© 2009 by south-western, cengage learning samirlander chapter 9

© 2009 by South-Western, Cengage Learning

SAMSAMIRLANDERIRLANDER

Chapter 9Chapter 9

Florida Real Estate:Florida Real Estate: Principles, Practices and Principles, Practices and

License LawLicense Law

Chapter 9Chapter 9

Title Deeds and Ownership Title Deeds and Ownership RestrictionsRestrictions



Key TermsKey Terms

Abstract of title

Acceptance

Acknowledgment

Actual notice

Adverse possession

Assignment

Chain of title

Condemnation

Constructive notice

Covenant of further assistance

Covenant of seisin

Covenant of warranty of title

Deed

Deed restrictions

Delivery

Doctrine of laches


Key TermsKey Terms

Easement

Eminent domain

Encroachment

Escheat

Fee

General lien

General warranty deed

Graduated lease

Grant

Grantee

Granting clause

Grantor

Gross lease

Ground lease

Habendum clause

Index lease

Leasehold


Key TermsKey Terms

Lien

Lis pendens

Marketable title

Net lease

Percentage leases

Quiet enjoyment

Quitclaim deed

Recourse loans

Sandwich lease

Special warranty deed

Specific lien

Sublease

Title

Title opinions

Torrens system


Methods of TransferMethods of Transfer



Against the wishes and control of the owner

During life:Court judgment

Foreclosure action

Bankruptcy



At death:

EscheatEscheatNo will or heirs

Property goes to the state

Eminent domainEminent domainPublic taking of private property

CondemnationCondemnation

Process



Adverse possession: Adverse possession: lawful taking of another's property

Open and notorious occupation

Color of title

Continuous – 7 years

Paid property taxes



Deed

Inheritance

Adverse possession

Acts of nature



Liens

Easements

Leases


DeedsDeeds

Deed: Deed: conveys ownership interest in real property

Statue of Frauds:

In writing

Signed by grantor

Acknowledgement: Grantor Acknowledgement: Grantor

(seller) acknowledges his signature

to the granteegrantee (buyer)


DeedsDeeds

Examples of deed restrictions:Minimum set back requirements

Minimum square footage

Grant: Grant: act of conveying real property

Grantor: transfers title

Grantee: receives title


DeedsDeeds

Must be in writing and include:

1. 1. Competent grantor: legally competentLegal age

Sound mind

In some states the grantee Sound mind

Not required in Florida

Can be a minor


DeedsDeeds


2. 2. ConsiderationValuable consideration: money or it’s equivalent

Good consideration: love and affection

3. 3. Words of conveyance

Granting clauseGranting clause

Indicate intent to transfer title


DeedsDeeds


4. 4. Property descriptionLegal identification of property

Street address is not acceptable

5. 5. Name of grantor and grantee

Chain of title: Chain of title: links current owner

to previous owner

Fictions name may be used


DeedsDeeds


6. 6. Grantors signatureFlorida requires 2 witnesses

Grantee signature not required

7. 7. Delivery and acceptance

DeliveryDelivery

Deed in possession of grantee

Deed is recorded


DeedsDeeds


Acceptance: Acceptance: Grantee…Retains the deed

Records the deed

Encumbers title

Performs any act of ownership


DeedsDeeds

Seven Essential Elements

1. Competent grantor

2. Consideration

3. Words of conveyance

4. Property description

5. Name of grantor and grantee

6. Grantor’s signature

7. Delivery and acceptance


DeedsDeeds

Non essential elements

Habendum clause: Habendum clause: type and extent of interest being transferred


Types of DeedsTypes of Deeds

General warranty deedGeneral warranty deed

Special warranty deedSpecial warranty deed

BarBargain and sale deedgain and sale deed

Quitclaim deedQuitclaim deed

Grantor grantees titleCovenants (promises)



