Deck 49: Transfer and Control of Real Property

Question 1

A special warranty deed will give the buyer better rights against the grantor (seller) than a general warranty deed.

Answer 1

False

Question 2

If there is a defect in title, the courts will not allow the buyer to refuse to go through with the purchase.

Answer 2

False

Question 3

Murphy and her child, who are both Caucasian, are seeking an apartment.Murphy is not married and never has
been.Grant owns an apartment complex with 8 units ready to rent.Grant will not be violating any laws by his refusal to rent to Murphy and her child on the basis that Murphy is a single, unwed mother.

Answer 3

False

Question 4

If Bob's mortgage debt is greater than the amount for which his farm is sold in a foreclosure action, he is excused from payment of the remainder.

Question 5

A minority of states have adopted the common law lien theory of mortgages which gives the mortgagor the right of ownership and possession.

Question 6

When the power of eminent domain is exercised, the owners must be given the fair market value of the property as of the time of the taking.

Question 7

The UCC applies to real estate mortgages and trust deeds since they are security interests.

Question 8

General contract law provisions govern the sale of real property.

Question 9

A deed is not effective to transfer title to land until delivery.

Question 10

If Connie buys the real estate subject to an existing mortgage, she will have to pay the mortgage if the mortgagor does not.

Question 11

A deed of trust differs from a mortgage in that the former conditionally conveys the property to a trustee for the creditor's benefit.

Question 12

To be effective, a deed need not be conveyed for consideration.

Question 13

A majority of jurisdictions follow the common law rule that the risk of loss or destruction of real property rests with the seller until the deed is conveyed to the purchaser.

Question 14

A warranty deed by Arthur to Bob includes Arthur's promise that he will be liable to Bob for any defects in title.

Question 15

Most states have adopted the theory that a mortgage is a lien on real property for the payment of a debt.

Question 16

The validity of zoning is based on the police power reserved to the states.

Question 17

Eminent domain does not grant the government power to take private land for public use.

Question 18

Foreclosure may be exercised only by sale under judicial decree.

Question 19

Foreclosure is the mortgagee's right to sell the property to satisfy the debt.

Question 20

Giving a deed to an escrow agent may be sufficient delivery of a deed.

Question 21

A mortgagee cannot assign a mortgage without the consent of the mortgagor.

Question 22

The exemption from application of the Fair Housing Act applies to single-family homes owned by private individuals who own fewer than four houses.

Question 23

A restrictive covenant stating that a house cannot be sold to someone who is not of the Caucasian race will be upheld by the courts.

Question 24

Title insurance protects an owner of real property from losses due to defects in title, liens, or encumbrances.

Question 25

A title search guarantees rightful ownership.

Question 26

The debtor who grants a mortgage is the mortgagee.

Question 27

The Fair Housing Act exemptions do not apply to discrimination based on race or color.

Question 28

A special warranty deed limits the warranty given out by the grantor to acts or omissions of the grantor.

Question 29

A variance may be granted to permit deviation from a zoning ordinance where the application of the ordinance to specific property would cause its owner particular hardship unique to the property.

Question 30

One common type of restrictive covenant restricts the use of property to residential purposes.

Question 31

Title insurance is unnecessary if a title search is made.

Question 32

Someone who expressly assumes a mortgage is personally obligated to pay it.

Question 33

Darren grants a quitclaim deed to some property to Floyd.Now Floyd has found that someone else has a life estate in the land.Darren has breached the warranty of title.

Question 34

The warranty of habitability benefits only the original purchaser of a house.

Question 35

Recording of a deed is necessary to pass title from the grantor to the grantee.

Question 36

An uncommon but possible way to obtain title to property is by adverse possession.

Question 37

If a zoning restriction causes a financial loss to a property owner, this amounts to a taking of property and the local government will have to compensate the landowner for his loss.

Question 38

The Mortgage Reform and Anti-Predatory Lending Act of 2010 modifies the Sarbanes-Oxley Act by making those who obtain mortgages more accountable for their actions.

Question 39

The Fair Housing Act prohibits discrimination based on race and color only.

Question 40

A restrictive covenant can bind only the original parties to it.

Question 41

In a quitclaim deed, the grantor warrants that:

A)he has no knowledge of any encumbrances.
B)he himself has not impaired title to the land.
C)the land passes with no impairment of title.
D)he is conveying whatever interest he has in the land.

Question 42

Under notice-race statutes, a subsequent purchaser of real estate will prevail if he or she:

A)records the deed first.
B)takes without actual knowledge of a prior unrecorded conveyance and records the deed first.
C)takes with actual knowledge of the prior conveyance and records first.
D)secures a guarantee of indemnification against title defects from the seller and records the written document first.

Question 43

Alice purchases Bob's house and in so doing assumes the mortgage.Which of the following is/are true?

