Escrow & Title
A 'marketable title' in Maine real estate means:
AA title free from reasonable doubt as to its validity and free from undisclosed encumbrances that would affect a reasonable buyer✓ Correct
BA title that guarantees the property will appreciate in value
CA title that has been insured by a title company
DA title that has been in one family for 100 years
Explanation
Marketable title is title that is free from reasonable doubt, litigation risk, and undisclosed encumbrances, such that a reasonably prudent buyer would accept it without requiring a price reduction or other concession.
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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.
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.
Loan-to-Value Ratio (LTV)The ratio of a mortgage loan amount to the appraised value or purchase price of a property, expressed as a percentage.
DepreciationA reduction in the value of an improvement (building) over time due to physical deterioration, functional obsolescence, or external factors.
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