General Warranty DeedGeneral Warranty DeedMost common

Greatest guarantee of title

General warranty deed covenantsCovenant of seisinCovenant of seisin

Covent against encumbrancesCovent against encumbrances

Covenant of quiet enjoymentCovenant of quiet enjoyment

Covenant of further assistanceCovenant of further assistance

Covenant of warranty of titleCovenant of warranty of title



Covenant of SeisinCovenant of SeisinGrantor owns property

Has the right to convey

Covent Against EncumbrancesCovent Against EncumbrancesNo hidden encumbrances

Covenant of Quiet EnjoymentCovenant of Quiet EnjoymentFree from claims by anyone else



Covenant of Further AssistanceCovenant of Further AssistanceAKA: Covenant of further assurance

Grantor will act to protect title being conveyed

Covent of Warranty of TitleCovent of Warranty of TitleAKA: Covenant of warranty

forever

Grantor will bear expense of

defending claims

No time limit



Special Warranty DeedSpecial Warranty DeedGrantor has not encumbered the property

Bargain and Sale DeedBargain and Sale DeedConveys interest with no warranties

Implies grantor has a claim

Quitclaim DeedQuitclaim DeedContains no warranties expressed

or implied


TitlesTitles

Abstract of titleAbstract of titleFull summary of all instruments affecting title

Statement of liens and encumbrances

Marketable title: Marketable title: free of reasonable doubt as to ownership


TitlesTitles

Title opinions: Title opinions: indicates encumbrances, liens, or easements affecting the property

Instituted to record deeds

Provides a means of search and research


TitlesTitles

Two ways to give noticeRecording documents

Occupying property

To determine ownershipExamine public record

Look at property


TitlesTitles

Give notice by public recording and occupancy

Must inspect both records and property

Actually seen, heard, read, or observed


TitlesTitles

In county or city where property is located

Not required


TitlesTitles

Registered land titles

Verify ownership using single document

Establish status of title


TitlesTitles

Steps:Quiet title action

Court determines condition of title

Torrens title certificateExact boundaries

Title holder

Encumbrances


Titles Titles

Protects against:Forged documents

Undisclosed heirs

Incorrectly filed documents

Mistaken heirs in wills

Gaps in chain of title


Titles Titles

Acquisition cost

Protects for as long as owner or heirs retain an interest


Titles Titles

Amount equal to original loan

Decreases as loan is paid


TitlesTitles


EasementsEasements

Easement:Easement: limited right to use or occupy the property of another

3 typesEasement appurtenant

Easement in gross

Party wall easement


EasementsEasements

Easement becomes part of the dominant estate

Easement remains if owner of:

Dominant estate dies or sell

Servient estate dies or sells Figure 9.4Figure 9.4


EasementsEasements

Only one property

Right to use servant estate for a specific purpose

Commercial easement in gross

Future owners are bound by the easement

Assignable


EasementsEasements

Personal easement in gross

Holder is a person

Terminates upon death

Not transferable


EasementsEasements

One wall forms part of two buildings

Each owns half on their property

Easement on the half of adjacent property


EasementsEasements

Personal privilege to use the land of another

Terminated at will

Cannot be assigned


EasementsEasements


EncroachmentsEncroachments

Unauthorized intrusion onto the land of another

Encroaches on land

Violates airspace

Discovered bySurvey

Observation


LeasesLeases

Estate for yearsEstate for yearsFixed term

At expiration: terminates or extends with a new agreement

Does not terminate upon sale or death


LeasesLeases

Estate at willEstate at willNo definite term

Rent may increase or decrease

Terms may change

Terminated by notification

Florida proper notice


LeasesLeases

Estate at sufferanceEstate at sufferanceTenant remains beyond lease period without permission

