CALIFORNIA REAL ESTATE – Chapter 10 (Transfer of Title) – Questions

#1. Which deed is most commonly used in California residential real estate transactions?

Quitclaim deed

Grant deed

Warranty deed

Trust deed

#2. A quitclaim deed differs from a grant deed in that a quitclaim deed:

Provides implied warranties that the property has not been previously sold

Guarantees the title is completely free from defects

Transfers only whatever interest the grantor currently holds without any warranties

Secures a loan as collateral

#3. Under California Civil Code §1092, a grant deed contains which of the following implied warranties?

The property is guaranteed to appreciate in value

The property has not been previously conveyed and is free from encumbrances created by the grantor except those disclosed

The grantor will defend the title against all future claims

The property complies with all current building codes

#4. For a deed to be valid in California, which of the following is required?

The deed must be notarized and recorded

The deed must be signed by both the grantor and grantee

The deed must be approved by the DRE

The deed must be in writing, signed by the grantor, and describe the property using a legal description

#5. Recording a deed with the county recorder’s office establishes:

Actual notice to all parties in the transaction

A guarantee that the title is clear

Constructive notice of the transfer, which protects the buyer against subsequent claims

The exact market value of the property

#6. John purchases a property and receives a grant deed but delays recording for 2 weeks. During that time, the seller fraudulently conveys the same property to Mary, who records immediately. Under California recording law:

John has priority because he purchased first

Mary has priority rights because she recorded first, establishing constructive notice

Both buyers share equal rights to the property

The deed is void because of the fraud

#7. A warranty deed provides which level of protection to the grantee?

Limited protection covering only defects created by the grantor

No protection or warranties of any kind

Protection only against liens created in the last 5 years

The highest level, guaranteeing the title is completely free from defects throughout the entire property history

#8. A trust deed in California involves three parties. They are:

Buyer, seller, and agent

Grantor, grantee, and notary

Principal, agent, and subagent

Trustor (borrower), beneficiary (lender), and trustee (neutral third party)

#9. Which of the following is TRUE about title insurance in California?

Title insurance protects against losses from undiscovered historical defects existing before the policy date

Title insurance covers future events such as fire or natural disasters

Title insurance is required by state law for all transactions

Title insurance replaces the need for a title search

#10. The difference between a marketable title and an insurable title is:

They are the same thing

A marketable title requires insurance; an insurable title does not

A marketable title is free from significant defects; an insurable title has known defects that title insurance will cover

An insurable title is always superior to a marketable title

#11. Under California law, which of the following transfer methods occurs WITHOUT the owner’s consent?

A sale between a willing buyer and seller

Foreclosure due to mortgage default

A gift from parent to child

An exchange of properties between two owners

#12. Adverse possession in California requires all of the following EXCEPT:

Open and notorious occupation

Continuous possession for 5 years

Written permission from the property owner

Payment of property taxes during the period of possession

#13. Under the California Probate Code, if a person dies without a valid will:

Property is distributed according to California’s intestate succession laws, with the surviving spouse receiving the largest share

The state automatically takes ownership of all property

All property goes to the oldest child

The property is distributed equally among all living relatives

#14. Non-judicial foreclosure in California is typically completed within:

12-18 months

30 days

24 months

3-4 months

#15. The probate process in California serves to:

Transfer property without court involvement

Validate the will, settle debts, and distribute the deceased’s assets under court supervision

Eliminate property taxes for inherited property

Automatically transfer title to the surviving spouse

#16. Eminent domain requires the government to provide:

Free replacement property

Tax credits for 10 years

Just compensation to the property owner based on fair market value

Approval from the property owner

#17. An escrow agent in California acts as:

A neutral fiduciary holding funds and documents until all transaction conditions are satisfied

An advocate for the buyer only

A representative of the lender

An appraiser of the property

#18. Under California Financial Code §17000, escrow holders are required to:

Invest client funds for maximum return

Represent the buyer’s interests exclusively

Determine the property’s market value

Maintain segregated trust accounts, provide detailed accounting, and carry errors and omissions insurance

#19. A proration of property taxes ensures that:

The buyer pays all property taxes for the entire year

The seller pays all property taxes for the entire year

Each party pays their proportionate share of taxes based on the number of days they own the property

Property taxes are waived during the year of sale

#20. If annual property taxes are $3,650 and closing is July 1, with the seller owning from January 1 to June 30 (181 days), the seller’s share of property tax is approximately:

$1,825

$3,650

$1,810

$1,000

#21. California transfer taxes are imposed on the conveyance of property at rates typically ranging from:

A flat fee of $100 per transaction

0.5% to 1.1% of the sale price, varying by county

5% of the sale price

10% of the assessed value

#22. Which of the following correctly describes the chain of title?

The physical chain used to survey property boundaries

A legal document filed with the DRE

A chronological record of all transfers of ownership for a property

The sequence of mortgage payments made by the owner

#23. Under California law, a buyer who receives a grant deed is protected against:

All title defects regardless of when they occurred

Future zoning changes

Property value declines

Encumbrances created by the grantor that were not disclosed

#24. A seller offers a quitclaim deed in a standard residential sale. A buyer’s agent should advise the buyer to:

Accept the quitclaim deed because it is standard in California

Insist on a grant deed and obtain title insurance because a quitclaim deed provides no warranties

Only accept if the property is under $100,000

Request a warranty deed instead of a grant deed

#25. The recording process in California is governed by:

California Code of Civil Procedure §690 et seq.

California Civil Code §1092

California Revenue and Taxation Code §11900

California Financial Code §17000

#26. Under California law, which of the following statements about constructive notice is TRUE?

Constructive notice requires personal delivery of the document to all interested parties

Constructive notice is only created by newspaper publication

Unrecorded documents create constructive notice

Recording a document with the county recorder creates constructive notice, meaning the public is deemed to know about it even if they haven’t personally seen it

#27. A quiet title action is used to:

Reduce property taxes

Eliminate mortgage obligations

Transfer property without a deed

Resolve disputes about property ownership and establish clear title through a court proceeding

#28. Under California probate law, a simplified probate procedure is available for estates valued at less than:

$184,500 (as adjusted periodically)

$500,000

$1,000,000

$50,000

#29. Which of the following is TRUE about an owner’s title insurance policy?

It protects the lender against borrower default

It guarantees the property will appreciate in value

It covers losses from future events

It protects the buyer against losses from defects in the title that existed before the policy date

#30. A lender’s title insurance policy:

Protects the buyer from title defects

Protects the lender against title defects that could affect the lender’s security interest in the property

Covers the buyer and lender equally

Is the same as the owner’s policy

#31. Under California law, which of the following is NOT a method of voluntary property transfer?

Adverse possession

Sale of property

Gift of property

Transfer through a will

#32. A title search reveals a gap in the chain of title. This indicates:

The property has been properly maintained

No issues exist with the title

A potential problem that may require legal action to resolve before the property can be conveyed with clear title

The property taxes have been paid

#33. Under California Revenue and Taxation Code §11900, transfer taxes are typically paid by:

Always the buyer

The seller, though parties can negotiate in the contract

The county recorder

The title company

#34. A property is being sold and the seller has not yet paid the annual property taxes of $4,380. Closing is August 15. Using 365 days, the seller’s share (Jan 1-Aug 14, 226 days) is approximately:

$2,712

$2,190

$4,380

$1,668

#35. Under California law, notarization of a deed is:

Not legally required for validity but is standard practice and facilitates recording

Required by law for all deeds

Only required for quitclaim deeds

Only required for properties over $500,000

#36. Which of the following is TRUE about the relationship between title insurance and warranty deeds in California?

Warranty deeds are preferred over title insurance

Title insurance has largely replaced warranty deeds because it provides broader protection without making the seller personally liable

Title insurance and warranty deeds serve the same function

Warranty deeds are required when title insurance is not available

#37. Under California law, the executor of a will is responsible for:

Purchasing new property for the heirs

Conducting a title search on all properties

Appraising all real property in the estate

Inventorying assets, settling debts, paying estate taxes, and distributing property per the will’s instructions

#38. A cloud on title can be caused by all of the following EXCEPT:

An outstanding mechanic’s lien

A properly recorded and satisfied mortgage

A disputed boundary line

A pending lawsuit against the property owner

#39. Under California law, which of the following is TRUE about the probate sale of real property?

Probate sales are faster than standard sales

Probate sales do not require title insurance

Probate sales are exempt from disclosure requirements

Probate sales require court approval and specific procedures, including potential overbidding in court

#40. Constructive notice differs from actual notice in that:

Constructive notice requires personal delivery

Actual notice is always established by recording

There is no legal distinction between the two

Constructive notice is established by recording and is presumed regardless of personal knowledge, while actual notice is direct knowledge of a fact

#41. A deed in lieu of foreclosure occurs when:

The lender forecloses through the court system

The borrower sells the property at auction

The trustee conducts a non-judicial foreclosure

The borrower voluntarily transfers the property to the lender to avoid the foreclosure process

#42. Under California law, which of the following is required for a valid will?

The will must be notarized

The will must be in writing, signed by the testator, and witnessed by at least two disinterested parties

The will must be filed with the DRE

The will must be approved by the probate court before the testator’s death

#43. A property owner dies with a valid will leaving the home to a specific beneficiary. The transfer occurs through:

Testate succession under probate court supervision

Intestate succession

Adverse possession

Eminent domain

#44. Under California law, a trust deed allows for which type of foreclosure?

Non-judicial foreclosure conducted by the trustee, which is faster and less costly than judicial foreclosure

Only judicial foreclosure through the court system

Administrative foreclosure by the DRE

Voluntary foreclosure by the borrower

#45. The settlement statement (closing statement) in a real estate transaction:

Details all financial aspects including purchase price, closing costs, prorations, and adjustments for both buyer and seller

Only shows the purchase price

Is prepared by the buyer’s agent

Is not required in California transactions

#46. Under California law, the buyer’s share of prorated property taxes at closing:

Covers the entire tax year

Covers the period from the closing date through the end of the tax period

Is always zero because the seller pays all taxes

Is determined by the buyer’s lender

#47. A title company discovers that a previous deed in the chain of title was signed by a minor. This is:

Not a concern because all deeds are valid regardless of the signer’s age

Only a problem if the minor is now an adult

A defect that cannot be cured

A potential title defect because contracts signed by minors may be voidable

#48. Under California law, an abstract of title:

Is the same as a title insurance policy

Guarantees the title is clear

Is a summary of all recorded documents affecting the property’s title, including deeds, liens, and encumbrances

Is prepared by the escrow company

#49. Which of the following statements about recording priority is CORRECT?

Generally, the first document recorded has priority over subsequently recorded documents (first in time, first in right)

The last document recorded has priority

Priority is determined by the document’s date of execution, not recording

Recording priority is determined by the DRE

#50. Under California law, a property transferred through a gift requires:

Only a verbal declaration of intent

A court order approving the transfer

A deed (grant or gift deed) that meets all statutory requirements for a valid conveyance

Payment of the full market value in consideration

#51. A homestead declaration in California:

Eliminates all property taxes

Prevents the government from exercising eminent domain

Automatically transfers the property to the homeowner’s heirs

Provides limited protection against forced sale of the property to satisfy certain debts

#52. Under California law, which of the following is TRUE about the transfer tax exemption?

Certain transfers such as gifts, interspousal transfers, and transfers to trusts may be exempt from documentary transfer taxes

No transfers are exempt from transfer taxes

Only government transfers are exempt

Transfers under $100,000 are automatically exempt

#53. A title search reveals an unrecorded easement that allows a utility company to access the property. Under California law:

Unrecorded easements are never valid

The easement may still be valid and enforceable even though it is not recorded, especially if it was created by necessity or prescription

The easement is only valid if the buyer agrees to it

Unrecorded easements automatically terminate after 5 years

#54. Under California law, rent proration at closing ensures that:

The buyer pays all rent for the month of closing

Rent is not prorated in California transactions

If the property is a rental, the seller credits the buyer for any rent collected for the period after the closing date

The seller keeps all rent collected regardless of the closing date

#55. A trust used to hold real property in California:

Avoids probate and allows for private transfer of property according to the trust terms

Requires probate court approval for all transfers

Eliminates property taxes on the transferred property

Must be filed with the DRE

#56. Under California law, the Closing Disclosure (required by TRID for mortgaged properties) must be provided to the buyer:

At the time of closing

Within 30 days after closing

At least 3 business days before the consummation of the loan

Only if the buyer requests it

#57. A property owner executes a grant deed but never delivers it to the grantee. Under California law:

The deed is not effective because delivery and acceptance are required to transfer title

The deed is effective as soon as it is signed

Recording is the only requirement for the deed to be effective

The deed is effective if the grantor intended to transfer the property

#58. Under California law, which of the following correctly describes the doctrine of constructive notice?

