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Questions and Answers
What is meant by 'marketable title'?
What is meant by 'marketable title'?
What is the primary goal of the recording system?
What is the primary goal of the recording system?
Who compiles the title abstract?
Who compiles the title abstract?
What is referred to as an 'objection' in real estate?
What is referred to as an 'objection' in real estate?
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What does 'chain of title' refer to?
What does 'chain of title' refer to?
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What is the primary purpose of the Marketable Record Title Act?
What is the primary purpose of the Marketable Record Title Act?
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Which type of endorsement is specifically mentioned for use with mortgagee policies?
Which type of endorsement is specifically mentioned for use with mortgagee policies?
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What fraudulent activity did Michael Bogsted allegedly engage in?
What fraudulent activity did Michael Bogsted allegedly engage in?
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What legal consequence did Javon Rendard Walden face for his fraudulent actions?
What legal consequence did Javon Rendard Walden face for his fraudulent actions?
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What type of alerts are available in Central Florida to combat property fraud?
What type of alerts are available in Central Florida to combat property fraud?
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What essential element must a Contract for Sale and Purchase contain to be enforceable under the Statue of Frauds?
What essential element must a Contract for Sale and Purchase contain to be enforceable under the Statue of Frauds?
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Which of the following is NOT a requirement for a valid contract?
Which of the following is NOT a requirement for a valid contract?
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What happens to a contract for sale and purchase in Florida after it has been signed?
What happens to a contract for sale and purchase in Florida after it has been signed?
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Which principle ensures that parties cannot claim intentions outside of what is written in the contract?
Which principle ensures that parties cannot claim intentions outside of what is written in the contract?
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What must parties do to satisfy the consideration requirement in a contract?
What must parties do to satisfy the consideration requirement in a contract?
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Which situation would render a contract for sale and purchase void?
Which situation would render a contract for sale and purchase void?
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What role does title work play in a contract for sale and purchase?
What role does title work play in a contract for sale and purchase?
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What does 'legal capacity of the parties' refer to in the context of contracts?
What does 'legal capacity of the parties' refer to in the context of contracts?
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What is the primary purpose of the indemnification clause in a contract?
What is the primary purpose of the indemnification clause in a contract?
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In the context of the clauses mentioned, what does the 'Integration' clause indicate?
In the context of the clauses mentioned, what does the 'Integration' clause indicate?
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Which party typically hires the Listing Broker?
Which party typically hires the Listing Broker?
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What is a characteristic of an as-built survey?
What is a characteristic of an as-built survey?
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What can waive a lien for services or material on a property?
What can waive a lien for services or material on a property?
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What is the significance of the 'Captions' clause in a contract?
What is the significance of the 'Captions' clause in a contract?
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What does a mortgagee title insurance policy cover in Schedule A?
What does a mortgagee title insurance policy cover in Schedule A?
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What should a buyer do if wood-destroying organisms are found during the termite inspection?
What should a buyer do if wood-destroying organisms are found during the termite inspection?
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Which type of endorsement provides additional coverage for a mortgage policy?
Which type of endorsement provides additional coverage for a mortgage policy?
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What is the recommended practice regarding who prepares closing documents?
What is the recommended practice regarding who prepares closing documents?
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What does a Planned Unit Development (PUD) Endorsement cover?
What does a Planned Unit Development (PUD) Endorsement cover?
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What is the role of a 'Participating Broker' in the transaction?
What is the role of a 'Participating Broker' in the transaction?
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What is a common exception listed in Schedule B of a mortgagee title insurance policy?
What is a common exception listed in Schedule B of a mortgagee title insurance policy?
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Which document is used to determine if there have been any claims regarding condominium assessments?
Which document is used to determine if there have been any claims regarding condominium assessments?
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What describes encroachments in property context?
What describes encroachments in property context?
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What is the definition of an unmarketable title?
What is the definition of an unmarketable title?
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Which document is generally not considered necessary to record in public records?
Which document is generally not considered necessary to record in public records?
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Which of the following documents can potentially affect the title of a real property?
Which of the following documents can potentially affect the title of a real property?
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What is the role of title abstracting?
What is the role of title abstracting?
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Which document must be notarized and witnessed before recording?
