Nebraska Practice TestEscrow & Title

Nebraska Escrow & Title
Practice Questions & Answers (2026)

Escrow, title, and closing questions on the Nebraska exam test how real estate transactions are closed, how title is transferred, and what happens at settlement. Nebraska uses title companies or settlement agents to handle closings, and candidates must understand the closing process, settlement statement, and title insurance requirements under Nebraska law. Title insurance, title searches, and the difference between standard and extended coverage policies are tested, as are the specific closing costs that are customarily paid by buyers vs. sellers under Nebraska practice.

Practice Questions

Nebraska Escrow & Title — Practice Questions & Answers

122 questions on Escrow & Title from the Nebraska real estate question bank. First 10 are free — sign up to unlock all 122.

Q1. A special warranty deed differs from a general warranty deed in that the grantor:

A.Provides no warranties whatsoever
B.Warrants the title only against defects that arose during the grantor's period of ownership
C.Guarantees there are no physical defects in the property
D.Warrants title against all claims from any source

Explanation

A special warranty deed limits the grantor's warranty to defects arising during the grantor's ownership only, unlike a general warranty deed which covers all periods.

Q2. An abstract of title is:

A.A type of title insurance policy
B.A condensed history of all recorded documents affecting a property's title
C.A government-issued certificate confirming clear title
D.A lender's appraisal of the property's value

Explanation

An abstract of title is a compiled summary of all recorded documents (deeds, mortgages, judgments, liens) in the chain of title for a property, used to determine the state of the title.

Q3. A buyer's lender requires title insurance to protect:

A.The buyer against future property damage
B.The lender's financial interest against title defects
C.The seller from future legal claims
D.The escrow company from closing errors

Explanation

A lender's title insurance policy protects the lender's security interest in the property against title defects. A separate owner's policy is needed to protect the buyer's interest.

Q4. The process of transferring title at closing requires delivery and acceptance of:

A.A purchase agreement
B.A deed
C.A promissory note
D.A title insurance policy

Explanation

Title to real property passes when a deed is delivered by the grantor and accepted by the grantee. The deed is the instrument of transfer.

Q5. Recording a deed in the county register of deeds office provides:

A.Actual notice only to the immediate neighbors
B.Constructive notice to the world of the contents of the recorded document
C.Proof of the seller's clean title
D.Guarantee that the title is free of all encumbrances

Explanation

Recording provides constructive notice — the legal assumption that everyone is aware of the contents of properly recorded documents — whether or not they have actually read them.

Q6. A seller's closing costs in Nebraska typically include all of the following EXCEPT:

A.Real estate commission
B.Documentary stamp taxes on the deed
C.Buyer's loan origination fee
D.Pro-rated property taxes

Explanation

The buyer's loan origination fee is the buyer's cost, not the seller's. Seller's costs typically include commission, documentary stamps, pro-rated taxes, and any agreed-upon concessions.

Q7. Proration of property taxes at closing means:

A.The buyer pays all taxes for the year of purchase
B.Taxes are divided between buyer and seller based on the portion of the tax year each party owns the property
C.Taxes are waived for the year the property is sold
D.The lender pays all property taxes through an escrow account

Explanation

Property taxes are prorated so each party pays their fair share: the seller covers taxes for the portion of the year they owned the property, and the buyer covers the remainder.

Q8. A mechanic's lien in Nebraska must be filed within how many days of last providing labor or materials to the project?

A.30 days
B.60 days
C.90 days
D.120 days

Explanation

In Nebraska, a mechanic's lien must generally be filed within 120 days after the claimant last performed labor or furnished materials to the project.

Q9. A RESPA Section 8 violation occurs when a settlement service provider:

A.Provides a good-faith estimate of closing costs
B.Receives or pays a fee, kickback, or thing of value in exchange for the referral of settlement service business
C.Discloses the APR to a borrower
D.Issues a Closing Disclosure 3 days before closing

Explanation

RESPA Section 8 prohibits the giving or receiving of any fee, kickback, or thing of value in exchange for the referral of settlement service business, as such arrangements increase costs for consumers.

Q10. Title insurance premiums in Nebraska are typically paid:

A.Annually for as long as the owner holds the property
B.As a one-time premium at closing that provides coverage for as long as the insured holds an interest in the property
C.Monthly as part of the mortgage payment
D.Only when a claim is filed against the title

Explanation

Unlike other types of insurance, title insurance is paid as a one-time premium at closing. Coverage continues as long as the insured (or their heirs) holds an interest in the property.

Q11. The purpose of an escrow in a real estate transaction is to:

A.Allow the buyer to move in before closing
B.Provide a neutral third party to hold funds and documents until all conditions of the sale are met
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