Title Search & Real Estate Closings Flashcards
7 cards from real ACP practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 7 Title Search & Real Estate Closings flashcards as text
What is a 'quiet title action'?
Answer: A court proceeding to establish or confirm a party's ownership rights against all adverse claimants
A quiet title action is a lawsuit asking a court to declare who holds valid title and to extinguish competing claims, clearing the cloud on title.
Which type of title insurance policy protects the lender's interest in the mortgaged property?
Answer: Loan (mortgagee) policy
A loan policy (also called a mortgagee policy) insures the lender's security interest up to the outstanding loan balance and is required by most lenders.
In real estate closings, 'escrow' refers to:
Answer: A neutral third party holding funds and documents until all closing conditions are satisfied
Escrow is the process by which a disinterested third party holds money, deeds, and other instruments until all conditions of the transaction are met.
A covenant running with the land differs from a personal covenant in that it:
Answer: Binds and benefits successors to the original parties' properties, not just the original parties themselves
A covenant running with the land is binding on and enforceable by future owners because it is tied to the land itself rather than the personal agreement of original parties.
When a title search reveals an 'unreleased mortgage' from a prior owner, the paralegal should:
Answer: Flag it as a title defect and seek a payoff letter or recorded release from the prior lender
An unreleased prior mortgage is a lien on the property; it must be paid off and a recorded release obtained to clear title before or at closing.
Which of the following BEST describes a title plant used by title companies?
Answer: A privately maintained index of recorded documents organized for efficient title searching
A title plant is a private duplicate record system maintained by title companies that mirrors public records, allowing faster and more efficient title searches.
At closing, the disbursement of loan proceeds and purchase funds is coordinated by the closing agent. What is the closing agent's primary duty at this stage?
Answer: To ensure all conditions in the escrow instructions are met before releasing funds and recording documents
The closing agent acts as a neutral escrow holder and disburses funds and authorizes recording only after confirming all contractual and lender conditions have been satisfied.