Constructive notice requires the document to be published in a newspaper

Constructive notice only applies to deeds, not liens

Constructive notice is created by verbal announcements at a public meeting

Once a document is properly recorded, all persons are deemed to have notice of its contents regardless of actual knowledge

#59. A buyer at closing discovers that the seller’s grant deed contains an error in the legal description. The buyer should:

Accept the deed with the error because it can be corrected later

File a lawsuit against the title company

Record the deed with the error and hope no one notices

Request a correction deed (corrective deed) from the seller to fix the error before recording

#60. Under California law, a lis pendens is:

A type of deed

A recorded notice that a lawsuit has been filed involving the property, warning potential buyers of the pending litigation

A notice of property tax delinquency

A building permit application

#61. Which of the following statements about title insurance coverage is CORRECT?

Standard and extended coverage provide the same protection

Extended coverage only adds flood insurance

Standard coverage includes surveying errors

A standard coverage policy covers risks found in public records; an extended coverage policy adds protection for risks such as encroachments and unrecorded liens

#62. Under California law, a deed executed by a person under duress is:

Void from the beginning

Voidable at the option of the person who was under duress

Valid because all signed deeds are enforceable

Only voidable with DRE approval

#63. A property in California is sold at a tax sale because the owner failed to pay property taxes. The new buyer at the tax sale receives:

A warranty deed with full guarantees

A grant deed with all standard warranties

Automatic clear title with no encumbrances

A tax deed that may be subject to the former owner’s right of redemption for a specified period

#64. Under California law, the buyer and seller each receive a copy of the settlement statement:

Only after the transaction is recorded

Only if they request it

Within 30 days after closing

Before closing for review, allowing them to verify all charges and credits before funds are disbursed

#65. A property owner places property in a living trust. Under California law:

The transfer triggers reassessment of property taxes

The transfer to the trust avoids probate and is generally exempt from documentary transfer taxes and reassessment under Proposition 13

The transfer requires probate court approval

The property cannot be sold while in the trust

#66. Under California law, the documentary transfer tax is calculated based on:

Only the down payment amount

The assessed value of the property

The difference between the sale price and the original purchase price

The total value of the consideration (purchase price) or the fair market value of the property

#67. A buyer purchases a property at a judicial foreclosure sale. Under California law:

The former owner may have a right of redemption, allowing them to reclaim the property by paying the full sale price plus costs within a specified period

The former owner has no rights after the judicial sale

Judicial foreclosure sales provide no redemption rights

The buyer receives a quitclaim deed

#68. Under California law, which of the following is TRUE about joint tenancy and the right of survivorship?

When one joint tenant dies, their interest automatically passes to the surviving joint tenant(s) without probate

Joint tenancy interests pass through probate

Joint tenancy requires a will to specify distribution

Joint tenancy interest passes to the deceased’s children

#69. A grantor signs a deed and places it in a safe deposit box with instructions to deliver it to the grantee after the grantor’s death. Under California law:

The deed is valid because the grantor intended to transfer ownership

The deed is effective upon the grantor’s death

The deed is generally NOT valid because proper delivery requires the grantor to relinquish control during their lifetime

The bank can deliver the deed as instructed

#70. Under California law, homestead protection amounts vary based on:

The homeowner’s circumstances, including age, disability status, and household composition, with the minimum amount set at $300,000

The property’s assessed value only

The number of rooms in the home

The homeowner’s income level

#71. A mechanic’s lien in California:

Requires court approval before being filed

Is only valid for government projects

Expires after 30 days regardless of payment

Gives a contractor or laborer a security interest in the property for unpaid work or materials

#72. Under California law, a property is transferred through intestate succession when:

The property owner dies without a valid will, and the property passes to heirs according to state law

The property owner creates a trust

The property is sold at auction

The property is gifted to a charity

#73. A title insurance policy’s coverage amount typically:

Increases annually with inflation

Decreases as the mortgage is paid down

Equals the purchase price at the time of purchase and does not increase unless the policy is updated or reissued

Covers unlimited amounts regardless of purchase price

#74. Under California law, an escrow agent may NOT:

Release funds without satisfying all conditions of the escrow instructions from both parties

Hold funds in a neutral account

Provide copies of documents to both parties

Coordinate with the title company

#75. Which of the following statements about deed delivery in California is CORRECT?

A deed is effective as soon as it is signed

Delivery is not required if the deed is notarized

A deed must be delivered by the grantor and accepted by the grantee with the intent to transfer ownership for the transfer to be complete

The county recorder delivers all deeds

#76. Under California law, a property sold through eminent domain must be appraised:

At the original purchase price

At the assessed value for tax purposes

At fair market value to determine just compensation for the property owner

By the government agency acquiring the property

#77. A buyer purchases property and discovers after closing that an undisclosed easement exists. The buyer’s recourse depends on:

The type of deed received and whether the buyer has title insurance covering the undisclosed easement

The property’s assessed value

The seller’s current income

Whether the buyer conducted a home inspection

#78. Under California law, the statutory period for adverse possession is:

10 years

3 years

20 years

5 years of continuous, open, notorious, hostile, and exclusive possession with payment of taxes

#79. A title company issues a preliminary title report that shows a judgment lien against the seller. Before closing:

The lien must be satisfied or addressed to deliver clear title as required by the purchase agreement

The buyer must accept the property with the lien

The lien automatically expires after 30 days

The title company must pay off the lien

#80. Under California law, what happens to a joint tenancy when one joint tenant sells their interest to a third party?

The joint tenancy continues with the new owner

The entire property must be sold

The joint tenancy is severed as to the selling tenant’s share, creating a tenancy in common between the new owner and the remaining joint tenant(s)

The remaining joint tenants must approve the sale

#81. A property is transferred by a court order as part of a divorce settlement. This type of transfer:

Requires a warranty deed

Is typically done using a quitclaim deed or interspousal transfer deed and is generally exempt from documentary transfer taxes

Must go through probate

Is subject to the same transfer taxes as a regular sale

#82. Under California law, which of the following is TRUE about documentary transfer tax rates?

The rate is uniform throughout California at exactly 1%

The standard county rate is $1.10 per $1,000 of value (or consideration), with some cities imposing additional transfer taxes

Transfer tax rates are set by the federal government

Only properties over $1 million are subject to transfer taxes

#83. A deed that omits the grantee’s name is:

Valid as long as the grantor’s name is included

Valid if the property is properly described

Generally invalid because a grantee must be identified or identifiable for the deed to effectively transfer title

Valid because the county recorder will add the name

#84. Under California law, which of the following events triggers a reassessment of property value for tax purposes under Proposition 13?

An annual inflation adjustment above 2%

A request by the property owner

A change in the county assessor

A change in ownership or new construction

#85. A buyer at a non-judicial foreclosure sale in California:

Receives a warranty deed with full protections

Receives a trustee’s deed upon sale and the former owner generally has no right of redemption

Has a mandatory 1-year waiting period before taking possession

Must obtain the former owner’s consent before moving in

#86. Under California law, the escrow process typically concludes when:

All conditions of the escrow instructions are satisfied, funds are disbursed, and the deed is recorded with the county recorder

The buyer signs the purchase agreement

The seller accepts the buyer’s offer

The home inspection is completed

#87. A property’s title is found to have an unrecorded mechanics lien. Under California law:

Unrecorded mechanics liens are never enforceable

The lien is only valid for 30 days

The mechanics lien may still be enforceable against the property even though it was not recorded, depending on when the work was performed

Only recorded liens affect title

#88. Under California law, escheat occurs when:

A property owner dies without a will and without any identifiable heirs, and the property passes to the state

The government exercises eminent domain

A property is abandoned by the owner

The property taxes are not paid for 5 years

#89. A settlement statement shows a credit to the buyer for property taxes. This credit means:

The seller owes money for property taxes covering the seller’s period of ownership, which is credited to the buyer at closing

The buyer is receiving a discount on the purchase price

The government is subsidizing the buyer’s taxes

The escrow company is paying the buyer’s taxes

#90. Under California law, a grant deed must contain which of the following to be valid?

The grantee’s signature

The purchase price

A granting clause, property description, and the grantor’s signature

The date of the original construction

#91. Which of the following is TRUE about California’s Proposition 19 regarding property tax transfers?

It eliminates property taxes for all seniors

It freezes property taxes at 1978 levels for all homeowners

It only applies to commercial property transfers

It allows eligible homeowners (over 55, disabled, or disaster victims) to transfer their tax base to a replacement property anywhere in California up to three times

#92. Under California law, a deed recorded out of sequence (e.g., a later transfer recorded before an earlier one) affects:

Nothing, because execution date always determines priority

Only the title insurance coverage

Recording priority, as the first recorded document generally has priority regardless of the order of execution

Only commercial property transfers

#93. A buyer discovers that the property has an encroachment (the neighbor’s fence extends 2 feet onto the property). Under California law:

Encroachments are never considered title defects

The buyer must accept the encroachment because it has been there for years

The encroachment is a title defect that may be covered by extended title insurance and should be resolved through negotiation or legal action

The county automatically resolves all encroachments

#94. Under California law, the transfer of real property into a revocable living trust by the trustor:

Triggers a full reassessment of property taxes

Does not trigger reassessment of property taxes under Proposition 13 because the beneficial owner remains the same

Requires recording a new deed with the county

Is subject to documentary transfer taxes

#95. A closing statement shows the buyer owes $4,200 in prorated property taxes. This most likely means:

The buyer is paying a penalty for late tax payment

The seller has already paid taxes covering a period that extends beyond the closing date, and the buyer is reimbursing the seller for the post-closing portion

The buyer is prepaying next year’s taxes

The escrow company is collecting a fee

#96. Under California law, which of the following is TRUE about a special warranty deed?

It provides the same protection as a general warranty deed

It offers no warranties whatsoever

It warrants only against defects that occurred during the grantor’s period of ownership, not prior defects

It is the most common deed type in California

#97. Under California law, the key difference between judicial and non-judicial foreclosure is:

Judicial foreclosure is faster and less expensive

Non-judicial foreclosure requires court approval

There is no difference in California

Non-judicial foreclosure is handled by the trustee without court involvement and is faster (3-4 months vs 12-18 months for judicial)

#98. A property owner wants to ensure their heirs receive the property without going through probate. The BEST method is:

Placing the property in a revocable living trust

Writing an informal letter to the heirs

Recording a quitclaim deed without consideration

Filing a homestead declaration

#99. Under California law, the transfer of a parent’s primary residence to a child:

Is always subject to full reassessment

May be excluded from reassessment under Proposition 19 if the child uses it as a primary residence and within specified value limits

Requires a new appraisal by the county assessor

Is prohibited without court approval

#100. A buyer at closing receives a credit of $850 for rent proration. This means:

The buyer is paying the seller’s mortgage

The escrow company is refunding fees

The seller collected rent for a period extending beyond the closing date and must credit the buyer for the post-closing portion

The title company is reducing its charges

#101. Under California law, what happens when a property owner fails to pay property taxes for 5 consecutive years?

