,SOLUTION MANUAL FOR ma ma
Real Estate Finance And Investments 17th International Edition Jeffrey Fisher Wil
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liam B. Brueggeman
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Chapter 1-23 ma
Solutions to Questions—Chapter 1 ma ma ma
An Introduction to Real estate Investment: Legal Concepts
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Question 1-1 ma
What is the difference between real property and personal property?
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Real property refers to the ownership rights associated with realty. Realty refers to land and all
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things permanently attached. Personal property refers to ownership rights associated with pers
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onalty. Personalty are all things, tangible, intangible that are movable. This includes all things
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that are not realty. ma ma ma
Question 1-2 ma
What is meant by an estate? ma ma ma ma ma
Estate is used to denote a possessory or potentially possessory interest in real estate. However,
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not all interests in real property are estates. Ownership can be quite different from possession an
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d a variety of legal factors affect the ownership rights associated with real estate. The economi
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c benefits expected by lenders, investors, and other parties in a real estate transaction are affect
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ed by these legal factors.
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Question 1-3 ma
How can a leased fee estate have a value that could be transferred to another party?
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The original fee owner can give up some property rights to a lessee. The value of the leased fe
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e estate will depend on the amount of lease payments expected during the term of the lease pl
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us the value of the property when the lease terminates, and the original owner receives the rev
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ersionary interest. ma
Question 1-4 ma
What are title records? What is an abstract of title?
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Title records (sometimes referred to as deeds and conveyances records and/or real property rec
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ords) are created and maintained usually at the county level. These records identify all propert
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ies in a county, including location, present ownership and any liens or encumbrances affecting
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each property. These records are critical to investors who want to identify the owner of specifi
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c tracts or land, existing buildings, etc. These records are also important because they contain
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evidence of encumbrances such as mortgage liens, tax liens (to be covered in later chapters), e
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tc. Example: a prospective investor sees a vacant tract of land that he is interested in purchasi
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ng. Because there is no signage or any improvements on the land, how can the land owner be
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identified and contacted? By going to the county records office (deeds and conveyancers depa
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rtment) the investor can use the address to locate a property (usually in plat books), then the c
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urrent owner. These records are used to link a precise property to its owner. At some point, if t
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his investor continues to be interested in purchasing the land, he will likely retain an attorney
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or abstractor to do a title search and abstract of title. The latter is done to not only
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, identify the current owner but to trace all previous owners with commentary on the likelihood
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of other parties who may ownership rights and /or interests in the tract of land.
ma ma ma ma ma ma ma ma ma ma ma ma ma ma
Question 1-5 ma
What is a deed? How is it different from the title?
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The deed is a document usually created by the owner of a property containing the property legal
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I.D. and location in addition to any improvements that exist on the property. It also describes t
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he extent to which the seller warrants that he is the owner of the property and has the right to
ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma
convey ownership. A deed is used to convey the title from one person (the grantor) to another
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(the regrantee) by means of a written instrument. The term ―title‖ is an abstract term frequent
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ly used to link an individual or entity who owns property to the property itself. When a person
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has
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―title,‖ he is said to have all the elements, including the documents, records, and acts, that prove
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ownership. Title establishes the quantity of rights in real estate being conveyed from seller to
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It differs from title because title provides evidence of ownership based on the collective recor
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ds that exist pertaining to a property.
ma ma ma ma ma ma
Question 1-6 ma
What is meant by a title record? Why are these records so important?
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The title record refers to records on file, usually at the county level, that help to specify tracts
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of real estate and determine if a seller has the right to convey ownership of such real property.
ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma
These records are the most important sources of events affecting real estate ownership over tim
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e and are usually reviewed when trying to identify the ―quality‖ of title that investors will rece
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ive if they purchase. After a review of these records (usually by an attorney), if in his opinion,
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they are complete, he will indicate that the seller has ownership and title to the property. Mos
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t of the instruments that affect title to real estate are recorded, in accordance with the recordin
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g acts of the various states, at what is typically called the county recorder’s office.