A)Only Alice is personally liable to pay the mortgage.
B)Bob and Alice are both personally liable to pay the mortgage.
C)Only Bob is liable to pay the mortgage.
D)Bob is only liable if Alice defaults.

Question 44

The characteristics of a special warranty deed include:

A)the grantor warrants the title so far as it concerns his acts or omissions.
B)the grantor warrants the title to be free of defects caused by acts or omissions of others.
C)a general warranty of title.
D)All of these.

Question 45

The covenant of title made by a grantor in a deed is also known as the covenant of:

A)seisen.
B)quiet enjoyment.
C)no encumbrances.
D)undisturbed possession.

Question 46

A buyer's remedies for breach of a contract for the sale of land include all but which of the following:

A)rescission and restitution.
B)damages for loss of the bargain.
C)specific performance with a price reduction.
D)All of these remedies are available.

Question 47

Most zoning ordinances provide that a nonconforming use may be terminated:

A)immediately.
B)after 6 months of the structure's future useful life.
C)when a nonconforming structure is destroyed or substantially damaged.
D)All of these.

Question 48

Which of the following is NOT essential to a valid deed?

A)Grantor
B)Grantee
C)Delivery
D)Recording

Question 49

In a state that adopts the lien theory regarding mortgages, the borrower would have the right to:

A)burn down the barn.
B)live on the land after default.
C)possess the land after foreclosure.
D)refuse to discharge a prior lien.

Question 50

Jan owns lots in the Cruz neighborhood, where she was planning to build an 8-story apartment complex.Cruz has adopted a single-family dwelling ordinance that encompasses Jan's lots.Jan goes to the library and finds she can attempt to get judicial review of ordinances based on which of the following?

A)The zoning ordinance is invalid.
B)The ordinance bears no reasonable relation to public health, safety, morals, or welfare.
C)The ordinance amounts to confiscation of property.
D)All of these.

Question 51

The Wall Street Reform and Consumer Protection Act of 2010 requires all but which of the following in relation to mortgages?

A)That lenders ensure a borrower's reasonable ability to repay the loan.
B)That subprime mortgages not be issued.
C)Disclosure of the maximum amount a consumer could pay on a variable rate mortgage.
D)Expanded protection for borrowers of high-cost loans.

Question 52

Eminent domain would permit condemnation of land for all the following purposes except:

A)constructing a railroad bridge over a river.
B)building senior citizens' center.
C)building a store.
D)building a post office.

Question 53

If Stan's land is condemned in order to build a subway system for the city, he must be given:

A)the fair market value of the property.
B)equivalent property.
C)the option of keeping the property.
D)his price for the property.

Question 54

The seller's warranty that he has marketable title to the land would be breached if the buyer discovers:

A)a lien on the land.
B)a defect in the chain of title.
C)a lease on the premises.
D)All of these.

Question 55

A contract agreeing to indemnify the insured against certain specified defects in title to real property is called:

A)title insurance.
B)a warranty deed.
C)guarantee insurance.
D)a real estate guarantee.

Question 56

The power to convert private property to public use is known as:

A)allocation.
B)eminent domain.
C)after-acquired title.
D)enabling.

Question 57

In order for a deed to be effective, it must contain all of the following except:

A)a description of the land.
B)a description of the consideration.
C)the signature of the grantor.
D)language conveying title.

Question 58

A chronological report of recorded transfers and encumbrances to the property can be obtained by a(n):

A)warranty deed.
B)title search.
C)attorney's opinion.
D)assumption of a mortgage.

Question 59

The time for conveyance of a deed is called the:

A)zoning meeting.
B)closing.
C)title search.
D)recordation.

Question 60

The right of redemption would require:

A)a court order.
B)assent of all parties.
C)payment of the entire debt with interest.
D)payment of past due installments.

Question 61

A buyer of real estate subject to a mortgage who does not undertake any personal liability for payment of the mortgage debt:

A)takes the property "subject to" the mortgage.
B)"assumes" the mortgage.
C)can only obtain a quitclaim deed.
D)can only obtain a leasehold.

Question 62

Zoning ordinance variances:

A)are usually available for hardships caused by the actions of the property owner seeking the variance.
B)are available if it affirmatively appears that the property as zoned cannot yield a reasonable return on the owner's investment in the property.
C)are available for hardships caused by the variance that are common to the zoned area.
D)All of these.

Question 63

A real estate conveyance is governed by the:

A)statute of frauds.
B)financial decisions of the lender.
C)terms of the mortgage.
D)law of secured transactions.

Question 64

Ellen's driveway is actually on Richard's land, but in 20 years nobody has ever said anything to Ellen about it.When Richard sells his house, a survey shows the problem and the new owner demands that Ellen abandon use of the driveway.Will she have to move her driveway?

