A county government acquires a parcel through tax foreclosure and later sells it at a public auction. The county's deed represents that it holds title and possession through the foreclosure process, but it expressly declines to make broad covenants about the title's history before the foreclosure. It will not warrant against unknown defects predating its ownership. The buyer at auction therefore purchases title insurance to fill the gap. The deed is stronger than a quitclaim (since it implies ownership) but weaker than the broadest warranty deed (since it omits sweeping pre-ownership covenants). Which type of deed did the county use?
Correct Answer
C) Bargain-and-sale deed
The deed implies the county holds title and possession (more than a quitclaim) but expressly excludes broad pre-ownership warranties (less than a general warranty deed). That middle-ground instrument is the bargain-and-sale deed.
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Related Topics & Key Terms
Key Terms:
Related Concepts
A quitclaim deed transfers whatever interest the grantor may have in a property without making any warranties or guarantees about the quality of title. It offers the least protection to the grantee.
Recording is the act of placing a document in the public records at the county recorder's office to give constructive notice to the world of an interest in real property. Recording protects the holder's interest against subsequent claims.
A special warranty deed guarantees that the grantor has not caused any title defects during their period of ownership, but does not warrant against defects that existed before the grantor acquired the property.
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- → A buyer records a deed at the county recorder's office. What is the primary purpose of recording?
- → A buyer drives past the property and sees someone other than the seller living there and maintaining the yard. This observation should put the buyer on what type of notice?
- → In a covered purchase transaction, the borrower receives a final form showing the loan terms, cash to close, and settlement charges shortly before consummation. What form is this?
- → Along with the signed offer, Quinn Brooks delivers a check to demonstrate serious intent to complete the transaction if the offer is accepted. What is this deposit called?
- → On a settlement statement, the buyer's earnest money reduces the remaining cash needed to close. How is that item characterized?
- → On a settlement statement, an item increases the buyer's amount due at closing. How is that item characterized?
- → On the seller's settlement statement, the purchase price of $400,000 appears as what?
- → At closing, the purchase price of $350,000 appears on the buyer's side of the settlement statement. Is this amount a debit or a credit to the buyer?
- → Under TRID rules, the lender must deliver the Closing Disclosure to the borrower at least how many business days before loan consummation?
- → In an escrow closing, the escrow agent discovers that the seller has not yet provided the signed deed. What should the escrow agent do?
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