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Question 1-7 ma
What is a future estate? Give an example?
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We think of most real estate transactions as acquiring ownership at the present time. However,
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ownership can also occur at a later time, say after the current owner dies. The person who be
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comes the owner at that time is said to be a ―remainder‖ estate. Future estates include a rever
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sion and remainder. A reversion results in the state reverting back to the original possessor whe
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reas the remainder results in a third-party obtaining possession at some point in the future.
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Question 1-8 ma
Name the three general methods of title assurance and briefly describe each. Which would you
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recommend to a friend purchasing real estate? Why?
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General Warranty Deed - ma ma ma
the grantor warrants that the title he/she conveys to the property is free and clear of all encum
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brances, other than those that are specifically listed in the deed.
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Special Warranty Deed - ma ma ma
makes the same warranties as a general warranty deed except that it limits their application to
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defects and encumbrances which occurred only while the grantor held title to the property.
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Quitclaim Deed - ma ma
offers the grantee the least protection in that it imply conveys to the grantee whatever rights,,
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, interests,, and title that the grantor may have in the property. No warranties are made about the
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nature of these rights and interests or of the quality of the grantor’s title to the property.
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Real Estate Finance And Investments 17th International Edition Jeffrey Fisher Wil
ma ma ma ma ma ma ma ma ma ma
liam B. Brueggeman
ma ma
Chapter 1-23 ma
Solutions to Questions—Chapter 1 ma ma ma
An Introduction to Real estate Investment: Legal Concepts
ma ma ma ma ma ma ma
Question 1-1 ma
What is the difference between real property and personal property?
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Real property refers to the ownership rights associated with realty. Realty refers to land and all
ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma m
things permanently attached. Personal property refers to ownership rights associated with pers
a ma ma ma ma ma ma ma ma ma ma ma
onalty. Personalty are all things, tangible, intangible that are movable. This includes all things
ma ma ma ma ma ma ma ma ma ma ma ma ma ma
that are not realty. ma ma ma
Question 1-2 ma
What is meant by an estate? ma ma ma ma ma
Estate is used to denote a possessory or potentially possessory interest in real estate. However,
ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma
not all interests in real property are estates. Ownership can be quite different from possession an
ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma
d a variety of legal factors affect the ownership rights associated with real estate. The economi
ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma
c benefits expected by lenders, investors, and other parties in a real estate transaction are affect
ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma
ed by these legal factors.
ma ma ma ma
Question 1-3 ma
How can a leased fee estate have a value that could be transferred to another party?
ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma
The original fee owner can give up some property rights to a lessee. The value of the leased fe
ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma
e estate will depend on the amount of lease payments expected during the term of the lease pl
ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma
us the value of the property when the lease terminates, and the original owner receives the rev
ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma
ersionary interest. ma
Question 1-4 ma
What are title records? What is an abstract of title?
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Title records (sometimes referred to as deeds and conveyances records and/or real property rec
ma ma ma ma ma ma ma ma ma ma ma ma ma
ords) are created and maintained usually at the county level. These records identify all propert
ma ma ma ma ma ma ma ma ma ma ma ma ma ma
ies in a county, including location, present ownership and any liens or encumbrances affecting
ma ma ma ma ma ma ma ma ma ma ma ma ma
each property. These records are critical to investors who want to identify the owner of specifi
ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma
c tracts or land, existing buildings, etc. These records are also important because they contain
ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma
evidence of encumbrances such as mortgage liens, tax liens (to be covered in later chapters), e
ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma
tc. Example: a prospective investor sees a vacant tract of land that he is interested in purchasi
ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma
ng. Because there is no signage or any improvements on the land, how can the land owner be
ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma
identified and contacted? By going to the county records office (deeds and conveyancers depa
ma ma ma ma ma ma ma ma ma ma ma ma ma
rtment) the investor can use the address to locate a property (usually in plat books), then the c
ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma
urrent owner. These records are used to link a precise property to its owner. At some point, if t
ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma
his investor continues to be interested in purchasing the land, he will likely retain an attorney
ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma
or abstractor to do a title search and abstract of title. The latter is done to not only
ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma
, identify the current owner but to trace all previous owners with commentary on the likelihood
ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma
of other parties who may ownership rights and /or interests in the tract of land.
