Escrow & TitleIntermediateArizona Exam

An abstract of title in Arizona is:

AA title insurance policy that summarizes the covered risks and exceptions applicable to the insured property, prepared by the title company as part of the closing package

BA condensed history of all recorded documents affecting title to a propertyCorrect

CA legal description of the property prepared by a licensed Arizona surveyor that identifies the parcel's boundaries using metes and bounds or lot and block references

DA licensed surveyor's physical survey of the property's boundaries, improvements, and encroachments, prepared for the buyer to verify the accuracy of the legal description

Why A condensed history of all recorded documents affecting title to a property Is Correct

Answer B: A condensed history of all recorded documents affecting title to a property

An abstract of title is a summary of all recorded documents in the chain of title for a property, including deeds, mortgages, liens, and other encumbrances. An attorney then issues a title opinion based on the abstract.

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

Deed

A written legal instrument used to transfer ownership of real property from one party (grantor) to another (grantee).

Encumbrance

Any claim, lien, charge, or liability attached to real property that affects its value or limits its use.

Lien

A financial claim against a property that serves as security for a debt or obligation, giving the creditor the right to foreclose if unpaid.

Title Insurance

Insurance protecting against financial loss from defects in a property's title that existed before closing but were unknown at the time of purchase.

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Key Terms to Know

Abstract of Title

A condensed history of a property's title, summarizing all recorded documents and encumbrances affecting it from the earliest record to the present.

Title Insurance

Insurance protecting against financial loss from defects in a property's title that existed before closing but were unknown at the time of purchase.

Chain of Title

The sequential record of all transfers of ownership for a piece of property from the original patent holder to the present owner.

Deed

A written legal instrument used to transfer ownership of real property from one party (grantor) to another (grantee).

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