Escrow & Title
In Utah, the standard for 'marketable title' means title that is:
AFree from all liens and encumbrances of any kind
BReasonably free from doubt and likely to be accepted by a reasonable buyer without objection✓ Correct
CGuaranteed by the state to be free of all defects
DInsured by a title insurance company
Explanation
Marketable title is title that a reasonably prudent buyer would accept as free from reasonable doubt—title that would not expose the buyer to litigation. Minor technical defects may not render title unmarketable if they are unlikely to result in a claim.
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Key Terms to Know
Title Insurance
Insurance protecting against financial loss from defects in a property's title that existed before closing but were unknown at the time of purchase.
EncumbranceAny claim, lien, charge, or liability attached to real property that affects its value or limits its use.
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.
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