Property OwnershipIntermediateAlabama Exam

Which of the following correctly describes a 'remainder' interest in real property?

AThe portion of a lot left over after a subdivision
BThe future interest of a third party who will receive the property after a life estate endsCorrect
CThe seller's remaining equity after paying off the mortgage
DThe broker's remaining commission after splitting with the co-broker, under standard practice

Why The future interest of a third party who will receive the property after a life estate ends Is Correct

Answer B: The future interest of a third party who will receive the property after a life estate ends

A remainder is a future interest in real property held by a third party (the remainderman), who will receive the property after the current possessory interest (such as a life estate) ends.

Exam Tip: Property Ownership

Property ownership questions test the bundle of rights and different forms of ownership. Know the differences between joint tenancy, tenancy in common, and community property, including the right of survivorship.

Key Property Ownership Terms in This Question

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