Deed: Deed: document used to transfer ownership
Tangible proof
Quality of the estate
Quantity and amount
© 2010 by South-Western, Cengage Learning
The DeedThe Deed
Deed gives proof of gives proof of
TitleTitle
which represents the quality of thewhich represents the quality of the
EstateEstate
© 2010 by South-Western, Cengage Learning
The DeedThe Deed
Livery of seizin: Livery of seizin: Transfer of possession
Grantor: Grantor: Seller
Grantee: Grantee: Purchaser
© 2010 by South-Western, Cengage Learning
The DeedThe Deed
Deed must be executed, delivered and accepted
Singed by Grantor
Corporations may hold title
Fictitious name
© 2010 by South-Western, Cengage Learning
The DeedThe Deed
Delivery made by the grantor during grantor’s lifetime
Third party mat accept on behalf of grantee
© 2010 by South-Western, Cengage Learning
The DeedThe Deed
Gives constructive noticeNot mandatory
County office where the property is located
Copy in book of recordsOriginal returned
Actual notice: Actual notice: actual knowledge
© 2010 by South-Western, Cengage Learning
The DeedThe Deed
Competent parties
Consideration
Words of conveyance
Description of real estate
Restrictions
Quantity or quality
Signatures of grantors
Parties: grantorgrantor and granteegranteeCompetent: Competent: capable of entering into a contract
Consideration: Consideration: price paidToken amount
“For love and affection”
Words of conveyance: Words of conveyance: grant title in the granting clause
Description: Description: identifies the real estate
Restrictions: Restrictions: “subject to…”
Qualities and quantity of the interest: Qualities and quantity of the interest: warranties
Signatures of the grantorsSignatures of the grantors
© 2010 by South-Western, Cengage Learning
Conveyance FeeConveyance Fee
State tax – varies
Usually paid by grantor
© 2010 by South-Western, Cengage Learning
Types of DeedsTypes of Deeds
Most complete ownership
Guarantees title:
Covenant of seizinCovenant of seizin
Quiet enjoymentQuiet enjoyment
Freedom from Freedom from encumbrancesencumbrances
Further assurancesFurther assurances
Right to conveyRight to convey
Covenant of warrantyCovenant of warranty
© 2010 by South-Western, Cengage Learning
Types of DeedsTypes of Deeds
Guarantees only during grantors ownership
Grantors have not encumbered the property
© 2010 by South-Western, Cengage Learning
Types of DeedsTypes of Deeds
Warranties created by the grantors
Own property
Have not previously conveyed the property
Encumbrances during the grantors ownership
© 2010 by South-Western, Cengage Learning
Types of DeedsTypes of Deeds
No warranties
Grantor has an interest in the property
© 2010 by South-Western, Cengage Learning
Types of DeedsTypes of Deeds
No warranties
Grantors “quit their claim”
Used to remove a cloud on a cloud on the titlethe title
© 2010 by South-Western, Cengage Learning
Types of DeedsTypes of Deeds
Trust DeedTrust Deed
Secures payment of a debt
Held in trust by 3rd party for the benefit of a lender
Deed of reconveyance
© 2010 by South-Western, Cengage Learning
Types of DeedsTypes of Deeds
Used to donate real property
Consideration
“for $1.00 and other valuable consideration”
“for love and affection”
© 2010 by South-Western, Cengage Learning
Types of DeedsTypes of Deeds
Deed of SurrenderDeed of SurrenderConveys interest of life tenant or remainderman
Deed of ReleaseDeed of ReleaseClears title when mortgage is paid
© 2010 by South-Western, Cengage Learning
Types of DeedsTypes of Deeds
Correction DeedCorrection DeedDeed of reformation
Corrects errors
Cession DeedCession DeedUsed by a subdivider to transfer streets to the government
© 2010 by South-Western, Cengage Learning
Types of DeedsTypes of Deeds
Sheriff’s DeedSheriff’s DeedReferee's deed
Transfers property sold at public auction
No warranties
Administrators DeedAdministrators DeedTransfers property of deceased
Referee’s deed in partition
© 2010 by South-Western, Cengage Learning
Types of DeedsTypes of Deeds
Tax DeedTax DeedTransfers property sold for unpaid taxes
Executor’s DeedExecutor’s DeedTransfers property of deceased
No warranties except for executor’s acts
States full sales price
© 2010 by South-Western, Cengage Learning
Types of DeedsTypes of Deeds
Guardian’s DeedGuardian’s DeedConveys a minor’s interst
Director’s DeedDirector’s DeedPublic agency sells surplus land
© 2010 by South-Western, Cengage Learning
Taking Title to Real PropertyTaking Title to Real Property
Ways to take title:Ways to take title:Joint tenancy
Tenancy in common
Concurrent ownership
Tenancy by the entirety
Severalty ownership
Multiple ownership
© 2010 by South-Western, Cengage Learning
Taking Title to Real PropertyTaking Title to Real Property
Acquired prior to marriage
Acquired by gift or inheritance
Each may devise their portion of the community property to anyone
© 2010 by South-Western, Cengage Learning
Taking Title to Real PropertyTaking Title to Real Property
Two or more people join in a business for the purpose of making a profit
Trade name – severalty
Individual owner names - tenants in common or join tenancy
© 2010 by South-Western, Cengage Learning
Taking Title to Real PropertyTaking Title to Real Property
HomesteadHomestead: family’s place of residence
Protection from judgments
Requirements:
Permanent residence
File as homestead
© 2010 by South-Western, Cengage Learning
Taking Title to Real PropertyTaking Title to Real Property
Claim’s which are not exempt:
Real estate taxes
Real estate special assessments
Real estate mortgages
Mechanics liens