A)Yes, if she does not actually own the land
B)Yes, since it is not in her deed
C)Not if she used it continuously
D)Not if she got permission from Richard

Question 65

Susan bought Green Acre subject to a $500,000 mortgage granted by Joe to First Bank.If Joe leaves for Bolivia and does not pay the mortgage, which of the following is true?

A)Susan will not have to pay the $500,000.
B)Susan will lose the land to First Bank (up to $500,000 value).
C)Both of these are correct.
D)None of these are correct.

Question 66

Marian lives in a "notice-race" state.She buys Blackacre from Robin but fails to record her deed.Robin then sells Blackacre to John, who also forgets to record.If Marian realizes her mistake and then records the deed, who will own title to the land?

A)John, since he had no notice.
B)John, since he purchased in good faith.
C)Marian, because she was first to file.
D)Marian, because she bought the property first.

Question 67

The doctrine declaring that the mortgagee's interest in the property is limited to the amount of the outstanding obligation is known as:

A)adverse possession.
B)the title theory.
C)the lien theory.
D)equity of redemption.

Question 68

Debra buys land from Oscar, relying upon a mortgage release executed and recorded by the mortgagee, Keith. Keith, however, had previously assigned the mortgage to Andrew who failed to have the assignment recorded.In this case, Andrew has:

A)no claim against the property in the absence of Debra's actual knowledge of the assignment by Keith.
B)no claim against the property because a mortgagee has no right to assign the mortgage to another person.
C)a claim against the property because the assignment to him took place before Debra's purchase of the land.
D)a claim against the property because recording is not necessary to the effectiveness of a mortgage assignment.

Question 69

Which of the following is INCORRECT regarding zoning?

A)Zoning can be used to regulate private property, but not to "take" it.
B)A variance permits an otherwise impermissible use of the property.
C)A zoning ordinance needs no reasonable relationship to public health, safety, or morals to be upheld.
D)A nonconforming use may be permitted where property was so used prior to adoption of the zoning ordinance.

Question 70

A transaction involving real estate whereby one party deposits a deed or money with a third party who holds the deed or funds until the happening of an agreed-upon event is called a(n):

A)adverse possession.
B)escrow.
C)foreclosure.
D)abstract of title.

Question 71

An action through which the mortgage holder takes the property from the mortgagor, ends the mortgagor's rights in the property, and sells the property to satisfy the debt is known as:

A)foreclosure.
B)equity of redemption.
C)adverse possession.
D)an executed deed of trust.

Question 72

Which of the following would be an invalid restrictive covenant in a deed?

A)A requirement that all buildings are of a certain style
B)A requirement that all homes contain a double garage
C)An agreement not to sell to African-Americans
D)An agreement requiring a minimum size for homes

Question 73

An instrument representing an interest in real property created to secure repayment of the debt is called a:

A)warranty deed.
B)foreclosure.
C)mortgage.
D)default judgment.

Question 74

Marketable title means that the title is free from which of the following?

A)Encumbrances
B)Defects in the chain of title appearing in the land records
C)Events depriving the seller of title
D)All of these.

Question 75

Stan has agreed to sell a warehouse to Ed for $150,000.The contract says that Stan will convey to Ed whatever interest he has in the property, but does not state that he has any interest.Ed is to receive a(n) deed.

A)insurable
B)quitclaim
C)general warranty
D)special warranty

Question 76

A doctrine allowing a mortgagor who has defaulted to regain her property prior to its sale by paying the debt in full with interest is known as:

A)rehabilitation.
B)the covenant of quiet title.
C)foreclosure.
D)the right of redemption.

Question 77

Which of the following may transfer title to land?

A)Deed
B)Will, or by the law of descent upon the death of the owner
C)Open, continuous, and adverse possession by a nonowner for a statutorily prescribed period of years
D)All of these.

Question 78

In order for a deed to be effective between the purchaser and the seller of real estate, the deed must:

A)be in writing and signed by both parties.
B)include the actual sale price.
C)be recorded pursuant to the state statute.
D)be delivered to the buyer by the seller with the intent to transfer title.

Question 79

The elements of adverse possession include:

A)open, constructive, and with permission of the true owner.
B)open, visible, under color of title, and with permission of the true owner.
C)secretive, invisible, hostile, and under claim of right.
D)continuous for the statutory period, open, actual, and adverse.

Question 80

Which of the following is not true regarding the warranty of habitability?

A)It is an implied warranty.
B)A majority of states hold that a builder-seller impliedly warrants a newly constructed house to be free of latent defects.
C)In the majority of states, the buyer must inspect the property thoroughly before completing the sale, as any defect discovered only after the transaction is complete would not be the seller's responsibility.
D)Many jurisdictions now require all sellers to disclose hidden defects that materially affect the property's value and that would remain undetected following a reasonable examination.