Escrow & TitleIntermediateAlabama Exam

Marketable (merchantable) title means:

ATitle free from all liens and encumbrances of any kind, as is typical in most transactions
BTitle that is reasonably free from serious doubt and that a reasonable buyer would acceptCorrect
CTitle insured by a national title company
DTitle recorded within the past 10 years

Why Title that is reasonably free from serious doubt and that a reasonable buyer would accept Is Correct

Answer B: Title that is reasonably free from serious doubt and that a reasonable buyer would accept

Marketable title is title that is reasonably clear of encumbrances and defects such that a reasonable, prudent buyer would accept it. It does not need to be perfect, but it should be free from significant risk of litigation or challenge.

Exam Tip: Escrow & Title

Escrow questions test the neutral third-party role and the sequence of closing events. Remember that the escrow agent acts as a dual agent for both buyer and seller and cannot advocate for either side.

Key Escrow & Title Terms in This Question

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