Property Ownership
A Florida title is said to be 'merchantable' (marketable). This means the title is:
AInsured by a title company
BReasonably free from doubt and significant encumbrances that a reasonable buyer would accept✓ Correct
CGuaranteed to be defect-free
DListed on a government registry
Explanation
Marketable (merchantable) title is title that a reasonable, well-informed buyer in the marketplace would accept, free from reasonable doubt about its validity. It does not require perfection — minor technical defects that pose no real practical risk are acceptable.
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Key Terms to Know
Encumbrance
Any claim, lien, charge, or liability attached to real property that affects its value or limits its use.
Title InsuranceInsurance protecting against financial loss from defects in a property's title that existed before closing but were unknown at the time of purchase.
Abstract of TitleA condensed history of a property's title, summarizing all recorded documents and encumbrances affecting it from the earliest record to the present.
DeedA written legal instrument used to transfer ownership of real property from one party (grantor) to another (grantee).
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