Real Estate Law & Transactions Flashcards

Which of the following liens typically has the HIGHEST priority in a foreclosure regardless of when it was recorded?

Answer: Real property tax lien

Real property tax liens are generally given super-priority by statute and take precedence over all other liens, including a first mortgage, regardless of recording date.

What is the legal significance of recording a deed in the public records?

Answer: It provides constructive notice of the conveyance to subsequent purchasers and creditors

Recording a deed provides constructive notice to the world, protecting the grantee against subsequent claims by parties who might later acquire an interest from the same grantor.

A commercial lease clause stating the tenant pays base rent plus a proportionate share of the building's operating expenses, taxes, and insurance is called a:

Answer: Net lease

A net lease (commonly a triple net or NNN lease) requires the tenant to pay base rent plus some or all operating expenses, taxes, and insurance in addition to rent.

Under the Fair Housing Act, which of the following is NOT a protected class?

Answer: Sexual orientation (under federal law as of 1968)

The original federal Fair Housing Act of 1968 protects race, color, religion, national origin, sex, familial status, and disability; sexual orientation is not a separately enumerated federal FHA class, though some states add it.

What is a 'lis pendens' and what effect does it have on a real estate transaction?

Answer: A recorded notice that a pending lawsuit affects the title to a specific property, warning prospective purchasers

A lis pendens ('suit pending') is a recorded notice that litigation involving the property is underway, putting prospective buyers on constructive notice and making it very difficult to sell or mortgage the property during the suit.

In which situation would a legal assistant MOST likely prepare a 'release of mortgage' or 'satisfaction of mortgage'?

Answer: When the borrower has paid the mortgage loan in full

A release or satisfaction of mortgage is recorded when the borrower has fully repaid the loan, discharging the lien from the public record.

An easement appurtenant differs from an easement in gross in that:

Answer: An easement appurtenant runs with the dominant tenement and transfers automatically with the land

An easement appurtenant benefits a dominant parcel and automatically passes with ownership of that parcel; an easement in gross benefits a person or entity rather than adjacent land and generally does not run with the land.