Types of deeds and how title passes

Six months after purchasing a property, a buyer discovers a mechanic's lien filed for a kitchen remodel the buyer ordered after closing. The buyer files a claim with their owner's title insurance policy. How will the title company likely respond?

1. The claim will be denied because mechanic's liens are excluded from public record searches
2. The claim will be approved since standard policies cover all subsequent liens
3. The claim will be denied because the lien arose after the policy date
4. The claim will be prorated by the date of the work
5. The claim will be approved if the buyer purchased an extended coverage endorsement

A property buyer receives a title insurance policy. The title company negligently fails to discover a properly recorded utility easement. After closing, the utility company claims easement rights. Does the buyer have notice of this easement?

1. Yes, via constructive notice
2. Yes, through direct actual notice
3. No, lacking actual notice
4. No, title insurance prevents notice
5. No, due to the search error

A property owner completely executes and notarizes a deed conveying a farm to their nephew but leaves the document in a locked desk drawer. The nephew finds the key, takes the deed without permission, and records it. Who holds legal title to the farm?

1. The original owner, because voluntary delivery and acceptance did not occur.
2. The nephew, because the deed was properly executed, notarized, and formally recorded.
3. The nephew, because physical possession of a notarized deed creates an irreversible transfer.
4. The state, because the taking voids the estate.
5. The original owner, but only if they file a quiet title lawsuit within thirty days.

Seller acquired title through a forged deed in the prior chain of title, unknown to Seller. Seller conveys the property to Buyer using a special warranty deed. Later, the true owner challenges title. Buyer sues Seller. Will Buyer recover?

1. No, because the defect predates Seller's ownership
2. Yes, because a special warranty deed covers unknown defects
3. No, because a special warranty deed carries no covenants at all
4. Yes, because Seller had a duty to inspect the prior chain
5. Yes, because Seller impliedly warranted title against all defects

Buyer inspects a property and sees a tenant occupying it. Buyer does not ask about any lease. After closing, Buyer discovers an unrecorded 10-year lease. Does Buyer take title subject to the lease?

1. Yes, because all unrecorded leases run with the land
2. No, Buyer had no actual knowledge
3. No, because Buyer was a bona fide purchaser for value
4. Yes, because possession provided inquiry notice
5. No, because the lease was unrecorded

Buyer obtains an owner's title insurance policy without a survey. After closing, a neighbor's fence is discovered to encroach 2 feet onto the property. Buyer files a claim. Is the encroachment covered?

1. Yes, because the policy insures against all title defects
2. No, because standard policies exclude survey matters
3. Yes, boundary disputes are covered
4. No, because encroachments are covered only if recorded
5. Yes, because the fence existed before closing

A homebuyer is purchasing a standard owner's title insurance policy. During the review, the buyer asks what risks are universally covered. Which of the following issues is typically excluded from coverage under a standard owner's title insurance policy?

1. Incompetent grantors in the chain of title
2. Forged prior deeds
3. Changes in local zoning ordinances
4. Undisclosed spousal interests from past sales
5. Errors or omissions in the public records

A title search reveals that a seller's ex-spouse never signed a deed releasing their interest in the property after a finalized divorce. Which of the following is the most efficient method to clear this specific title defect?

1. Executing a completely new general warranty deed from the seller
2. Obtaining and recording a quitclaim deed from the ex-spouse
3. Recording an affidavit of adverse possession against the ex-spouse
4. Filing a formal quiet title action in the local county court
5. Requesting a specialized endorsement from the title insurance company

On Monday, an owner conveys title to Buyer A, who fails to record. On Wednesday, the owner conveys the same property to Buyer B. Buyer B pays value, lacks notice of A, and records immediately. In a race-notice state, who holds superior title?

1. Buyer B, because a second conveyance always voids the first.
2. Buyer B, by purchasing without notice and recording first.
3. Buyer A, because they were the first to receive the deed.
4. Seller, because conveying twice invalidates both transactions.
5. Buyer A, if A proves the earlier sale.

A criminal forges a homeowner's signature on a deed and sells the property to an unsuspecting buyer. The buyer pays market value, receives the deed, and promptly records it. What is the legal status of the buyer's ownership?

1. The buyer holds valid title because they were a bona fide purchaser who paid fair market value.
2. The buyer holds no legal title because a forged deed is entirely void.
3. The buyer holds a voidable title that becomes fully valid if the original owner fails to object.
4. The buyer holds valid title because the recorded deed provides constructive notice to the public.
5. The buyer holds equitable title until the original homeowner successfully files a quiet title action.

A buyer reviews preliminary documents and sees a reference to a prior unrecorded mortgage on the property. The public records show no such mortgage. The buyer proceeds with the purchase. Does the buyer take title subject to this unrecorded mortgage?

1. No, unrecorded encumbrances are void
2. Yes, via actual notice
3. No, missing constructive notice
4. No, records govern
5. Yes, from constructive notice

Buyer Green records a deed in a pure race jurisdiction on Monday. On Tuesday, Buyer Green learns that Seller previously conveyed the same parcel to Buyer Blue, whose deed remains unrecorded. Under a race statute, which party has priority to the property?

1. Buyer Green, because Green recorded first regardless of subsequent knowledge
2. Buyer Blue, because Blue's deed was executed earlier in time
3. Neither party, because Green's knowledge triggers a duty to investigate and clouds Green's title
4. Buyer Blue, because Green had actual knowledge of Blue's interest before closing
5. The court will impose a constructive trust in favor of Blue based on equitable principles

Grantor conveys Blackacre to Grantee by warranty deed at a time when Grantor does not own Blackacre. Two years later, Grantor acquires title to Blackacre by inheritance. Grantor then refuses to convey to Grantee, claiming Grantee never received valid title. Under the doctrine of estoppel by deed, what is the likely result?

1. Grantor retains title and may refuse to convey because the original deed was void ab initio when Grantor lacked ownership
2. Grantee must pay additional consideration to Grantor to validate the original conveyance now that Grantor has acquired lawful title
3. Grantee has a claim for breach of warranty of title but does not automatically acquire Blackacre; Grantee must sue for damages
4. Grantee must obtain a new deed from Grantor after the inheritance, as the original deed conveyed nothing and remains a nullity
5. Grantee automatically acquires title when Grantor inherits Blackacre, and Grantor is estopped from denying the earlier conveyance

After contract signing, a creditor records a $12,000 judgment lien against the seller. The seller has no cash to pay it, but the sale proceeds will be far larger than the lien. To close and convey marketable title, which method is most appropriate?

1. Close on time and let the creditor collect from the buyer later.
2. Record a release of the lien without payment.
3. Close because title insurance covers it.
4. Pay off the lien from the sale proceeds at closing.
5. Obtain a subordination agreement from the judgment creditor.

Grantor executes and delivers a deed conveying Blackacre to Grantee, who places the deed in a safe without recording it. Six months later, Grantee informs Grantor that Grantee no longer wishes to own Blackacre and refuses to accept the property. Grantor wants to reclaim title. What is the legal effect of Grantee's refusal?

1. Acceptance is presumed for beneficial conveyances; Grantee's later refusal is ineffective
2. Grantee can unilaterally refuse acceptance, and title automatically reverts to Grantor
3. Because Grantee never affirmatively accepted in writing, no title passed and Grantor retains ownership
4. Grantee's refusal constitutes abandonment, extinguishing Grantee's interest and vesting title in Grantor
5. Acceptance is revocable within one year, so Grantee's refusal is valid and title returns to Grantor