Principles of Real Estate Exam 3 FINC 3250 Chris Tomlinson

Principles of Real Estate Exam 3 FINC 3250 Chris Tomlinson

1. Other ways of transferring title a. Death will (testate) or without will (intestate) → i. Dying testate: if one dies with a will, the property is passed according to the will ii. Dying intestate: if one dies without a will, the property passes according to that state’s intestate succession law 1. Intestacy statutes: every state will determine who will get your property based on your family tree at the time you pass away 2. In Alabama, if the decedent is survived by a spouse, intestate succession is: a. If the decedent didn’t leave parents or children, the spouse gets everything b. If the decedent was survived by parents but not by children, the spouse gets $100,000 and half of the balance of the decedent’s estate i. The decedent’s parents get the remaining half c. If the decedent had children who are also children of the surviving spouse, the surviving spouse gets $50,000 and one half of the balance of the decedent’s estate i. The surviving children share the other half of the balance d. If the decedent had living children that are not the children of the surviving spouse, the surviving spouse gets one half of the estate and the decedent’s children get the remaining half 3. In Alabama, if the decedent is not survived by a spouse, intestate succession is: a. Children and their descendents b. Parents c. Brothers and sisters, or if all are decreased, nieces and nephews d. Grandparents, aunts, and uncles, or if all deceased, to their descendants e. The state of Alabama iii. Holographic will: a handwritten will 1. A few states still allow these iv. Oral will: the way these once worked is that whoever heard the oral will had to write down what they heard as soon as they could and have any witnesses sign the document 1. Not allowed in “normal” circumstances anymore lOMoARcPSD|14985576 2. You can see why they are no longer allowed 3. About the only time they come up anymore are with soldiers, sailors, airmen, and Marines killed in combat combat zones 4. Officers can still hear oral wills and have them enforced v. Codicil: an amendment to a will 1. Before delete keys and electronic documents, changing a will would require retyping the whole thing 2. To avoid that, states allowed a codicil to be filed that only changed part of a will 3. Changing a will is not nearly as big a deal these days, so the codicil has all but disappeared b. Adverse possession: defined in chapter 3 c. Accession: this is a change in the property owned by addition or subtraction of other property i. This obvious example is man-made: I build a home on a vacant lot and the home becomes part of the real property by annexation, which is a type of accession 1. Annexation: a man-made addition to the property ii. Accretion: the gradual addition of new real property by action of water 1. It happens in one of two ways a. Alluvian: sediment slowly being deposited over time to form new, dry ground b. Reliction: new, dry ground that is gained by a body of water permanently receding iii. Avulsion: the rapid loss of real property, usually by the action of water 1. E.g. a flood causes a river to change course, so the land under the new part of the river is lost 2. Could also be caused by the action of wind d. Public grant: title may change due to the government granting land they own to an individual via a public grant i. Title is usually transferred via a land patent in this case e. Dedication: title may change due to an individual granting land they own to the government i. Think of the mandatory dedications discussed in chapter 3 ii. This can happen in one of three ways 1. Statutory dedication 2. Dedication by deed 3. Common law dedication iii. When title is transferred via deed in these circumstances, the deed form used is usually a cession deed f. Forfeiture: a change in ownership due to one party’s failure to uphold a Downloaded by Clare Kemmy (clarekemmy@gmail.com) lOMoARcPSD|14985576 qualified fee or the expiration of a qualified fee g. Alienation: this is a catch-all term that simply refers to any transfer of title i. The old owner is said to have alienated their ownership 1. I don’t have anywhere else to put this one, so it goes here 2. Need for public records a. Public records: a set of documents in every county which contain any document that affects the ownership of real estate within that county i. No document is affect in regards to the ownership of real estate unless it is recorded or filed for record 1. If a document is not recorded, it is ineffective for anything in regards to ownership of real estate b. When ownership was conveyed by the clump of dirt method, and possession was the main indicator of ownership, there was no need for recordation i. As people became more mobile, and deeds replaced clumps of dirt, finding the person with the most recent deed became important ii. Solution a government-sponsored system of recording documents → affecting title to real estate c. Constructive notice: recording documents in the public records is one way to provide this to the world of your ownership interest in a piece of property i. Possessing the property is the other ii. Any person is considered to have knowledge of every document recorded in the public record whether they have seen the records or not d. Inquiry notice: further investigating anyone making a claim of ownership in a property one is interested in buying i. You could learn of the ownership claim by perusing the public record or by visiting the property e. Actual notice: knowledge about a property that one gains from stuff one actually sees i. Documents, the property, etc. f. Recording acts: every state has laws on the books requiring every document affecting title to real estate to be recorded in the courthouse at the county seat i. The way the law is typically enforced is that documents are not considered effective as far as subsequent buyers go until they are recorded ii. They stamp it iii. First in time = first in title 1. A document recorded earlier will always take precedent of a document recorded later 2. A race to the courthouse