The property taxes are forgiven

The property is automatically transferred to the state

The county seizes the property without any sale process

The property may be sold at a tax sale by the county to recover the delinquent taxes

#102. A title insurance company discovers a forged deed in the chain of title. The effect is:

The forged deed is valid because it was recorded

Title insurance does not cover forgeries

The forgery renders the deed void, and the title insurance policy would cover the loss for the insured party

The forger automatically gains title to the property

#103. Under California law, a property tax proration using the actual days method requires:

Dividing the annual tax by 360 and multiplying by 30 days per month

Dividing the annual tax by 365 (or 366 for leap years) and multiplying by the number of days each party owned the property

Splitting the annual tax 50/50 between buyer and seller

Using the assessed value as the daily rate

#104. A buyer receives both an owner’s title insurance policy and the lender requires a lender’s policy. Which statement is CORRECT?

Both policies protect the buyer equally

The owner’s policy protects the buyer; the lender’s policy protects the lender. They provide separate coverages.

The lender’s policy replaces the owner’s policy

Only one policy is needed for both parties

#105. Under California law, a deed executed by a grantor who has been declared mentally incompetent by a court is:

Voidable at the grantor’s option

Void from the beginning because the grantor lacks legal capacity

Valid because the deed was signed

Enforceable if the grantee paid fair value

#106. A property is sold for $600,000 in a county with a documentary transfer tax rate of $1.10 per $1,000. The transfer tax is:

$660

$600

$6,600

$60

#107. Under California law, a recorded easement that benefits one property (dominant tenement) at the expense of another (servient tenement) is known as:

An easement in gross

An appurtenant easement

A prescriptive easement

A license

#108. A title search reveals that the property has a federal tax lien recorded against it. Before closing:

Federal tax liens are automatically released at closing

The federal tax lien must be satisfied or the parties must agree on how to address it to deliver clear title

The buyer must assume the federal tax lien

The lien has no effect on the title transfer

#109. Under California law, which of the following statements about the Closing Disclosure is TRUE?

It must be provided at least 30 days before closing

It must be provided to the buyer at least 3 business days before consummation of a mortgage loan

It is only required for cash purchases

It replaces the title insurance policy

#110. A property owner dies and leaves a will directing that the home go to their nephew. The executor:

Can immediately transfer the property without court involvement

Must sell the property at market value

Must go through probate to validate the will and transfer the property according to its terms

Can only transfer the property if all heirs agree

#111. Under California law, what is the purpose of the preliminary title report?

To inform the buyer of the current condition of the title, including any liens, encumbrances, and easements before closing

To set the property’s market value

To verify the property’s zoning classification

To calculate the property taxes

#112. A seller agrees to carry back a $200,000 second trust deed at 5% for 10 years. The trust deed is recorded. Recording:

Establishes the lender’s (seller’s) priority and provides constructive notice of the lien

Is optional for seller financing

Only benefits the buyer

Creates actual notice but not constructive notice

#113. Under California law, when multiple liens exist against a property, priority is generally determined by:

The size of the lien (largest has priority)

The identity of the lienholder

The order of recording, with the first recorded lien having the highest priority (except for property tax liens, which have super-priority)

The date the debt was incurred

#114. A property in California is sold for $750,000 with a transfer tax rate of $1.10 per $1,000 plus a local transfer tax of $3.30 per $1,000. The total transfer tax is:

$825

$2,475

$3,300

$7,500

#115. Under California law, a deed of trust contains a power of sale clause that allows:

The borrower to sell the property without the lender’s consent

The lender to take immediate possession upon default

The trustee to sell the property through non-judicial foreclosure if the borrower defaults

The government to seize the property for unpaid taxes

#116. A buyer discovers after closing that the seller did not have legal authority to convey the property (the seller was an imposter). The buyer’s title insurance:

Would not cover this type of loss

Would only cover half the purchase price

Would cover the loss because the deed was void due to fraud/forgery

Would require the buyer to sue the imposter first

#117. Under California law, the transfer of property from one spouse to the other during a marriage is:

Generally exempt from reassessment under Proposition 13 and from documentary transfer taxes

Subject to full reassessment

Taxed at a reduced rate

Prohibited without court approval

#118. A grant deed that fails to include a legal description of the property is:

Valid as long as the address is included

Generally invalid because a legal description is required to identify the property being conveyed

Valid if the parties know which property is intended

Valid if the deed is notarized

#119. Under California law, a prescriptive easement is acquired through:

Continuous, open, notorious, hostile, and exclusive use of another’s property for 5 years without the owner’s permission

Written agreement between property owners

Court order only

Payment of compensation to the property owner

#120. A title company issues a title insurance policy with an exception for a recorded utility easement. This means:

The title company will fix the easement issue

The title insurance policy will NOT cover losses related to the utility easement

The easement will be removed at closing

The buyer is guaranteed the easement will not affect property use

#121. Under California law, a property owner who wants to add their adult child to the deed should be aware that:

Adding a child to the deed is always free of tax consequences

Adding a child requires probate court approval

Adding a child to the deed may trigger partial reassessment and could have gift tax implications

A child can only be added through a will

#122. The purpose of a reconveyance deed in California is to:

Transfer property from seller to buyer in a standard sale

Foreclose on a defaulting borrower

Create a new lien against the property

Transfer the property from the trustee back to the borrower when the loan secured by the trust deed is paid in full

#123. Under California law, a property transferred as a gift is:

Subject to potential gift tax implications for the donor but generally not subject to income tax for the recipient

Always subject to income tax for the recipient

Exempt from all taxes

Subject to transfer taxes at double the normal rate

#124. A property is foreclosed through non-judicial foreclosure in California. The former owner:

Has a 1-year right of redemption

May redeem the property at any time within 90 days

Generally has NO right of redemption after a non-judicial trustee’s sale

Must petition the court for redemption rights

#125. Under California law, which of the following is TRUE about special assessments?

Special assessments are voluntary contributions

Special assessments only apply to commercial properties

Special assessments are charges for specific improvements (sidewalks, sewers) that benefit the property and create a lien if unpaid

Special assessments are included in the standard property tax rate

#126. A buyer purchases a property and immediately records the deed. The recording:

Guarantees the title is clear of all defects

Transfers legal title from the seller to the buyer (delivery does this)

Provides constructive notice to the world that the buyer is now the owner and establishes the buyer’s priority

Is optional and has no legal effect

#127. Under California law, an unrecorded deed between a grantor and grantee is:

Void and unenforceable

Only valid for 30 days

Valid and enforceable between the parties but does not provide constructive notice to third parties

Invalid because recording is required for the deed to take effect

#128. A property owner who dies intestate (without a will) and has no surviving relatives:

Has their property automatically go to the county

Has their property escheat to the state of California under intestate succession law

Has their property distributed by the DRE

Has their property remain vacant indefinitely

#129. Under California law, a mortgage differs from a trust deed primarily in that:

A mortgage is always better for the borrower

A trust deed provides more protection for the borrower

There is no practical difference

A mortgage involves only two parties (borrower and lender) and typically requires judicial foreclosure, while a trust deed involves three parties and allows non-judicial foreclosure

#130. A property sold for $500,000 has annual property taxes of $6,000. If closing occurs on September 1 and the buyer owns for 122 days (Sept 1 – Dec 31), the buyer’s prorated share is approximately:

$3,000

$3,995

$2,005

$6,000

#131. Under California law, the concept of ‘relation back’ in title insurance means:

The policy covers defects that occur after the policy date

The policy protects against defects that existed before the policy was issued, even if discovered later

The policy automatically extends to future owners

The policy relates back to the original construction date

#132. A title insurance company issues a commitment for title insurance. This commitment:

Sets forth the conditions under which the company will issue the title policy and lists any exceptions or requirements

Is the same as the final title insurance policy

Guarantees the title is clear

Is not binding on the title company

#133. Under California law, which of the following is NOT a requirement for adverse possession?

Occupation must be open and notorious

The adverse possessor must have the property owner’s written permission

Occupation must be continuous for 5 years

The adverse possessor must pay property taxes

#134. A property is transferred from a parent to a child through a grant deed. Under Proposition 19:

All parent-to-child transfers are excluded from reassessment regardless of use

The transfer of the parent’s primary residence may be excluded from reassessment if the child uses it as their primary residence and within value limits

The transfer is always fully reassessed

Parent-to-child transfers are prohibited

#135. Under California law, escrow funds may be released to the appropriate parties only when:

The buyer’s agent requests release

All conditions specified in the escrow instructions have been satisfied and both parties have consented

30 days have passed since opening escrow

The title company approves the release

#136. A property owner executes two deeds for the same property to different buyers. The first deed is delivered but not recorded; the second deed is delivered and recorded immediately. Under California’s race-notice recording statute:

The second buyer generally prevails because they recorded first and may have been a bona fide purchaser without notice of the first sale

The first buyer always prevails because they received the deed first

Both buyers share the property

The property reverts to the original owner

#137. Under California law, which of the following events does NOT require recording to be valid between the parties?

A lease for less than one year

A grant deed

A trust deed

A mechanics lien

#138. A property owner defaults on their property tax obligation. Under California law, delinquent property taxes:

Have no priority and are subordinate to all other liens

Become a lien on the property that has priority over virtually all other liens, including mortgages

Become a lien only after 3 years of delinquency

Are the responsibility of the previous owner only

#139. Under California law, the settlement process includes the preparation of:

Only the deed

A detailed accounting of all debits and credits for both buyer and seller, including prorated items and closing costs

Only the title report

Only the commission statement

#140. A property is conveyed to a buyer who discovers that the grantor’s name was misspelled on the deed. To correct this:

The original deed must be destroyed and reissued

The county recorder automatically corrects clerical errors

A corrective (correction) deed should be prepared and recorded to fix the error

The buyer must file a quiet title action

#141. Under California law, a tax lien sale differs from a trustee’s sale in that:

A trustee’s sale has priority over tax liens

Both sales are identical in procedure

Tax lien sales only occur in judicial proceedings

A tax lien sale results from unpaid property taxes and gives the government priority over all other liens, while a trustee’s sale results from mortgage default

#142. A property’s title report shows the property is subject to CC&Rs (Covenants, Conditions, and Restrictions). These:

Are recorded restrictions that limit how the property can be used and are binding on all future owners

Can be ignored by the buyer after purchase

Expire after 10 years

Only apply to the original developer

#143. Under California law, when prorating rent at closing for a rental property sold on March 15 with monthly rent of $3,000:

The seller credits the buyer approximately $1,548 for the 16 days remaining in March (16/31 x $3,000)

The seller keeps the full month’s rent

The buyer receives no credit for rent

The escrow company collects rent for the entire month

#144. A homeowner in California files a Declaration of Homestead. This provides protection against:

All foreclosure actions including mortgage default

Forced sale of the home to satisfy certain unsecured debts, up to the statutory homestead exemption amount

Property tax liens

Eminent domain proceedings

#145. Under California law, constructive delivery of a deed occurs when:

The deed is handed directly to the grantee

The deed is mailed to the grantee

The deed is signed by the grantor

The grantor’s actions demonstrate an intent to transfer ownership even though physical delivery to the grantee has not occurred, such as recording the deed

#146. A property in a probate sale receives an overbid at the confirmation hearing. Under California probate law:

Overbids are not permitted in probate sales

The original buyer has an absolute right to purchase at their original offer price

The executor decides whether to accept the overbid

The property may be sold to the highest bidder at the confirmation hearing, which may be someone other than the original buyer

#147. Under California law, the transfer of real property by operation of law includes all of the following EXCEPT:

Foreclosure

Eminent domain

Intestate succession

A voluntary sale between buyer and seller

#148. A title insurance company’s policy contains a schedule of exclusions. These exclusions:

Include all possible title defects

List specific items the policy does NOT cover, such as known defects, governmental regulations, and defects created by the insured

Only apply to commercial properties

Can be removed by paying an additional premium in all cases

#149. Under California law, recording fees are:

Charged by the county recorder for filing documents in the public records and vary by county

Set uniformly throughout California by the DRE

Always paid by the buyer

Included in the title insurance premium

#150. A property closing is delayed because the title company discovers a judgment lien that the seller was unaware of. The seller must:

Clear the judgment lien before closing can proceed, either by paying it off or negotiating with the judgment creditor

Ignore the lien because the seller was unaware of it

Transfer the lien obligation to the buyer automatically

File a complaint with the DRE against the judgment creditor

#151. Under California law, which type of deed is used by a trustee conducting a non-judicial foreclosure sale?