Which document must be notarized and witnessed before recording?
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Which of the following is considered a type of recording that may indicate a claim on a parcel of property?
Which of the following is considered a type of recording that may indicate a claim on a parcel of property?
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What must be ensured when a document is recorded in public records?
What must be ensured when a document is recorded in public records?
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Which type of document is specifically mentioned as requiring recording when involving real property?
Which type of document is specifically mentioned as requiring recording when involving real property?
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Study Notes
Module 8: Contract for Sale and Purchase
- Contract for Sale and Purchase: An agreement between two or more parties to buy and sell real estate, enforceable by law.
- Importance: This document governs the entire real estate transaction from signing to closing.
- Statue of Frauds: A law requiring essential terms of real estate agreements to be in writing for enforcement. All aspects related to real property must be in writing.
Basic Contract Principles (Florida)
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Requirements for a valid contract:
- Legal capacity of the parties (over 18 and mentally competent)
- Mutual agreement (offer and acceptance)
- Consideration (exchange of value, promises are valid)
- Lawful purpose (cannot violate laws or public policy - void if it does)
- In writing (for enforcement)
- Parole Evidence Rule: Courts will not consider evidence beyond the four corners of the written contract.
Need for a Contract for Purchase and Sale
- Parties enter a contract for purchase and sale to be completed at a later date.
Module 8: Process and Terms Common to K for P&S
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Typical process:
- Offer made by buyer
- Acceptance by seller
- Formal contract created
- Exchange of signed copies
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Important Considerations:
- If the seller rejects but later tries to accept, then it is too late.
- If the seller tries to change the terms, it is considered a new offer.
- If the seller stalls, and the buyer withdraws, it is too late.
- Buyer can terminate if the seller continues to stall and buyer also withdraws offer.
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All terms are negotiable: Parties can include any terms they want, except for illegal terms.
Module 8: Legal Consequences of Executing K for P&S
- Florida law: No right to back out once a contract has been signed.
- Passing of risk: Risk of loss (like fire) passes from the seller to the buyer.
- Third party rights: The contract doesn't impact the rights of people not involved (i.e., people with claims like lien holders).
Module 9: Possession
- When possession occurs: Usually occurs at closing.
- Seller stays after closing: The contract may include stipulations on the seller's ability to stay beyond the closing date.
- Purchaser moving in early: In cases of an interim period between closing and moving in, proper lease arrangements need to be made for the period.
Module 9: Purchase Price and Payment Terms
- Fixed price: All amounts to be paid (including deposits) are detailed.
- Method of payment: Use of cash, checks, electronic transfers.
- Earnest money deposit: A deposit required by the buyer but is usually tied to a security and held in escrow by an authorized third party (title, attorney, real estate broker).
Module 9: Quality of Title
- Good and marketable title: The title must be free of liens or encumbrances.
Module 9: Time and Place of Settlement
- Tender: Formal offering required by either party to be ready and willing to fulfill obligations.
- Timely execution: Failure to fulfill obligations within agreed times may result in penalties or damages.
Module 10: Recording and Title Abstracting
- Recording importance: Recording is important when priority problems arise, to resolve who has the first claim to a property.
- Priority problems: Concerns in the event of multiple interested parties, like those who claim first lien on the property (mortgages, etc.)
- Successive transfers of partial & total interest: Determining the priority of interest holders who have had subsequent dealings with the property.
- Abstract (aka Title Report): Complete summary of all documents related; shows a property's history.
- Abstractor (aka Title Examiner): Compiles a property's history from public records.
Module 11: Title Insurance
- Title insurance: Covers risks associated with defects in a property's title, including those that already existed. Covers risks that could have arisen in the past.
- Excluded areas of coverage: things like known risks from inspections or problems found in the current survey.
- Who writes the policies: The company that issues is called an "Underwriter", the ones who sell policies to the public are called "Agents".
- Different types of policies: policies for those who hold a mortgage (lender) and those who hold the property (owner) that cover possible risks.
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Description
This quiz covers the essentials of contracts for sale and purchase in real estate according to Florida law. It emphasizes the importance of a valid contract, the requirements for enforceability, and the implications of the Statue of Frauds. Test your understanding of these key concepts and principles critical for real estate transactions.
