Real Estate Salesperson Exam (National Portion) Deeds, Title Transfer, and Recording Summary

A general warranty deed has the most covenants (promises), such as seisin, quiet enjoyment, against encumbrances, and warranty forever. The seller defends title against claims from any time in the past.

Wrong choices

• Quitclaim deed: A quitclaim deed makes no warranties at all.
• Special warranty deed: A special warranty deed covers only the time the seller owned the property.
• Bargain and sale deed: A bargain and sale deed implies the seller holds title but makes few or no warranties.

A quitclaim deed gives up any interest the grantor might have, without promising that the grantor has any. It is often used to clear a cloud on title or to transfer between family members.

Wrong choices

• General warranty deed: A general warranty deed has the most warranties.
• Special warranty deed: A special warranty deed warrants title during the seller's ownership.
• Trustee's deed: A trustee's deed is used by a trustee and normally recites the trustee's authority.

Constructive notice means the law treats everyone as knowing what is in the public records, whether they looked or not. Actual notice is what a person really knows, such as seeing someone living in the property.

Wrong choices

• Actual notice to everyone: Actual notice is knowledge a person really has, such as from seeing something.
• A guarantee that the title is free of defects: Recording does not guarantee title; title insurance protects against defects.
• Validity to an otherwise invalid deed: Recording cannot make an invalid deed valid.

A valid deed must be in writing, name a competent grantor and an identifiable grantee, have a legal description, words of conveyance, consideration, the grantor's signature, and be delivered and accepted. Recording is not needed for validity but gives public notice.

Wrong choices

• The signature of the grantee: Usually only the grantor signs the deed.
• Recording in the public records: Recording protects the buyer but is not required for the deed to be valid between the parties.
• A statement of the exact purchase price: A deed needs consideration but not the exact price.

A deed does not transfer title until it is delivered by the grantor (with the intent to transfer) and accepted by the grantee. Acknowledgment before a notary lets the deed be recorded.

Wrong choices

• Signed by the grantor: Signing alone does not transfer title; the deed must be delivered.
• Recorded: Recording gives notice but title passes on delivery and acceptance.
• Notarized: An acknowledgment allows recording but does not itself transfer title.

The chain of title is the sequence of ownership from the original source to the present owner. An abstract of title is a summary of the recorded documents. A gap in the chain may need a quiet title action.

Wrong choices

• Title insurance policy: A title policy insures against defects; it is not the history itself.
• Certificate of occupancy: A certificate of occupancy states a building is fit to occupy.
• Plat map: A plat map shows lots and blocks in a subdivision.

Title insurance pays for covered losses from title defects, including hidden risks like forgery that a search may not find. An owner's policy protects the buyer; a lender's (mortgagee's) policy protects only the lender.

Wrong choices

• A recorded quitclaim deed from the buyer: The buyer quitclaiming would give away the buyer's own interest.
• The lender's title insurance policy: A lender's policy protects only the lender up to the loan balance.
• An attorney's opinion of title: An attorney's opinion can be wrong and does not pay claims like insurance does.

Adverse possession is a form of involuntary alienation. The possessor must use the land openly, notoriously, hostilely (without permission), exclusively, and continuously for the time set by state law. A quiet title suit often confirms the new title.

Wrong choices

• Escheat: Escheat gives property to the state when there are no heirs.
• Eminent domain: Eminent domain is a government taking for public use.
• Devise: A devise is a gift of real property by will.

A cloud on title is any claim or document that may weaken the owner's title. It can often be removed with a quitclaim deed from the person who may have the interest, or by a court quiet title action.

Wrong choices

• Constructive notice, which has no effect on title: An unreleased interest is a defect that must be cleared.
• Easement appurtenant that runs with the land: Nothing suggests an easement.
• Lis pendens that the buyer can ignore: A lis pendens is a notice of a pending lawsuit; it cannot be ignored either.

Transferring real property by will is a devise, and the person who receives it is the devisee. When someone dies without a will, the property passes by intestate succession under state law.

Wrong choices

• Bequest: A bequest is a gift of personal property by will.
• Escheat: Escheat is a transfer to the state when there is no will and no heirs.
• Intestate succession: Intestate succession is transfer when there is no will.