Chapter 6—Recordation, Abstracts, and Title Insurance
MULTIPLE CHOICE
1. An instrument effecting the title to a parcel of real estate gives constructive notice to the world when it
is recorded with the
a.
county recorder.
b.
city clerk.
c.
real estate commissioner.
d.
title insurance company.
2. A public records office will record which of the following documents affecting land?
a.
Deed
b.
Eviction notice
c.
Six month lease
d.
Bill of sale
3. Notice of ownership given by one’s presence on his land is called
a.
constructive notice.
b.
public notice.
c.
inquiry notice.
d.
attendant notice.
4. Deeds are recorded
a.
to provide constructive notice of their existence.
b.
because the law requires it.
c.
to satisfy a lender.
d.
to give actual notice.
5. The recording of an instrument in the proper county provides the public with
a.
constructive notice.
b.
final notice.
c.
bona fide notice.
d.
after-acquired notice.
6. An acknowledgement can be witnessed by a notary public
a.
in person.
b.
by mail.
c.
by fax.
d.
by proxy.
7. Which of the following is true of an acknowledgement?
a.
It may be witnessed by a notary public.
b.
Many states require that deeds be acknowledged before title passes.
c.
The notary must attest that the deed is valid.
d.
It is required by the Statute of Frauds.
8. A notary public’s commission expires on January 1, 2010. He may take a valid acknowledgement
a.
if he applied for renewal before that date.
b.
within 30 days after that date.
c.
through January 1, 2010.
d.
any time, because notaries are commissioned for life.
9. Documents are recorded by
a.
placing the original document on file in the recorder’s office.
b.
submitting the original document which is photocopied and placed on file.
c.
copying the original document and returning it and the copy to the grantor.
d.
filing the name and address of the property owner.
10. A deed, which is not recorded, is
a.
void.
b.
voidable.
c.
unenforceable.
d.
valid.
11. All of the following real estate documents are usually recorded EXCEPT
a.
a mortgage.
b.
an easement.
c.
a 99-year lease.
d.
a promissory note.
12. Which of the following most correctly describes “chain of title”?
a.
Boundary descriptions of the property
b.
Encumbrances which prevent use of the land
c.
Succession of property owners
d.
Recording laws
13. Albert owns a certain parcel of land. You cold most easily find Albert’s name and this parcel listed in
the
a.
grantee index.
b.
grantor index.
c.
trustor index.
d.
lis pendens index.
14. Information regarding pending law suits would be found in the
a.
lis pendens index.
b.
judgement roles.
c.
mortgagee index.
d.
grantor index.
15. What is an abstract of title?
a.
Title insurance
b.
A history of all recorded activity affecting a parcel of real estate
c.
A judgement on real property
d.
A patent
16. To be certain that the seller is actually the owner of the property, the buyer should order
a.
an estoppel certificate.
b.
a general warranty deed.
c.
a survey.
d.
a title search.
17. A report on the claims to title is prepared. It contains a listing of the full chain of title for 80 years. It
concludes with a statement of an attorney stating the current condition of the title and who presently
has claim to it. In most states this document would be known as a
a.
title report.
b.
certificate of title.
c.
jurat.
d.
abstract of title.
18. A title report usually includes all of the following EXCEPT
a.
the property description.
b.
the conditions of the purchase agreement for this sale.
c.
a list of recorded objections for claims to title.
d.
a statement that there could be unrecorded matters that encumber title.
19. Most title insurance does not insure against
a.
public records.
b.
unrecorded liens.
c.
easements of record.
d.
encumbrances of record.
20. Which statement is true of title insurance?
a.
It is required by law
b.
It insures the owner against defects in title
c.
It reveals all defects in the chain of title
d.
It is only required for commercial property
21. A standard owner’s title insurance policy covers
a.
forgery and impersonation.
b.
matters a prudent buyer could discover on their own.
c.
water rights.
d.
government restrictions.
22. Standard owner’s title insurance coverage insures against all of the following EXCEPT
a.
unrecorded encroachments.
b.
recorded easements.
c.
recorded liens.
d.
forgery of documents.
23. A preliminary title insurance report will show all of the following EXCEPT
a.
unrecorded easements.
b.
mortgages of record.
c.
property taxes and assessments.
d.
judgements against the seller.
24. A lender wanting title insurance coverage on a property it is taking as collateral would ask for
a.
an owner’s title policy.
b.
a mortgagee’s title policy.
c.
a mortgagor’s title policy.
d.
a buyer’s policy.
25. A title insurance policy in favor of the mortgagee will insure the
a.
owner.
b.
buyer.
c.
buyer and seller.
d.
lender.
26. Title insurance premiums are paid
a.
annually.
b.
semi-annually.
c.
upon assumption of the loan.
d.
at the inception of the policy.
27. Title that is free from reasonable doubt as to who is the owner and his ability to convey the property, is
called
a.
marketable title.
b.
cloudy title.
c.
naked title.
d.
colorful title.
