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


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


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


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



Fee Simple Fee Simple title: complete rights with absolute ownership

Sell

Will

Give away

Retain possession

Subject to government and land use restrictions



Qualified fee estates

Two types:

Fee simple determinableFee simple determinable

Fee simple to a Fee simple to a condition subsequentcondition subsequent



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



Violation of the condition requires court action to regain possession


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


Legal Life EstatesLegal Life Estates

Created by statuteCreated by statute

andand


Legal Life EstatesLegal Life Estates


Nonfreehold EstatesNonfreehold Estates

Nonfreehold estate:Nonfreehold estate:Less than freehold

Possessory interest for a defiant period of time

Leasehold interests


Nonfreehold EstatesNonfreehold Estates

Estate for yearsEstate for years

Periodic estatePeriodic estate

Estate at willEstate at will

Estate at sufferanceEstate at sufferance


The DeedThe Deed

Title: Title: evidence of ownership

Deed: Deed: document used to transfer ownership

Tangible proof

Quality of the estate

Quantity and amount


The DeedThe Deed

Deed gives proof of gives proof of

TitleTitle

which represents the quality of thewhich represents the quality of the

EstateEstate


The DeedThe Deed

Livery of seizin: Livery of seizin: Transfer of possession

Grantor: Grantor: Seller

Grantee: Grantee: Purchaser


The DeedThe Deed

Deed must be executed, delivered and accepted

Singed by Grantor

Corporations may hold title

Fictitious name


The DeedThe Deed

Delivery made by the grantor during grantor’s lifetime

Third party mat accept on behalf of grantee


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


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


Conveyance FeeConveyance Fee

State tax – varies

Usually paid by grantor


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



Guarantees only during grantors ownership

Grantors have not encumbered the property



Warranties created by the grantors

Own property

Have not previously conveyed the property

Encumbrances during the grantors ownership



No warranties

Grantor has an interest in the property



No warranties

Grantors “quit their claim”

Used to remove a cloud on a cloud on the titlethe title



Trust DeedTrust Deed

Secures payment of a debt

Held in trust by 3rd party for the benefit of a lender

Deed of reconveyance



Used to donate real property

Consideration

“for $1.00 and other valuable consideration”

“for love and affection”



Deed of SurrenderDeed of SurrenderConveys interest of life tenant or remainderman

Deed of ReleaseDeed of ReleaseClears title when mortgage is paid



Correction DeedCorrection DeedDeed of reformation

Corrects errors

Cession DeedCession DeedUsed by a subdivider to transfer streets to the government



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



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



Guardian’s DeedGuardian’s DeedConveys a minor’s interst

Director’s DeedDirector’s DeedPublic agency sells surplus land


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



Acquired prior to marriage

Acquired by gift or inheritance

Each may devise their portion of the community property to anyone



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



HomesteadHomestead: family’s place of residence

Protection from judgments

Requirements:

Permanent residence

File as homestead



Claim’s which are not exempt:

Real estate taxes

Real estate special assessments

Real estate mortgages

Mechanics liens

Real Estate Principles and Practices Chapter 5 Estates, Interests, Deeds, and Title © 2010 by...

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