ma ma ma ma ma ma ma ma ma ma ma ma ma ma
Question 1-5 ma
What is a deed? How is it different from the title?
ma ma ma ma ma ma ma ma ma ma
The deed is a document usually created by the owner of a property containing the property legal
ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma
I.D. and location in addition to any improvements that exist on the property. It also describes t
ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma
he extent to which the seller warrants that he is the owner of the property and has the right to
ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma
convey ownership. A deed is used to convey the title from one person (the grantor) to another
ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma m
(the regrantee) by means of a written instrument. The term ―title‖ is an abstract term frequent
a ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma
ly used to link an individual or entity who owns property to the property itself. When a person
ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma
has
ma
―title,‖ he is said to have all the elements, including the documents, records, and acts, that prove
ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma
ownership. Title establishes the quantity of rights in real estate being conveyed from seller to
ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma
It differs from title because title provides evidence of ownership based on the collective recor
ma ma ma ma ma ma ma ma ma ma ma ma ma ma
ds that exist pertaining to a property.
ma ma ma ma ma ma
Question 1-6 ma
What is meant by a title record? Why are these records so important?
ma ma ma ma ma ma ma ma ma ma ma ma
The title record refers to records on file, usually at the county level, that help to specify tracts
ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma
of real estate and determine if a seller has the right to convey ownership of such real property.
ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma
These records are the most important sources of events affecting real estate ownership over tim
ma ma ma ma ma ma ma ma ma ma ma ma ma ma
e and are usually reviewed when trying to identify the ―quality‖ of title that investors will rece
ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma
ive if they purchase. After a review of these records (usually by an attorney), if in his opinion,
ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma
they are complete, he will indicate that the seller has ownership and title to the property. Mos
ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma
t of the instruments that affect title to real estate are recorded, in accordance with the recordin
ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma
g acts of the various states, at what is typically called the county recorder’s office.
ma ma ma ma ma ma ma ma ma ma ma ma ma ma
Question 1-7 ma
What is a future estate? Give an example?
ma ma ma ma ma ma ma
We think of most real estate transactions as acquiring ownership at the present time. However,
ma ma ma ma ma ma ma ma ma ma ma ma ma ma
ownership can also occur at a later time, say after the current owner dies. The person who be
ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma
comes the owner at that time is said to be a ―remainder‖ estate. Future estates include a rever
ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma
sion and remainder. A reversion results in the state reverting back to the original possessor whe
ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma
reas the remainder results in a third-party obtaining possession at some point in the future.
ma ma ma ma ma ma ma ma ma ma ma ma ma ma
Question 1-8 ma
Name the three general methods of title assurance and briefly describe each. Which would you
ma ma ma ma ma ma ma ma ma ma ma ma ma ma m
recommend to a friend purchasing real estate? Why?
a ma ma ma ma ma ma ma
General Warranty Deed - ma ma ma
the grantor warrants that the title he/she conveys to the property is free and clear of all encum
ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma
brances, other than those that are specifically listed in the deed.
ma ma ma ma ma ma ma ma ma ma
Special Warranty Deed - ma ma ma
makes the same warranties as a general warranty deed except that it limits their application to
ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma m
defects and encumbrances which occurred only while the grantor held title to the property.
a ma ma ma ma ma ma ma ma ma ma ma ma ma
Quitclaim Deed - ma ma
offers the grantee the least protection in that it imply conveys to the grantee whatever rights,,
ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma
, interests,, and title that the grantor may have in the property. No warranties are made about the
ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma m
nature of these rights and interests or of the quality of the grantor’s title to the property.
a ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma ma
