LEGAL ASPECTS OF REAL ESTATE – FINAL EXAM COMBINED SET QUESTIONS AND ANSWERS
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LEGAL ASPECTS OF REAL ESTATE
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LEGAL ASPECTS OF REAL ESTATE
LEGAL ASPECTS OF REAL ESTATE – FINAL EXAM COMBINED SET QUESTIONS AND ANSWERS
mistakes in the instrument - Answer-errors made in the preparation of the instrument to be recorded
assurance of title - Answer-abstract of title; attorney's opinion; title insurance; torrens certificate
abstra...
LEGAL ASPECTS OF REAL ESTATE –
FINAL EXAM COMBINED SET
QUESTIONS AND ANSWERS
mistakes in the instrument - Answer-errors made in the preparation of the instrument to
be recorded
assurance of title - Answer-abstract of title; attorney's opinion; title insurance; torrens
certificate
abstract of title - Answer-summary of all recorded transactions, including deeds,
mortgages, judgments, and the like, that affect the title to a specific parcel of land
attorney's opinion - Answer-attorney renders opinions based upon the abstract
title insurance - Answer-a comprehensive indemnity contract that insures the titleholder
against title defects and encumbrances that may exist at the time the policy is issued
torrens certificate - Answer-a document issued under the Torrens system (EU), a type
of land title registration
deed recording - Answer-the final stage of the real estate purchase transaction (post-
closing)
broker - Answer-has an economic interest in the closing; usually participates in closing
preparation and is present at closing
attorney - Answer-attorney ordinarily explains documents, such as deed, abstract or title
insurance policy, mortgage, mortgage note, and closing statements, in advance
settlement clerk - Answer-designated settlement agent; the person who is designated to
coordinate the execution of documents at the closing; does not work on behalf of any of
the parties
buyer's preparation for closing - Answer-obtaining financing, examining title, securing
hazard insurance, determining amount needed at closing, inspecting premises
sellers action at closing - Answer-tender the deed to the buyer or the settlement clerk
for delivery to the buyer; provide evidence of title in the form of an abstract or attorney's
opinion
, purchaser's actions - Answer-tender the purchase price to the seller usually by some
form of check; most closings involve two distinct but related transactions
Real Estate Settlement Procedures Act (RESPA) - Answer-a federal law that requires
lending institutions to disclose certain information to purchasers of residential real estate
and prohibits those institutions from engaging in specified activities
settlement costs booklet - Answer-every lender is required to provide an applicant for a
mortgage loan with a copy of this booklet within three business days of the application
mortgage - Answer-a written instrument that uses real property to secure payment of a
debt; priority interest in a specific piece of material; a two-party instrument where one of
the parties (mortgagor) creates a security interest in property for the other (mortgagee)
secured debts - Answer-a lender's risk is reduced by requiring security on a loan
note - Answer-a written instrument signed by a borrower containing the provisions of a
loan and a promise to repay according to the terms of the agreement between borrower
and lender
title theory - Answer-legal title transferred to a trustee upon satisfaction of the loan
lien theory - Answer-owner gets title, deed, etc up front and not at the end of payments
deed of trust compared - Answer-a written instrument that transfers title to real property
to a trustee as security for a debt owed by the borrower to the lender, who is a
beneficiary of the trust
rights and obligations of parties - Answer-possession, rents and profits, ...
default - Answer-nonperformance of a duty or obligation accepted by either party as part
of the mortgage transaction
equity of redemption - Answer-the right of the mortgagor or another person with an
interest in the property to reclaim it after default but before foreclosure
statutory right of redemption - Answer-the right of a debtor to redeem the property after
a foreclosure sale
foreclosure of a mortgage - Answer-the legal procedure by which a lender who has
advanced funds with real property as security recovers in the event of a default
credit bid - Answer-first bid in a foreclosure "auction" usually given by the lender
judicial foreclosure - Answer-a legal procedure in which a court orders real estate sold
to enforce the mortgagee's rights under the mortgage
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