Grant deed

Warranty deed

Trustee’s Deed Upon Sale

Quitclaim deed

#152. A buyer closes on a property where annual taxes of $5,475 have been prepaid by the seller for the full calendar year. Closing is April 1 (seller owned 90 days). The buyer owes the seller a credit of approximately:

$1,350

$5,475

$2,737.50

$4,125 for the remaining 275 days

#153. Under California law, a standard coverage title insurance policy covers:

Survey errors and encroachments

Defects found in public records, forged documents, incompetent grantors, and incorrect marital statements

Unrecorded liens and off-record risks

Mining claims and water rights

#154. A property is sold subject to an existing mortgage. This means:

The buyer assumes personal liability for the existing mortgage

The mortgage is automatically paid off at closing

The buyer takes the property with the existing mortgage remaining in place, but the original borrower remains liable

A new mortgage replaces the existing one

#155. Under California law, recording a lis pendens:

Automatically prevents the sale of the property

Transfers title to the plaintiff

Eliminates all liens on the property

Provides constructive notice that a lawsuit affecting the property has been filed, warning potential buyers

#156. A property’s closing statement shows a debit to the seller of $2,400 for transfer taxes. At a rate of $1.10 per $1,000, the approximate sale price is:

$2,640,000

$240,000

$2,181,818

$2,400,000

#157. Under California law, an extended coverage (ALTA) title insurance policy differs from standard coverage by:

Only covering a longer time period

Including protection against unrecorded liens, encroachments, survey errors, and rights of parties in possession

Being available only for commercial properties

Providing lower premiums

#158. A buyer receives a grant deed with the following covenant: ‘Subject to all existing easements of record.’ This means:

The buyer can eliminate the easements after closing

The buyer takes the property subject to any easements that have been recorded in the public records

No easements exist on the property

The easements will expire within 5 years

#159. Under California law, a property transferred through a will is distributed according to:

Intestate succession

The county assessor’s determination

Testate succession, with the probate court overseeing the process

The DRE’s recommendation

#160. A buyer closes on a property where the seller has not paid the current year’s property taxes. The closing statement will show:

A debit to the buyer for all property taxes

No adjustment because taxes are paid at year-end

A credit to the buyer for the seller’s share of unpaid property taxes covering the seller’s period of ownership

A credit to the seller for prepaid taxes

#161. Under California law, a corrective deed is used when:

The property is being transferred to a new owner

A previously recorded deed contains an error such as a misspelled name or incorrect legal description that needs to be corrected

The original deed is lost

The property has been rezoned

#162. A buyer’s title insurance policy shows a Schedule B exception for ‘rights of tenants in possession.’ This means:

All tenant rights are automatically terminated at closing

The policy does not cover claims by current tenants or occupants of the property; the buyer should investigate tenant occupancy

The policy fully covers tenant-related issues

Tenants must vacate before the policy is issued

#163. Under California law, when property is held in joint tenancy and one owner dies:

The deceased’s interest goes through probate

The deceased’s interest passes to their heirs under their will

The property must be sold and proceeds divided

The deceased’s interest passes automatically to the surviving joint tenant(s) through right of survivorship, avoiding probate

#164. A property closes on October 15 with annual insurance paid through December 31 ($1,200/year). The seller is entitled to a credit from the buyer of approximately:

$1,200

$600

$947

$253 for the 77 remaining days of coverage (Oct 15 – Dec 31)

#165. Under California law, which of the following is TRUE about title insurance premiums?

Title insurance premiums are typically paid once at closing and provide coverage for as long as the insured owns the property

Title insurance premiums are paid annually like homeowners insurance

Title insurance premiums are regulated by the DRE at fixed rates

Title insurance premiums are always paid by the buyer

#166. A deed contains the words ‘grants, bargains, and sells.’ Under California law, this language:

Creates the same warranties as a warranty deed

Provides no warranties

Is only valid in quitclaim deeds

Creates implied warranties found in a grant deed under Civil Code §1092

#167. Under California law, a buyer who assumes an existing mortgage:

Has no personal liability for the loan

Must refinance the loan within 90 days

Takes personal liability for the loan and agrees to make payments under the existing loan terms

Automatically qualifies for a lower interest rate

#168. A closing statement shows the buyer’s total debits are $505,000 and total credits are $450,000. The buyer must bring to closing:

$505,000

$450,000

$955,000

$55,000

#169. Under California law, a notice of default is the first step in:

The non-judicial foreclosure process under a trust deed

The probate process

Recording a new deed

Filing an eminent domain action

#170. A title search reveals that a previous owner’s divorce decree awarded the property to one spouse, but no deed was recorded transferring the interest. This creates:

No issue because the divorce decree is sufficient

An automatic transfer that does not require recording

A cloud on the title that must be resolved before the property can be conveyed with clear title

A title defect that only affects the divorced couple

#171. Under California law, the closing agent must ensure that:

All conditions of the purchase agreement are satisfied before disbursing funds and recording the deed

Only the buyer’s conditions are satisfied

The property passes inspection

The appraised value matches the purchase price

#172. A property sold for $400,000 in a city that imposes a city transfer tax of $3.30 per $1,000 in addition to the county transfer tax of $1.10 per $1,000. The total transfer tax is:

$1,760

$440

$1,320

$4,400

#173. Under California law, the reinstatement period during non-judicial foreclosure allows the borrower to:

Renegotiate the loan interest rate

Cure the default by paying all past-due amounts plus costs and fees, reinstating the original loan terms

Sell the property at auction

Transfer the property to a family member

#174. A property’s title report lists a recorded CC&R that restricts the property to residential use only. The buyer plans to operate a home business. The buyer should:

Ignore the CC&Rs because they are outdated

Assume the CC&Rs are unenforceable

Review the CC&Rs carefully and consult legal counsel to determine if the home business would violate the restriction

Record a new deed without the restriction

#175. Under California law, which of the following statements about deeds is TRUE?

A signed deed automatically transfers title

A deed must be delivered and accepted to be effective; mere signing is not sufficient to transfer title

A deed must be recorded to be valid between the parties

A deed is effective when notarized

#176. A property is sold subject to a deed of trust. The seller’s closing statement shows a payoff of the existing loan. The payoff amount includes:

The remaining principal balance, accrued interest, and any prepayment penalties or fees

Only the original loan amount

Only the remaining principal balance

The original loan amount plus all interest paid to date

#177. Under California law, an escrow holder who discovers a discrepancy in the closing figures must:

Notify all parties and resolve the discrepancy before disbursing funds

Proceed with closing and adjust later

Report to the DRE immediately

Choose which party’s figures to use

#178. A property is being foreclosed through judicial foreclosure in California. The borrower has:

No right of redemption

A 30-day right of redemption only

An unlimited right of redemption

A right of redemption for up to one year after the judicial foreclosure sale (or 3 months if proceeds cover the debt)

#179. Under California law, a life estate:

Grants the holder the right to use and enjoy the property during their lifetime, with the property reverting to the remainderman upon death

Grants permanent ownership

Is the same as fee simple absolute

Can only be created by court order

#180. A title insurance claim is filed when a buyer discovers an undisclosed lien from a previous owner. The title insurance company will:

Automatically deny the claim

Require the buyer to cure the defect personally

Increase the buyer’s premium

Investigate the claim and either cure the defect, negotiate a settlement, or compensate the insured up to the policy limits

#181. Under California law, a property sold at a trustee’s sale (non-judicial foreclosure):

Includes a full warranty from the lender

Comes with a 1-year warranty from the trustee

Is sold on an ‘as-is’ basis with no warranties, and the buyer receives a trustee’s deed upon sale

Includes an inspection contingency for the buyer

#182. A seller provides a grant deed at closing. After recording, the buyer discovers that an easement not disclosed by the seller was created during the seller’s ownership. Under the grant deed warranties:

The seller is responsible because the grant deed warrants the property is free from encumbrances created by the grantor except those disclosed

The buyer has no recourse because the deed was recorded

The title company is responsible

The seller is responsible only if the easement reduces value by more than $10,000

#183. Under California law, the notice of trustee’s sale must be:

Only mailed to the borrower

Only recorded with the county

Published in a legal journal 90 days before the sale

Published, posted on the property, and recorded at least 20 days before the sale

#184. A closing statement for a buyer shows the following credits: purchase price deposit $25,000, loan proceeds $375,000. The buyer’s total credits are:

$375,000

$25,000

$350,000

$400,000

#185. Under California law, which of the following is TRUE about a sheriff’s deed?

It provides the same warranties as a grant deed

It is only used for commercial properties

It is issued by the county assessor

It is issued after a judicial foreclosure sale and conveys whatever interest the foreclosed owner had in the property

#186. A property’s assessed value under Proposition 13 is $250,000. The maximum assessed value for the following year (without a change in ownership or new construction) is:

$275,000 (10% maximum increase)

$262,500 (5% maximum increase)

$250,000 (no increase allowed)

$255,000 (2% maximum increase)

#187. Under California law, a transfer on death (TOD) deed allows:

An immediate transfer of property to the beneficiary

The property to be sold at auction upon the owner’s death

A property owner to designate a beneficiary who will receive the property upon the owner’s death without probate

The property to transfer to the state upon the owner’s death

#188. A buyer’s closing statement shows debits for: purchase price $500,000, closing costs $8,000, and prorated taxes $1,200. Total debits are:

$500,000

$508,000

$509,200

$501,200

#189. Under California law, the period after a notice of default during which the borrower may reinstate the loan by curing the default is:

Generally 3 months (approximately 90 days) from the recording of the notice of default

30 days

6 months

1 year

#190. A property sold for $300,000 has annual property taxes of $3,600. Closing is March 31 (seller owned 90 days out of 365). The seller’s prorated share is:

$1,800

$2,712.33

$887.67

$3,600

#191. Under California law, a trust deed’s due-on-sale clause:

Requires the borrower to sell the property

Prevents the borrower from ever selling the property

Only applies to commercial loans

Allows the lender to accelerate the loan and demand full payment if the borrower transfers the property without the lender’s consent

#192. A buyer purchases title insurance that covers $450,000 (the purchase price). Ten years later, the property is worth $700,000 and a title defect is discovered. The buyer’s coverage is:

Automatically adjusted to $700,000

Always equal to the current market value

$0 because the policy expired after 10 years

Limited to the original policy amount of $450,000 unless an inflation rider was purchased

#193. Under California law, which of the following is TRUE about the order of lien priority?

The largest lien always has the highest priority

Property tax liens have super-priority and take precedence over all other liens regardless of recording date

All liens have equal priority

Private liens always have priority over government liens

#194. A property is sold and the deed is recorded. Three days later, a previously unknown heir of a former owner claims an interest in the property. The buyer’s title insurance:

Would not cover this type of claim

Would only cover if the claim exceeds $50,000

Would require the buyer to litigate before providing coverage

Should cover this claim because it is a defect in the chain of title existing before the policy date

#195. Under California law, a grant deed that is properly executed and delivered but never recorded:

Is completely void

Is valid for only 90 days

Must be notarized to be valid between the parties

Is valid between the grantor and grantee but may not protect the grantee against claims from subsequent good-faith purchasers who record first

#196. A property is sold subject to existing CC&Rs that restrict the height of structures to one story. The buyer who builds a two-story addition may face:

Legal action from the HOA or neighbors to enforce the CC&R restriction, potentially requiring removal of the non-conforming construction

No consequences because CC&Rs expire after 10 years

Only a small fine from the city

Automatic approval if the city issues a building permit

#197. Under California law, a beneficiary statement from the lender provides:

A recommendation to buy the property

Information about the current balance, interest rate, and status of the existing loan secured by the property

An appraisal of the property’s value

The property’s title insurance policy

#198. A closing statement credit to the seller for prepaid property taxes means:

The seller is receiving a tax refund from the county

The buyer is paying the seller’s future taxes

The government is subsidizing the seller

The seller has already paid taxes for a period extending beyond the closing date, and the buyer is reimbursing the seller for the post-closing portion

#199. Under California law, which of the following is TRUE about a subordination agreement?

