Property OwnershipIntermediateCalifornia Exam

What is the purpose of a title search?

ATo determine the physical boundaries of the property, consistent with common law property ownership principles

BTo examine public records and establish the chain of title to identify defects or encumbrancesCorrect

CTo appraise the market value of the property, per standard California real property conventions

DTo ensure the seller has paid all property taxes, under standard California property ownership law

Why To examine public records and establish the chain of title to identify defects or encumbrances Is Correct

Answer B: To examine public records and establish the chain of title to identify defects or encumbrances

A title search examines public records (deeds, liens, court judgments, encumbrances) to establish the chain of title and identify any defects, liens, or other issues that could affect ownership rights.

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

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.

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.

People Also Study

Key Terms to Know