George Real Estate Group Tips To Help You Achieve Success As A Real Estate Investor
Interest, Encumbrances, and Easements
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Assurance of Title
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Method of Title Assurance
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Recording Acts
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Limitations on Property Rights
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Property Rights and Estates
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De nitions
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OVERVIEW
DEFINITIONS Real Property: Ownership rights associated with real estate, including the rights to possess, use, enjoy, and dispose real estate, as well as the right to exclude others from these rights
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Real estate nance is the study of the institutions, markets, and instruments used to transfer money and credit for the purpose of developing or acquiring real property
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Real Estate: Land and the improvements constructed on it
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PROPERTY RIGHTS
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Without ownership some of the rights can be acquired on real estate – lessee
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A lender who does not possess the rights of real estate, his or her interest is secured by it
Property Rights: the right of a person to the possession, use, enjoyment, and disposal of his or her property
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ESTATES ➤
Estate: All that a person owns
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Real Estate => Real property owned
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Classi cations of Estate ➤
Freehold estate: Inde nite use as wished. Freehold estate may have limits. For example, Life Estate lasts as long as the life of the owner
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Leasehold estate: Expires at a particular date
Estate not in possession – Future rights to estate
Remainder: A remainder is the future estate for the third person
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Reversion: The holder of an estate in land (the grantor) conveys to another person (a grantee) a present estate in the property that has fewer ownership rights than the grantor’s own estate and retains for the grantor or the grantor’s heirs the right to take it back, at some time in the future, the full estate that the grantor enjoyed before the conveyance
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Estates in possession – Immediate rights to estate
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INTEREST, ENCUMBRANCES, AND EASEMENTS
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Encumber / Pledge: An owner can pledge his property as a condition to obtain a loan (mortgage – dead pledge (gage))
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Easement: The right to use land that is owned or leased by someone else for some special purpose
Interest: A right or claim on real property, its revenues, or production
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Abstract of Title: A historical summary of the public recorded documents that a ect a title
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Title exists for freehold estates. Leasehold estate is created by a contractual agreement
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Deed: A document that conveys the title from one person (the grantor) to another (the grantee)
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Title assurance is a way of making sure that 1) the sellers have and can convey the quality of title they claim to posses and 2) receive compensation of the title, after transfer, turns out not to be as represented
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Title: Links an individual or entity who owns property to the property itself
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ASSURANCE OF TITLE
METHOD OF TITLE ASSURANCE ➤
General warranty deed: The grantor warrants that the title is free and clear of any claims other than those listed in the deed
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Special warranty deed: The grantor makes the same warranty except that it is limited to defects and encumbrances that occurred only while grantor held the title to the property
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Quitclaim deed: O ers the least protection. No warranties made
Opinion: Opinion of a lawyer regarding quality of title after a title search is conducted. Lawyer is not responsible for defects in the title not disclosed therein
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Warranty:
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METHOD OF TITLE ASSURANCE ➤
Title Insurance: Provide protection for defects that were not known at the time of title transfer. It costs one time insurance premium payment.
RECORDING ACTS
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They also provide set of rules for resolving disputes
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Mechanics’ lien is not publicly disclosed. These lines are for unpaid contractors, workers, and material suppliers
Provide a publicly accessible system for assessing and establishing claims or interest in real estate as against all other parties
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LIMITATIONS ON PROPERTY RIGHTS Government Restrictions: ➤
Private Deed Restrictions:
Property owners may incorporate certain deed restrictions that limit the use of property by all owners, including future owners
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Land use regulations at the state and local level – zoning ordinance (allowable uses, height restrictions, parking requirements, building permits-codes-inspections)
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