It automatically eliminates the earlier lien

It changes the priority of liens, allowing a later-recorded lien to take priority over an earlier one with the consent of the earlier lienholder

It is only used in commercial transactions

It requires court approval

#200. A buyer purchases a property with a title insurance policy that contains an exclusion for ‘matters which would be revealed by a survey.’ If a survey later reveals an encroachment:

The title insurance policy would NOT cover the encroachment because it was specifically excluded

The title insurance company must pay regardless of the exclusion

The buyer can sue the title company for the exclusion

The exclusion is automatically void

#201. Which deed is most commonly used in California residential real estate transactions?

Quitclaim deed

Grant deed

Warranty deed

Trust deed

#202. A quitclaim deed differs from a grant deed in that a quitclaim deed:

Provides implied warranties that the property has not been previously sold

Guarantees the title is completely free from defects

Transfers only whatever interest the grantor currently holds without any warranties

Secures a loan as collateral

#203. Under California Civil Code §1092, a grant deed contains which of the following implied warranties?

The property is guaranteed to appreciate in value

The property has not been previously conveyed and is free from encumbrances created by the grantor except those disclosed

The grantor will defend the title against all future claims

The property complies with all current building codes

#204. For a deed to be valid in California, which of the following is required?

The deed must be notarized and recorded

The deed must be signed by both the grantor and grantee

The deed must be approved by the DRE

The deed must be in writing, signed by the grantor, and describe the property using a legal description

#205. Recording a deed with the county recorder’s office establishes:

Actual notice to all parties in the transaction

A guarantee that the title is clear

Constructive notice of the transfer, which protects the buyer against subsequent claims

The exact market value of the property

#206. John purchases a property and receives a grant deed but delays recording for 2 weeks. During that time, the seller fraudulently conveys the same property to Mary, who records immediately. Under California recording law:

John has priority because he purchased first

Mary has priority rights because she recorded first, establishing constructive notice

Both buyers share equal rights to the property

The deed is void because of the fraud

#207. A warranty deed provides which level of protection to the grantee?

Limited protection covering only defects created by the grantor

No protection or warranties of any kind

Protection only against liens created in the last 5 years

The highest level, guaranteeing the title is completely free from defects throughout the entire property history

#208. A trust deed in California involves three parties. They are:

Buyer, seller, and agent

Grantor, grantee, and notary

Principal, agent, and subagent

Trustor (borrower), beneficiary (lender), and trustee (neutral third party)

#209. Which of the following is TRUE about title insurance in California?

Title insurance protects against losses from undiscovered historical defects existing before the policy date

Title insurance covers future events such as fire or natural disasters

Title insurance is required by state law for all transactions

Title insurance replaces the need for a title search

#210. The difference between a marketable title and an insurable title is:

They are the same thing

A marketable title requires insurance; an insurable title does not

A marketable title is free from significant defects; an insurable title has known defects that title insurance will cover

An insurable title is always superior to a marketable title

#211. Under California law, which of the following transfer methods occurs WITHOUT the owner’s consent?

A sale between a willing buyer and seller

Foreclosure due to mortgage default

A gift from parent to child

An exchange of properties between two owners

#212. Adverse possession in California requires all of the following EXCEPT:

Open and notorious occupation

Continuous possession for 5 years

Written permission from the property owner

Payment of property taxes during the period of possession

#213. Under the California Probate Code, if a person dies without a valid will:

Property is distributed according to California’s intestate succession laws, with the surviving spouse receiving the largest share

The state automatically takes ownership of all property

All property goes to the oldest child

The property is distributed equally among all living relatives

#214. Non-judicial foreclosure in California is typically completed within:

12-18 months

30 days

24 months

3-4 months

#215. The probate process in California serves to:

Transfer property without court involvement

Validate the will, settle debts, and distribute the deceased’s assets under court supervision

Eliminate property taxes for inherited property

Automatically transfer title to the surviving spouse

#216. Eminent domain requires the government to provide:

Free replacement property

Tax credits for 10 years

Just compensation to the property owner based on fair market value

Approval from the property owner

#217. An escrow agent in California acts as:

A neutral fiduciary holding funds and documents until all transaction conditions are satisfied

An advocate for the buyer only

A representative of the lender

An appraiser of the property

#218. Under California Financial Code §17000, escrow holders are required to:

Invest client funds for maximum return

Represent the buyer’s interests exclusively

Determine the property’s market value

Maintain segregated trust accounts, provide detailed accounting, and carry errors and omissions insurance

#219. A proration of property taxes ensures that:

The buyer pays all property taxes for the entire year

The seller pays all property taxes for the entire year

Each party pays their proportionate share of taxes based on the number of days they own the property

Property taxes are waived during the year of sale

#220. If annual property taxes are $3,650 and closing is July 1, with the seller owning from January 1 to June 30 (181 days), the seller’s share of property tax is approximately:

$1,825

$3,650

$1,810

$1,000

#221. California transfer taxes are imposed on the conveyance of property at rates typically ranging from:

A flat fee of $100 per transaction

0.5% to 1.1% of the sale price, varying by county

5% of the sale price

10% of the assessed value

#222. Which of the following correctly describes the chain of title?

The physical chain used to survey property boundaries

A legal document filed with the DRE

A chronological record of all transfers of ownership for a property

The sequence of mortgage payments made by the owner

#223. Under California law, a buyer who receives a grant deed is protected against:

All title defects regardless of when they occurred

Future zoning changes

Property value declines

Encumbrances created by the grantor that were not disclosed

#224. A seller offers a quitclaim deed in a standard residential sale. A buyer’s agent should advise the buyer to:

Accept the quitclaim deed because it is standard in California

Insist on a grant deed and obtain title insurance because a quitclaim deed provides no warranties

Only accept if the property is under $100,000

Request a warranty deed instead of a grant deed

#225. The recording process in California is governed by:

California Code of Civil Procedure §690 et seq.

California Civil Code §1092

California Revenue and Taxation Code §11900

California Financial Code §17000

#226. Under California law, which of the following statements about constructive notice is TRUE?

Constructive notice requires personal delivery of the document to all interested parties

Constructive notice is only created by newspaper publication

Unrecorded documents create constructive notice

Recording a document with the county recorder creates constructive notice, meaning the public is deemed to know about it even if they haven’t personally seen it

#227. A quiet title action is used to:

Reduce property taxes

Eliminate mortgage obligations

Transfer property without a deed

Resolve disputes about property ownership and establish clear title through a court proceeding

#228. Under California probate law, a simplified probate procedure is available for estates valued at less than:

$184,500 (as adjusted periodically)

$500,000

$1,000,000

$50,000

#229. Which of the following is TRUE about an owner’s title insurance policy?

It protects the lender against borrower default

It guarantees the property will appreciate in value

It covers losses from future events

It protects the buyer against losses from defects in the title that existed before the policy date

#230. A lender’s title insurance policy:

Protects the buyer from title defects

Protects the lender against title defects that could affect the lender’s security interest in the property

Covers the buyer and lender equally

Is the same as the owner’s policy

#231. Under California law, which of the following is NOT a method of voluntary property transfer?

Adverse possession

Sale of property

Gift of property

Transfer through a will

#232. A title search reveals a gap in the chain of title. This indicates:

The property has been properly maintained

No issues exist with the title

A potential problem that may require legal action to resolve before the property can be conveyed with clear title

The property taxes have been paid

#233. Under California Revenue and Taxation Code §11900, transfer taxes are typically paid by:

Always the buyer

The seller, though parties can negotiate in the contract

The county recorder

The title company

#234. A property is being sold and the seller has not yet paid the annual property taxes of $4,380. Closing is August 15. Using 365 days, the seller’s share (Jan 1-Aug 14, 226 days) is approximately:

$2,712

$2,190

$4,380

$1,668

#235. Under California law, notarization of a deed is:

Not legally required for validity but is standard practice and facilitates recording

Required by law for all deeds

Only required for quitclaim deeds

Only required for properties over $500,000

#236. Which of the following is TRUE about the relationship between title insurance and warranty deeds in California?

Warranty deeds are preferred over title insurance

Title insurance has largely replaced warranty deeds because it provides broader protection without making the seller personally liable

Title insurance and warranty deeds serve the same function

Warranty deeds are required when title insurance is not available

#237. Under California law, the executor of a will is responsible for:

Purchasing new property for the heirs

Conducting a title search on all properties

Appraising all real property in the estate

Inventorying assets, settling debts, paying estate taxes, and distributing property per the will’s instructions

#238. A cloud on title can be caused by all of the following EXCEPT:

An outstanding mechanic’s lien

A properly recorded and satisfied mortgage

A disputed boundary line

A pending lawsuit against the property owner

#239. Under California law, which of the following is TRUE about the probate sale of real property?

Probate sales are faster than standard sales

Probate sales do not require title insurance

Probate sales are exempt from disclosure requirements

Probate sales require court approval and specific procedures, including potential overbidding in court

#240. Constructive notice differs from actual notice in that:

Constructive notice requires personal delivery

Actual notice is always established by recording

There is no legal distinction between the two

Constructive notice is established by recording and is presumed regardless of personal knowledge, while actual notice is direct knowledge of a fact

#241. A deed in lieu of foreclosure occurs when:

The lender forecloses through the court system

The borrower sells the property at auction

The trustee conducts a non-judicial foreclosure

The borrower voluntarily transfers the property to the lender to avoid the foreclosure process

#242. Under California law, which of the following is required for a valid will?

The will must be notarized

The will must be in writing, signed by the testator, and witnessed by at least two disinterested parties

The will must be filed with the DRE

The will must be approved by the probate court before the testator’s death

#243. A property owner dies with a valid will leaving the home to a specific beneficiary. The transfer occurs through:

Testate succession under probate court supervision

Intestate succession

Adverse possession

Eminent domain

#244. Under California law, a trust deed allows for which type of foreclosure?

Non-judicial foreclosure conducted by the trustee, which is faster and less costly than judicial foreclosure

Only judicial foreclosure through the court system

Administrative foreclosure by the DRE

Voluntary foreclosure by the borrower

#245. The settlement statement (closing statement) in a real estate transaction:

Details all financial aspects including purchase price, closing costs, prorations, and adjustments for both buyer and seller

Only shows the purchase price

Is prepared by the buyer’s agent

Is not required in California transactions

#246. Under California law, the buyer’s share of prorated property taxes at closing:

Covers the entire tax year

Covers the period from the closing date through the end of the tax period

Is always zero because the seller pays all taxes

Is determined by the buyer’s lender

#247. A title company discovers that a previous deed in the chain of title was signed by a minor. This is:

Not a concern because all deeds are valid regardless of the signer’s age

Only a problem if the minor is now an adult

A defect that cannot be cured

A potential title defect because contracts signed by minors may be voidable

#248. Under California law, an abstract of title:

Is the same as a title insurance policy

Guarantees the title is clear

Is a summary of all recorded documents affecting the property’s title, including deeds, liens, and encumbrances

Is prepared by the escrow company

#249. Which of the following statements about recording priority is CORRECT?

Generally, the first document recorded has priority over subsequently recorded documents (first in time, first in right)

The last document recorded has priority

Priority is determined by the document’s date of execution, not recording

Recording priority is determined by the DRE

#250. Under California law, a property transferred through a gift requires:

Only a verbal declaration of intent

A court order approving the transfer

A deed (grant or gift deed) that meets all statutory requirements for a valid conveyance

Payment of the full market value in consideration

#251. A homestead declaration in California:

Eliminates all property taxes

Prevents the government from exercising eminent domain

Automatically transfers the property to the homeowner’s heirs

Provides limited protection against forced sale of the property to satisfy certain debts

#252. Under California law, which of the following is TRUE about the transfer tax exemption?

