Escrow & Title
In Montana, which of the following would NOT constitute a cloud on title requiring resolution before closing?
AA paid-off mortgage for which a reconveyance was never recorded
BAn expired listing agreement with a prior broker✓ Correct
CAn unresolved mechanic's lien from a contractor
DAn undischarged bankruptcy from the seller's history affecting the property
Explanation
An expired listing agreement creates no lien or encumbrance on the property—it does not cloud title. An unrecorded reconveyance, unresolved mechanic's lien, and undischarged bankruptcy affecting the property are all title clouds requiring resolution.
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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.
Listing AgreementA contract between a property owner and a real estate broker that authorizes the broker to market and sell the property.
LienA financial claim against a property that serves as security for a debt or obligation, giving the creditor the right to foreclose if unpaid.
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.
State-Specific Concepts
Mechanic's Lien
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