28. The Marketable Title Act, as presently used in the United States
a.
cuts off inactive claims to rights or interests.
b.
offers state-sponsored title insurance.
c.
guarantees title insurance.
d.
automatically renews title insurance.
29. A request for a court-appointed hearing to determine the lawful ownership of a parcel of land is called
a
a.
cloudy title suit.
b.
quiet title suit.
c.
partition suit.
d.
eminent domain suit.
30. A Torrens certificate of title does which of the following?
a.
Grants title
b.
Alienates title
c.
Eliminates the need to search back further in time than the most recent quiet title action
d.
Guarantees against encroachments
TRUE/FALSE
1. A formal declaration by a person signing that he or she did, in fact, sign the document is called a jurat.
2. People record deeds to provide constructive notice to the world.
3. Mortgages, judgments and trust deeds are usually recorded however, 6-month leases are not.
4. A man bought a home two years ago and sold it a year later. You would expect to find his name and a
reference to the home in the mortgagee index.
5. When an attorney issues a certificate of title, he has based his opinion on an abstract of title.
6. Any subsequent purchasers of a property must obtain a new policy if they desire title insurance.
7. Owner’s title insurance covers the mortgagee.
8. Standard owner’s title insurance premiums are paid only once, when the policy is issued.
9. Prior to enactment of the Statute of Frauds in 1677 a landowner gave notice to the world of his claim
to ownership by visibly occupying the land.
10. A person interested in a property is held by law to be responsible for making further inquiry of anyone
giving visible or recorded notice. This is called “inquiry notice.”
11. Most states do not require that documents be acknowledged before being eligible for recording.
12. Documents to be recorded are photocopied and then placed in alphabetic order.
13. Almost all states use the tract indexing system.
14. If a chain of title is broken, one must search outside the recorder’s office by searching probate court
records and civil court actions to regain the title sequence.
15. When title is clouded by judgments against recent owners or pending lawsuits that might later affect
title, information may be found in the judgment rolls or the lis pendens index.
16. An abstract of title is a summary of all deeds or other documents dealing with the transfer of
ownership.
17. Title insurance is typically purchased after a property is purchased.
18. The amount of coverage provided by a lender’s title policy stays constant over the life of the policy.
19. When a title defect must be removed, a quiet title suit may be the best solution.
20. Under the Torrens system, once a title is registered , any subsequent liens or encumbrances against it
must be entered on the registrar’s copy in order to give constructive notice.
COMPLETION
1. Notice given by the public records and by visible possession, coupled with the legal presumption that
all persons are thereby notified is called ____________________ notice.
2. ____________________ notice is knowledge that one has actually gained based on what one has seen,
heard, read, or observed.
3. A formal declaration by a person signing a document that he or she, in fact, did sign the document is
called a(n) ____________________.
4. Of the two indexing systems, the ____________________ index is the simplest to use.
5. A(n) ____________________ of ____________________ is the linkage of property ownership that
connects the present owner to the original source of title.
6. A(n) ____________________ of ____________________ is a complete historical summary of all
recorded documents affecting the title of a property.
7. A title defect is also known as a title ____________________.
8. A report made by a title insurance company showing current title condition is called a
_________________________.
9. A lender’s title insurance policy is also known as a ____________________ policy.
10. Title insurance has made titles to land much more ____________________.
MATCHING
Choose the one most appropriate answer for each.
a.
abstract of title
k.
opinion of title
b.
abstracter
l.
owner’s policy
c.
actual notice
m.
quiet title suit
d.
certificates of title
n.
reissue rates
e.
constructive notice
o.
title cloud
f.
inquiry notice
p.
title plant
g.
judgment rolls
q.
title report
h.
lender’s policy
r.
tract index
i.
lis pendens index
s.
vested
j.
notary public
t.
witness
1. where information on judgments against recent owners may be found
2. reduced rates offered by some title companies if previous owner’s policy is available
3. one who signs a document stating that they have witnessed a parties signature
4. a summary of all recorded documents affecting title to a given parcel of land
5. a person authorized to take acknowledgements
6. a report made by a title insurance company showing current title condition
7. expert in the field of title search
8. a system for listing recorded documents affecting a particular tract of land
9. a publicly available index whereby a person can learn of any pending lawsuits that may affect title
10. possessed by; owned by
11. notice given by public records or by visible possession coupled with the legal presumption that all
persons are thereby notified
12. a title defect
13. an opinion by an attorney as to who owns a parcel of land
14. court-ordered hearings held to determine land ownership
15. a duplicate set of public records maintained by a title company
16. knowledge gained from what one has seen, heard, read, or observed
17. insurance to protect a property owner against monetary loss if his title is found to be imperfect
18. claims to property rights the law presumes a reasonably diligent person would find through further
investigation
19. a title policy written to protect a real estate lender
20. a statement as to the ownership of a property that is made by an attorney after reading the abstract