Certain transfers such as gifts, interspousal transfers, and transfers to trusts may be exempt from documentary transfer taxes

No transfers are exempt from transfer taxes

Only government transfers are exempt

Transfers under $100,000 are automatically exempt

#253. A title search reveals an unrecorded easement that allows a utility company to access the property. Under California law:

Unrecorded easements are never valid

The easement may still be valid and enforceable even though it is not recorded, especially if it was created by necessity or prescription

The easement is only valid if the buyer agrees to it

Unrecorded easements automatically terminate after 5 years

#254. Under California law, rent proration at closing ensures that:

The buyer pays all rent for the month of closing

Rent is not prorated in California transactions

If the property is a rental, the seller credits the buyer for any rent collected for the period after the closing date

The seller keeps all rent collected regardless of the closing date

#255. A trust used to hold real property in California:

Avoids probate and allows for private transfer of property according to the trust terms

Requires probate court approval for all transfers

Eliminates property taxes on the transferred property

Must be filed with the DRE

#256. Under California law, the Closing Disclosure (required by TRID for mortgaged properties) must be provided to the buyer:

At the time of closing

Within 30 days after closing

At least 3 business days before the consummation of the loan

Only if the buyer requests it

#257. A property owner executes a grant deed but never delivers it to the grantee. Under California law:

The deed is not effective because delivery and acceptance are required to transfer title

The deed is effective as soon as it is signed

Recording is the only requirement for the deed to be effective

The deed is effective if the grantor intended to transfer the property

#258. Under California law, which of the following correctly describes the doctrine of constructive notice?

Constructive notice requires the document to be published in a newspaper

Constructive notice only applies to deeds, not liens

Constructive notice is created by verbal announcements at a public meeting

Once a document is properly recorded, all persons are deemed to have notice of its contents regardless of actual knowledge

#259. A buyer at closing discovers that the seller’s grant deed contains an error in the legal description. The buyer should:

Accept the deed with the error because it can be corrected later

File a lawsuit against the title company

Record the deed with the error and hope no one notices

Request a correction deed (corrective deed) from the seller to fix the error before recording

#260. Under California law, a lis pendens is:

A type of deed

A recorded notice that a lawsuit has been filed involving the property, warning potential buyers of the pending litigation

A notice of property tax delinquency

A building permit application

#261. Which of the following statements about title insurance coverage is CORRECT?

Standard and extended coverage provide the same protection

Extended coverage only adds flood insurance

Standard coverage includes surveying errors

A standard coverage policy covers risks found in public records; an extended coverage policy adds protection for risks such as encroachments and unrecorded liens

#262. Under California law, a deed executed by a person under duress is:

Void from the beginning

Voidable at the option of the person who was under duress

Valid because all signed deeds are enforceable

Only voidable with DRE approval

#263. A property in California is sold at a tax sale because the owner failed to pay property taxes. The new buyer at the tax sale receives:

A warranty deed with full guarantees

A grant deed with all standard warranties

Automatic clear title with no encumbrances

A tax deed that may be subject to the former owner’s right of redemption for a specified period

#264. Under California law, the buyer and seller each receive a copy of the settlement statement:

Only after the transaction is recorded

Only if they request it

Within 30 days after closing

Before closing for review, allowing them to verify all charges and credits before funds are disbursed

#265. A property owner places property in a living trust. Under California law:

The transfer triggers reassessment of property taxes

The transfer to the trust avoids probate and is generally exempt from documentary transfer taxes and reassessment under Proposition 13

The transfer requires probate court approval

The property cannot be sold while in the trust

#266. Under California law, the documentary transfer tax is calculated based on:

Only the down payment amount

The assessed value of the property

The difference between the sale price and the original purchase price

The total value of the consideration (purchase price) or the fair market value of the property

#267. A buyer purchases a property at a judicial foreclosure sale. Under California law:

The former owner may have a right of redemption, allowing them to reclaim the property by paying the full sale price plus costs within a specified period

The former owner has no rights after the judicial sale

Judicial foreclosure sales provide no redemption rights

The buyer receives a quitclaim deed

#268. Under California law, which of the following is TRUE about joint tenancy and the right of survivorship?

When one joint tenant dies, their interest automatically passes to the surviving joint tenant(s) without probate

Joint tenancy interests pass through probate

Joint tenancy requires a will to specify distribution

Joint tenancy interest passes to the deceased’s children

#269. A grantor signs a deed and places it in a safe deposit box with instructions to deliver it to the grantee after the grantor’s death. Under California law:

The deed is valid because the grantor intended to transfer ownership

The deed is effective upon the grantor’s death

The deed is generally NOT valid because proper delivery requires the grantor to relinquish control during their lifetime

The bank can deliver the deed as instructed

#270. Under California law, homestead protection amounts vary based on:

The homeowner’s circumstances, including age, disability status, and household composition, with the minimum amount set at $300,000

The property’s assessed value only

The number of rooms in the home

The homeowner’s income level

#271. A mechanic’s lien in California:

Requires court approval before being filed

Is only valid for government projects

Expires after 30 days regardless of payment

Gives a contractor or laborer a security interest in the property for unpaid work or materials

#272. Under California law, a property is transferred through intestate succession when:

The property owner dies without a valid will, and the property passes to heirs according to state law

The property owner creates a trust

The property is sold at auction

The property is gifted to a charity

#273. A title insurance policy’s coverage amount typically:

Increases annually with inflation

Decreases as the mortgage is paid down

Equals the purchase price at the time of purchase and does not increase unless the policy is updated or reissued

Covers unlimited amounts regardless of purchase price

#274. Under California law, an escrow agent may NOT:

Release funds without satisfying all conditions of the escrow instructions from both parties

Hold funds in a neutral account

Provide copies of documents to both parties

Coordinate with the title company

#275. Which of the following statements about deed delivery in California is CORRECT?

A deed is effective as soon as it is signed

Delivery is not required if the deed is notarized

A deed must be delivered by the grantor and accepted by the grantee with the intent to transfer ownership for the transfer to be complete

The county recorder delivers all deeds

#276. Under California law, a property sold through eminent domain must be appraised:

At the original purchase price

At the assessed value for tax purposes

At fair market value to determine just compensation for the property owner

By the government agency acquiring the property

#277. A buyer purchases property and discovers after closing that an undisclosed easement exists. The buyer’s recourse depends on:

The type of deed received and whether the buyer has title insurance covering the undisclosed easement

The property’s assessed value

The seller’s current income

Whether the buyer conducted a home inspection

#278. Under California law, the statutory period for adverse possession is:

10 years

3 years

20 years

5 years of continuous, open, notorious, hostile, and exclusive possession with payment of taxes

#279. A title company issues a preliminary title report that shows a judgment lien against the seller. Before closing:

The lien must be satisfied or addressed to deliver clear title as required by the purchase agreement

The buyer must accept the property with the lien

The lien automatically expires after 30 days

The title company must pay off the lien

#280. Under California law, what happens to a joint tenancy when one joint tenant sells their interest to a third party?

The joint tenancy continues with the new owner

The entire property must be sold

The joint tenancy is severed as to the selling tenant’s share, creating a tenancy in common between the new owner and the remaining joint tenant(s)

The remaining joint tenants must approve the sale

#281. A property is transferred by a court order as part of a divorce settlement. This type of transfer:

Requires a warranty deed

Is typically done using a quitclaim deed or interspousal transfer deed and is generally exempt from documentary transfer taxes

Must go through probate

Is subject to the same transfer taxes as a regular sale

#282. Under California law, which of the following is TRUE about documentary transfer tax rates?

The rate is uniform throughout California at exactly 1%

The standard county rate is $1.10 per $1,000 of value (or consideration), with some cities imposing additional transfer taxes

Transfer tax rates are set by the federal government

Only properties over $1 million are subject to transfer taxes

#283. A deed that omits the grantee’s name is:

Valid as long as the grantor’s name is included

Valid if the property is properly described

Generally invalid because a grantee must be identified or identifiable for the deed to effectively transfer title

Valid because the county recorder will add the name

#284. Under California law, which of the following events triggers a reassessment of property value for tax purposes under Proposition 13?

An annual inflation adjustment above 2%

A request by the property owner

A change in the county assessor

A change in ownership or new construction

#285. A buyer at a non-judicial foreclosure sale in California:

Receives a warranty deed with full protections

Receives a trustee’s deed upon sale and the former owner generally has no right of redemption

Has a mandatory 1-year waiting period before taking possession

Must obtain the former owner’s consent before moving in

#286. Under California law, the escrow process typically concludes when:

All conditions of the escrow instructions are satisfied, funds are disbursed, and the deed is recorded with the county recorder

The buyer signs the purchase agreement

The seller accepts the buyer’s offer

The home inspection is completed

#287. A property’s title is found to have an unrecorded mechanics lien. Under California law:

Unrecorded mechanics liens are never enforceable

The lien is only valid for 30 days

The mechanics lien may still be enforceable against the property even though it was not recorded, depending on when the work was performed

Only recorded liens affect title

#288. Under California law, escheat occurs when:

A property owner dies without a will and without any identifiable heirs, and the property passes to the state

The government exercises eminent domain

A property is abandoned by the owner

The property taxes are not paid for 5 years

#289. A settlement statement shows a credit to the buyer for property taxes. This credit means:

The seller owes money for property taxes covering the seller’s period of ownership, which is credited to the buyer at closing

The buyer is receiving a discount on the purchase price

The government is subsidizing the buyer’s taxes

The escrow company is paying the buyer’s taxes

#290. Under California law, a grant deed must contain which of the following to be valid?

The grantee’s signature

The purchase price

A granting clause, property description, and the grantor’s signature

The date of the original construction

#291. Which of the following is TRUE about California’s Proposition 19 regarding property tax transfers?

It eliminates property taxes for all seniors

It freezes property taxes at 1978 levels for all homeowners

It only applies to commercial property transfers

It allows eligible homeowners (over 55, disabled, or disaster victims) to transfer their tax base to a replacement property anywhere in California up to three times

#292. Under California law, a deed recorded out of sequence (e.g., a later transfer recorded before an earlier one) affects:

Nothing, because execution date always determines priority

Only the title insurance coverage

Recording priority, as the first recorded document generally has priority regardless of the order of execution

Only commercial property transfers

#293. A buyer discovers that the property has an encroachment (the neighbor’s fence extends 2 feet onto the property). Under California law:

Encroachments are never considered title defects

The buyer must accept the encroachment because it has been there for years

The encroachment is a title defect that may be covered by extended title insurance and should be resolved through negotiation or legal action

The county automatically resolves all encroachments

#294. Under California law, the transfer of real property into a revocable living trust by the trustor:

Triggers a full reassessment of property taxes

Does not trigger reassessment of property taxes under Proposition 13 because the beneficial owner remains the same

Requires recording a new deed with the county

Is subject to documentary transfer taxes

#295. A closing statement shows the buyer owes $4,200 in prorated property taxes. This most likely means:

The buyer is paying a penalty for late tax payment

The seller has already paid taxes covering a period that extends beyond the closing date, and the buyer is reimbursing the seller for the post-closing portion

The buyer is prepaying next year’s taxes

The escrow company is collecting a fee

#296. Under California law, which of the following is TRUE about a special warranty deed?

It provides the same protection as a general warranty deed

It offers no warranties whatsoever

It warrants only against defects that occurred during the grantor’s period of ownership, not prior defects

It is the most common deed type in California

#297. Under California law, the key difference between judicial and non-judicial foreclosure is:

Judicial foreclosure is faster and less expensive

Non-judicial foreclosure requires court approval

There is no difference in California

Non-judicial foreclosure is handled by the trustee without court involvement and is faster (3-4 months vs 12-18 months for judicial)

#298. A property owner wants to ensure their heirs receive the property without going through probate. The BEST method is:

Placing the property in a revocable living trust

Writing an informal letter to the heirs

Recording a quitclaim deed without consideration

Filing a homestead declaration

#299. Under California law, the transfer of a parent’s primary residence to a child:

Is always subject to full reassessment

May be excluded from reassessment under Proposition 19 if the child uses it as a primary residence and within specified value limits

Requires a new appraisal by the county assessor

Is prohibited without court approval

#300. A buyer at closing receives a credit of $850 for rent proration. This means:

The buyer is paying the seller’s mortgage

The escrow company is refunding fees

The seller collected rent for a period extending beyond the closing date and must credit the buyer for the post-closing portion

The title company is reducing its charges

#301. Under California law, what happens when a property owner fails to pay property taxes for 5 consecutive years?