Holdover tenant


LeasesLeases

Written or oral

Payment of rent

Definite or indefinite period

Statue of FraudsMore than 1 year in writting

to be enforceable


LeasesLeases

Landlord is the lessorUsually the owner

Tenant is the lessee

2 components of real property FeeFee is the land

Improvements are the

leaseholdleasehold


LeasesLeases

Gross LeaseGross LeaseTenant pays only fixed monthly rent

Landlord pays expensesResidential

CommercialLease rider clause

FloridaTenant may pay utilities


LeasesLeases

Net LeaseNet LeaseTenant pays only fixed monthly rent plus some or all expenses

Landlord pays expenses

not paid by tenant


LeasesLeases

Percentage LeasePercentage LeaseBase rent plus percentage of gross sales

Percent may be from:First $ representing sales

In excess of agreed upon

gross sales amount


LeasesLeases

Ground LeaseGround LeaseLong term lease on land

Lessee improves the land

Pays property tax, insurance

and expenses


LeasesLeases

Graduated LeaseGraduated Lease

Fixed rent for initial period with rent increasesLong term leases

Increased cost of living

Market conditions resulting

in higher rents

Shopping center without

established clientele


LeasesLeases

Graduated LeaseGraduated Lease

Slow market conditionsLower rent to begin

Incremental increases

Renewal at higher rents


LeasesLeases

Sandwich Lease / SubleaseSandwich Lease / Sublease

Leased property is subleasedOriginal tenant is lessor

New tenant is lessee

Other termsOverlandlord

Overtenant

Undertenant


LeasesLeases

Index Lease / Modified Gross LeaseIndex Lease / Modified Gross Lease

Provision for future rent based on increasing operating costs

Escalator clauseEconomic index


LeasesLeases


LeasesLeases

Protects owner against tenant-related losses

Nonpayment

Damage


LeasesLeases

Competent parties

Legal description

Agreement

Signatures

Provision for rent

Term


LeasesLeases

Expiration

Mutual Agreement

Destruction or condemnation of property

Breach of contract


LeasesLeases

Two types of evictionActual eviction

Constructive eviction

Lease is not terminated byDeath of either party

Sale of property


LeasesLeases

Assignment: transfer of all rights and interests held by tenant

Assignee is primarily liable

Assignor secondarily liableNovation


LeasesLeases

Sublet transfers some but not all rights and interest

Sublessor retains reversionary rights

Sublessor is solely liable

Subleasee is liable to the original tenant


LiensLiens

Lien: Lien: a legal claim for repayment of debtLienor: has the right of lien on the property of another

Lienee: person whose property is subject to the lien

Property pledged as security

for repayment of the loan


LiensLiens

5 types

Property tax accessed according to value

Collection proceduresMunicipality

Individual who purchased liens


LiensLiens

Improvements for those properties affected

Failure to pay income tax

Taxes levied upon death


LiensLiens

Tax paid on corporate profits

Labor or materials used in construction or improvement

Filed within 90 days

Lawsuit within 1 year

Lis pendens: Lis pendens: lawsuit pending


LiensLiens

Monetary award resulting from a lawsuitAll real and personal property of defendant

Writ of execution

Proceeds from foreclosure sale

are insufficient to cover debtLiens all assets

Recourse loans: Recourse loans: Personal

guarantee of payment


LiensLiens

Deficiency judgment liensVoluntary vs. involuntary

General vs. specific

Voluntary liens: created by agreementMortgage lien

Involuntary liens: created by lawTax liens

Mechanic’s lien

Judgment liens


Categories of LiensCategories of Liens


LiensLiens

General lien: General lien: attaches to all property Federal income tax lien

Judgment lien

Deficiency judgment lien

Specific lien: Specific lien: attached to

specific propertyProperty tax lien

Mortgage lien

Mechanic’s lien


LiensLiens

Race statues: priority based on date of recordation

Exceptions:Real property tax liens

1st priority

Mechanics liensWork began

Material delivered


LiensLiens

Lien must be satisfied

Lien is assumed

© 2009 by south-western, cengage learning samirlander chapter 9

Documents

cengage learning deedsdeed

title deeds

granteechain of title

ownership restrictions

real propertygrantor

grantor seller

competent grantor

florida real estate