Property Ownership
Indiana's doctrine of equitable conversion holds that, once a purchase contract is signed, the buyer acquires:
ALegal title immediately
BEquitable title and bears the risk of loss if the property is damaged before closing✓ Correct
CNo interest until the deed is recorded
DA leasehold interest until closing
Explanation
Under equitable conversion, once a binding purchase contract is executed, the buyer holds equitable title and generally bears the risk of loss. Modern purchase agreements typically address risk of loss explicitly.
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Key Terms to Know
Deed
A written legal instrument used to transfer ownership of real property from one party (grantor) to another (grantee).
Purchase AgreementA legally binding contract between a buyer and seller that outlines the terms and conditions of a real estate sale.
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.
Math Concepts
State-Specific Concepts
DRE Regulation
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