The property taxes are forgiven

The property is automatically transferred to the state

The county seizes the property without any sale process

The property may be sold at a tax sale by the county to recover the delinquent taxes

#302. A title insurance company discovers a forged deed in the chain of title. The effect is:

The forged deed is valid because it was recorded

Title insurance does not cover forgeries

The forgery renders the deed void, and the title insurance policy would cover the loss for the insured party

The forger automatically gains title to the property

#303. Under California law, a property tax proration using the actual days method requires:

Dividing the annual tax by 360 and multiplying by 30 days per month

Dividing the annual tax by 365 (or 366 for leap years) and multiplying by the number of days each party owned the property

Splitting the annual tax 50/50 between buyer and seller

Using the assessed value as the daily rate

#304. A buyer receives both an owner’s title insurance policy and the lender requires a lender’s policy. Which statement is CORRECT?

Both policies protect the buyer equally

The owner’s policy protects the buyer; the lender’s policy protects the lender. They provide separate coverages.

The lender’s policy replaces the owner’s policy

Only one policy is needed for both parties

#305. Under California law, a deed executed by a grantor who has been declared mentally incompetent by a court is:

Voidable at the grantor’s option

Void from the beginning because the grantor lacks legal capacity

Valid because the deed was signed

Enforceable if the grantee paid fair value

#306. A property is sold for $600,000 in a county with a documentary transfer tax rate of $1.10 per $1,000. The transfer tax is:

$660

$600

$6,600

$60

#307. Under California law, a recorded easement that benefits one property (dominant tenement) at the expense of another (servient tenement) is known as:

An easement in gross

An appurtenant easement

A prescriptive easement

A license

#308. A title search reveals that the property has a federal tax lien recorded against it. Before closing:

Federal tax liens are automatically released at closing

The federal tax lien must be satisfied or the parties must agree on how to address it to deliver clear title

The buyer must assume the federal tax lien

The lien has no effect on the title transfer

#309. Under California law, which of the following statements about the Closing Disclosure is TRUE?

It must be provided at least 30 days before closing

It must be provided to the buyer at least 3 business days before consummation of a mortgage loan

It is only required for cash purchases

It replaces the title insurance policy

#310. A property owner dies and leaves a will directing that the home go to their nephew. The executor:

Can immediately transfer the property without court involvement

Must sell the property at market value

Must go through probate to validate the will and transfer the property according to its terms

Can only transfer the property if all heirs agree

#311. Under California law, what is the purpose of the preliminary title report?

To inform the buyer of the current condition of the title, including any liens, encumbrances, and easements before closing

To set the property’s market value

To verify the property’s zoning classification

To calculate the property taxes

#312. A seller agrees to carry back a $200,000 second trust deed at 5% for 10 years. The trust deed is recorded. Recording:

Establishes the lender’s (seller’s) priority and provides constructive notice of the lien

Is optional for seller financing

Only benefits the buyer

Creates actual notice but not constructive notice

#313. Under California law, when multiple liens exist against a property, priority is generally determined by:

The size of the lien (largest has priority)

The identity of the lienholder

The order of recording, with the first recorded lien having the highest priority (except for property tax liens, which have super-priority)

The date the debt was incurred

#314. A property in California is sold for $750,000 with a transfer tax rate of $1.10 per $1,000 plus a local transfer tax of $3.30 per $1,000. The total transfer tax is:

$825

$2,475

$3,300

$7,500

#315. Under California law, a deed of trust contains a power of sale clause that allows:

The borrower to sell the property without the lender’s consent

The lender to take immediate possession upon default

The trustee to sell the property through non-judicial foreclosure if the borrower defaults

The government to seize the property for unpaid taxes

#316. A buyer discovers after closing that the seller did not have legal authority to convey the property (the seller was an imposter). The buyer’s title insurance:

Would not cover this type of loss

Would only cover half the purchase price

Would cover the loss because the deed was void due to fraud/forgery

Would require the buyer to sue the imposter first

#317. Under California law, the transfer of property from one spouse to the other during a marriage is:

Generally exempt from reassessment under Proposition 13 and from documentary transfer taxes

Subject to full reassessment

Taxed at a reduced rate

Prohibited without court approval

#318. A grant deed that fails to include a legal description of the property is:

Valid as long as the address is included

Generally invalid because a legal description is required to identify the property being conveyed

Valid if the parties know which property is intended

Valid if the deed is notarized

#319. Under California law, a prescriptive easement is acquired through:

Continuous, open, notorious, hostile, and exclusive use of another’s property for 5 years without the owner’s permission

Written agreement between property owners

Court order only

Payment of compensation to the property owner

#320. A title company issues a title insurance policy with an exception for a recorded utility easement. This means:

The title company will fix the easement issue

The title insurance policy will NOT cover losses related to the utility easement

The easement will be removed at closing

The buyer is guaranteed the easement will not affect property use

#321. Under California law, a property owner who wants to add their adult child to the deed should be aware that:

Adding a child to the deed is always free of tax consequences

Adding a child requires probate court approval

Adding a child to the deed may trigger partial reassessment and could have gift tax implications

A child can only be added through a will

#322. The purpose of a reconveyance deed in California is to:

Transfer property from seller to buyer in a standard sale

Foreclose on a defaulting borrower

Create a new lien against the property

Transfer the property from the trustee back to the borrower when the loan secured by the trust deed is paid in full

#323. Under California law, a property transferred as a gift is:

Subject to potential gift tax implications for the donor but generally not subject to income tax for the recipient

Always subject to income tax for the recipient

Exempt from all taxes

Subject to transfer taxes at double the normal rate

#324. A property is foreclosed through non-judicial foreclosure in California. The former owner:

Has a 1-year right of redemption

May redeem the property at any time within 90 days

Generally has NO right of redemption after a non-judicial trustee’s sale

Must petition the court for redemption rights

#325. Under California law, which of the following is TRUE about special assessments?

Special assessments are voluntary contributions

Special assessments only apply to commercial properties

Special assessments are charges for specific improvements (sidewalks, sewers) that benefit the property and create a lien if unpaid

Special assessments are included in the standard property tax rate

#326. A buyer purchases a property and immediately records the deed. The recording:

Guarantees the title is clear of all defects

Transfers legal title from the seller to the buyer (delivery does this)

Provides constructive notice to the world that the buyer is now the owner and establishes the buyer’s priority

Is optional and has no legal effect

#327. Under California law, an unrecorded deed between a grantor and grantee is:

Void and unenforceable

Only valid for 30 days

Valid and enforceable between the parties but does not provide constructive notice to third parties

Invalid because recording is required for the deed to take effect

#328. A property owner who dies intestate (without a will) and has no surviving relatives:

Has their property automatically go to the county

Has their property escheat to the state of California under intestate succession law

Has their property distributed by the DRE

Has their property remain vacant indefinitely

#329. Under California law, a mortgage differs from a trust deed primarily in that:

A mortgage is always better for the borrower

A trust deed provides more protection for the borrower

There is no practical difference

A mortgage involves only two parties (borrower and lender) and typically requires judicial foreclosure, while a trust deed involves three parties and allows non-judicial foreclosure

#330. A property sold for $500,000 has annual property taxes of $6,000. If closing occurs on September 1 and the buyer owns for 122 days (Sept 1 – Dec 31), the buyer’s prorated share is approximately:

$3,000

$3,995

$2,005

$6,000

#331. Under California law, the concept of ‘relation back’ in title insurance means:

The policy covers defects that occur after the policy date

The policy protects against defects that existed before the policy was issued, even if discovered later

The policy automatically extends to future owners

The policy relates back to the original construction date

#332. A title insurance company issues a commitment for title insurance. This commitment:

Sets forth the conditions under which the company will issue the title policy and lists any exceptions or requirements

Is the same as the final title insurance policy

Guarantees the title is clear

Is not binding on the title company

#333. Under California law, which of the following is NOT a requirement for adverse possession?

Occupation must be open and notorious

The adverse possessor must have the property owner’s written permission

Occupation must be continuous for 5 years

The adverse possessor must pay property taxes

#334. A property is transferred from a parent to a child through a grant deed. Under Proposition 19:

All parent-to-child transfers are excluded from reassessment regardless of use

The transfer of the parent’s primary residence may be excluded from reassessment if the child uses it as their primary residence and within value limits

The transfer is always fully reassessed

Parent-to-child transfers are prohibited

#335. Under California law, escrow funds may be released to the appropriate parties only when:

The buyer’s agent requests release

All conditions specified in the escrow instructions have been satisfied and both parties have consented

30 days have passed since opening escrow

The title company approves the release

#336. A property owner executes two deeds for the same property to different buyers. The first deed is delivered but not recorded; the second deed is delivered and recorded immediately. Under California’s race-notice recording statute:

The second buyer generally prevails because they recorded first and may have been a bona fide purchaser without notice of the first sale

The first buyer always prevails because they received the deed first

Both buyers share the property

The property reverts to the original owner

#337. Under California law, which of the following events does NOT require recording to be valid between the parties?

A lease for less than one year

A grant deed

A trust deed

A mechanics lien

#338. A property owner defaults on their property tax obligation. Under California law, delinquent property taxes:

Have no priority and are subordinate to all other liens

Become a lien on the property that has priority over virtually all other liens, including mortgages

Become a lien only after 3 years of delinquency

Are the responsibility of the previous owner only

#339. Under California law, the settlement process includes the preparation of:

Only the deed

A detailed accounting of all debits and credits for both buyer and seller, including prorated items and closing costs

Only the title report

Only the commission statement

#340. A property is conveyed to a buyer who discovers that the grantor’s name was misspelled on the deed. To correct this:

The original deed must be destroyed and reissued

The county recorder automatically corrects clerical errors

A corrective (correction) deed should be prepared and recorded to fix the error

The buyer must file a quiet title action

#341. Under California law, a tax lien sale differs from a trustee’s sale in that:

A trustee’s sale has priority over tax liens

Both sales are identical in procedure

Tax lien sales only occur in judicial proceedings

A tax lien sale results from unpaid property taxes and gives the government priority over all other liens, while a trustee’s sale results from mortgage default

#342. A property’s title report shows the property is subject to CC&Rs (Covenants, Conditions, and Restrictions). These:

Are recorded restrictions that limit how the property can be used and are binding on all future owners

Can be ignored by the buyer after purchase

Expire after 10 years

Only apply to the original developer

#343. Under California law, when prorating rent at closing for a rental property sold on March 15 with monthly rent of $3,000:

The seller credits the buyer approximately $1,548 for the 16 days remaining in March (16/31 x $3,000)

The seller keeps the full month’s rent

The buyer receives no credit for rent

The escrow company collects rent for the entire month

#344. A homeowner in California files a Declaration of Homestead. This provides protection against:

All foreclosure actions including mortgage default

Forced sale of the home to satisfy certain unsecured debts, up to the statutory homestead exemption amount

Property tax liens

Eminent domain proceedings

#345. Under California law, constructive delivery of a deed occurs when:

The deed is handed directly to the grantee

The deed is mailed to the grantee

The deed is signed by the grantor

The grantor’s actions demonstrate an intent to transfer ownership even though physical delivery to the grantee has not occurred, such as recording the deed

#346. A property in a probate sale receives an overbid at the confirmation hearing. Under California probate law:

Overbids are not permitted in probate sales

The original buyer has an absolute right to purchase at their original offer price

The executor decides whether to accept the overbid

The property may be sold to the highest bidder at the confirmation hearing, which may be someone other than the original buyer

#347. Under California law, the transfer of real property by operation of law includes all of the following EXCEPT:

Foreclosure

Eminent domain

Intestate succession

A voluntary sale between buyer and seller

#348. A title insurance company’s policy contains a schedule of exclusions. These exclusions:

Include all possible title defects

List specific items the policy does NOT cover, such as known defects, governmental regulations, and defects created by the insured

Only apply to commercial properties

Can be removed by paying an additional premium in all cases

#349. Under California law, recording fees are:

Charged by the county recorder for filing documents in the public records and vary by county

Set uniformly throughout California by the DRE

Always paid by the buyer

Included in the title insurance premium

#350. A property closing is delayed because the title company discovers a judgment lien that the seller was unaware of. The seller must:

Clear the judgment lien before closing can proceed, either by paying it off or negotiating with the judgment creditor

Ignore the lien because the seller was unaware of it

Transfer the lien obligation to the buyer automatically

File a complaint with the DRE against the judgment creditor

#351. Under California law, which type of deed is used by a trustee conducting a non-judicial foreclosure sale?

Grant deed

Warranty deed

Trustee’s Deed Upon Sale

Quitclaim deed

#352. A buyer closes on a property where annual taxes of $5,475 have been prepaid by the seller for the full calendar year. Closing is April 1 (seller owned 90 days). The buyer owes the seller a credit of approximately:

$1,350

$5,475

$2,737.50

$4,125 for the remaining 275 days

#353. Under California law, a standard coverage title insurance policy covers:

Survey errors and encroachments

Defects found in public records, forged documents, incompetent grantors, and incorrect marital statements

Unrecorded liens and off-record risks

Mining claims and water rights

#354. A property is sold subject to an existing mortgage. This means:

The buyer assumes personal liability for the existing mortgage

The mortgage is automatically paid off at closing

The buyer takes the property with the existing mortgage remaining in place, but the original borrower remains liable

A new mortgage replaces the existing one

#355. Under California law, recording a lis pendens:

Automatically prevents the sale of the property

Transfers title to the plaintiff

Eliminates all liens on the property

Provides constructive notice that a lawsuit affecting the property has been filed, warning potential buyers

#356. A property’s closing statement shows a debit to the seller of $2,400 for transfer taxes. At a rate of $1.10 per $1,000, the approximate sale price is:

$2,640,000

$240,000

$2,181,818

$2,400,000

#357. Under California law, an extended coverage (ALTA) title insurance policy differs from standard coverage by:

Only covering a longer time period

Including protection against unrecorded liens, encroachments, survey errors, and rights of parties in possession

Being available only for commercial properties

Providing lower premiums

#358. A buyer receives a grant deed with the following covenant: ‘Subject to all existing easements of record.’ This means:

The buyer can eliminate the easements after closing

The buyer takes the property subject to any easements that have been recorded in the public records

No easements exist on the property

The easements will expire within 5 years

#359. Under California law, a property transferred through a will is distributed according to:

Intestate succession

The county assessor’s determination

Testate succession, with the probate court overseeing the process

The DRE’s recommendation

#360. A buyer closes on a property where the seller has not paid the current year’s property taxes. The closing statement will show:

A debit to the buyer for all property taxes

No adjustment because taxes are paid at year-end

A credit to the buyer for the seller’s share of unpaid property taxes covering the seller’s period of ownership

A credit to the seller for prepaid taxes

#361. Under California law, a corrective deed is used when:

The property is being transferred to a new owner

A previously recorded deed contains an error such as a misspelled name or incorrect legal description that needs to be corrected

The original deed is lost

The property has been rezoned

#362. A buyer’s title insurance policy shows a Schedule B exception for ‘rights of tenants in possession.’ This means:

All tenant rights are automatically terminated at closing

The policy does not cover claims by current tenants or occupants of the property; the buyer should investigate tenant occupancy

The policy fully covers tenant-related issues

Tenants must vacate before the policy is issued

#363. Under California law, when property is held in joint tenancy and one owner dies:

The deceased’s interest goes through probate

The deceased’s interest passes to their heirs under their will

The property must be sold and proceeds divided

The deceased’s interest passes automatically to the surviving joint tenant(s) through right of survivorship, avoiding probate

#364. A property closes on October 15 with annual insurance paid through December 31 ($1,200/year). The seller is entitled to a credit from the buyer of approximately:

$1,200

$600

$947

$253 for the 77 remaining days of coverage (Oct 15 – Dec 31)

#365. Under California law, which of the following is TRUE about title insurance premiums?

Title insurance premiums are typically paid once at closing and provide coverage for as long as the insured owns the property

Title insurance premiums are paid annually like homeowners insurance

Title insurance premiums are regulated by the DRE at fixed rates

Title insurance premiums are always paid by the buyer

#366. A deed contains the words ‘grants, bargains, and sells.’ Under California law, this language:

Creates the same warranties as a warranty deed

Provides no warranties

Is only valid in quitclaim deeds

Creates implied warranties found in a grant deed under Civil Code §1092

#367. Under California law, a buyer who assumes an existing mortgage:

Has no personal liability for the loan

Must refinance the loan within 90 days

Takes personal liability for the loan and agrees to make payments under the existing loan terms

Automatically qualifies for a lower interest rate

#368. A closing statement shows the buyer’s total debits are $505,000 and total credits are $450,000. The buyer must bring to closing:

$505,000

$450,000

$955,000

$55,000

#369. Under California law, a notice of default is the first step in:

The non-judicial foreclosure process under a trust deed

The probate process

Recording a new deed

Filing an eminent domain action

#370. A title search reveals that a previous owner’s divorce decree awarded the property to one spouse, but no deed was recorded transferring the interest. This creates:

No issue because the divorce decree is sufficient

An automatic transfer that does not require recording

A cloud on the title that must be resolved before the property can be conveyed with clear title

A title defect that only affects the divorced couple

#371. Under California law, the closing agent must ensure that:

All conditions of the purchase agreement are satisfied before disbursing funds and recording the deed

Only the buyer’s conditions are satisfied

The property passes inspection

The appraised value matches the purchase price

#372. A property sold for $400,000 in a city that imposes a city transfer tax of $3.30 per $1,000 in addition to the county transfer tax of $1.10 per $1,000. The total transfer tax is:

$1,760

$440

$1,320

$4,400

#373. Under California law, the reinstatement period during non-judicial foreclosure allows the borrower to:

Renegotiate the loan interest rate

Cure the default by paying all past-due amounts plus costs and fees, reinstating the original loan terms

Sell the property at auction

Transfer the property to a family member

#374. A property’s title report lists a recorded CC&R that restricts the property to residential use only. The buyer plans to operate a home business. The buyer should:

Ignore the CC&Rs because they are outdated

Assume the CC&Rs are unenforceable

Review the CC&Rs carefully and consult legal counsel to determine if the home business would violate the restriction

Record a new deed without the restriction

#375. Under California law, which of the following statements about deeds is TRUE?

A signed deed automatically transfers title

A deed must be delivered and accepted to be effective; mere signing is not sufficient to transfer title

A deed must be recorded to be valid between the parties

A deed is effective when notarized

#376. A property is sold subject to a deed of trust. The seller’s closing statement shows a payoff of the existing loan. The payoff amount includes:

The remaining principal balance, accrued interest, and any prepayment penalties or fees

Only the original loan amount

Only the remaining principal balance

The original loan amount plus all interest paid to date

#377. Under California law, an escrow holder who discovers a discrepancy in the closing figures must:

Notify all parties and resolve the discrepancy before disbursing funds

Proceed with closing and adjust later

Report to the DRE immediately

Choose which party’s figures to use

#378. A property is being foreclosed through judicial foreclosure in California. The borrower has:

No right of redemption

A 30-day right of redemption only

An unlimited right of redemption

A right of redemption for up to one year after the judicial foreclosure sale (or 3 months if proceeds cover the debt)

#379. Under California law, a life estate:

Grants the holder the right to use and enjoy the property during their lifetime, with the property reverting to the remainderman upon death

Grants permanent ownership

Is the same as fee simple absolute

Can only be created by court order

#380. A title insurance claim is filed when a buyer discovers an undisclosed lien from a previous owner. The title insurance company will:

Automatically deny the claim

Require the buyer to cure the defect personally

Increase the buyer’s premium

Investigate the claim and either cure the defect, negotiate a settlement, or compensate the insured up to the policy limits

#381. Under California law, a property sold at a trustee’s sale (non-judicial foreclosure):

Includes a full warranty from the lender

Comes with a 1-year warranty from the trustee

Is sold on an ‘as-is’ basis with no warranties, and the buyer receives a trustee’s deed upon sale

Includes an inspection contingency for the buyer

#382. A seller provides a grant deed at closing. After recording, the buyer discovers that an easement not disclosed by the seller was created during the seller’s ownership. Under the grant deed warranties:

The seller is responsible because the grant deed warrants the property is free from encumbrances created by the grantor except those disclosed

The buyer has no recourse because the deed was recorded

The title company is responsible

The seller is responsible only if the easement reduces value by more than $10,000

#383. Under California law, the notice of trustee’s sale must be:

Only mailed to the borrower

Only recorded with the county

Published in a legal journal 90 days before the sale

Published, posted on the property, and recorded at least 20 days before the sale

#384. A closing statement for a buyer shows the following credits: purchase price deposit $25,000, loan proceeds $375,000. The buyer’s total credits are:

$375,000

$25,000

$350,000

$400,000

#385. Under California law, which of the following is TRUE about a sheriff’s deed?

It provides the same warranties as a grant deed

It is only used for commercial properties

It is issued by the county assessor

It is issued after a judicial foreclosure sale and conveys whatever interest the foreclosed owner had in the property

#386. A property’s assessed value under Proposition 13 is $250,000. The maximum assessed value for the following year (without a change in ownership or new construction) is:

$275,000 (10% maximum increase)

$262,500 (5% maximum increase)

$250,000 (no increase allowed)

$255,000 (2% maximum increase)

#387. Under California law, a transfer on death (TOD) deed allows:

An immediate transfer of property to the beneficiary

The property to be sold at auction upon the owner’s death

A property owner to designate a beneficiary who will receive the property upon the owner’s death without probate

The property to transfer to the state upon the owner’s death

#388. A buyer’s closing statement shows debits for: purchase price $500,000, closing costs $8,000, and prorated taxes $1,200. Total debits are:

$500,000

$508,000

$509,200

$501,200

#389. Under California law, the period after a notice of default during which the borrower may reinstate the loan by curing the default is:

Generally 3 months (approximately 90 days) from the recording of the notice of default

30 days

6 months

1 year

#390. A property sold for $300,000 has annual property taxes of $3,600. Closing is March 31 (seller owned 90 days out of 365). The seller’s prorated share is:

$1,800

$2,712.33

$887.67

$3,600

#391. Under California law, a trust deed’s due-on-sale clause:

Requires the borrower to sell the property

Prevents the borrower from ever selling the property

Only applies to commercial loans

Allows the lender to accelerate the loan and demand full payment if the borrower transfers the property without the lender’s consent

#392. A buyer purchases title insurance that covers $450,000 (the purchase price). Ten years later, the property is worth $700,000 and a title defect is discovered. The buyer’s coverage is:

Automatically adjusted to $700,000

Always equal to the current market value

$0 because the policy expired after 10 years

Limited to the original policy amount of $450,000 unless an inflation rider was purchased

#393. Under California law, which of the following is TRUE about the order of lien priority?

The largest lien always has the highest priority

Property tax liens have super-priority and take precedence over all other liens regardless of recording date

All liens have equal priority

Private liens always have priority over government liens

#394. A property is sold and the deed is recorded. Three days later, a previously unknown heir of a former owner claims an interest in the property. The buyer’s title insurance:

Would not cover this type of claim

Would only cover if the claim exceeds $50,000

Would require the buyer to litigate before providing coverage

Should cover this claim because it is a defect in the chain of title existing before the policy date

#395. Under California law, a grant deed that is properly executed and delivered but never recorded:

Is completely void

Is valid for only 90 days

Must be notarized to be valid between the parties

Is valid between the grantor and grantee but may not protect the grantee against claims from subsequent good-faith purchasers who record first

#396. A property is sold subject to existing CC&Rs that restrict the height of structures to one story. The buyer who builds a two-story addition may face:

Legal action from the HOA or neighbors to enforce the CC&R restriction, potentially requiring removal of the non-conforming construction

No consequences because CC&Rs expire after 10 years

Only a small fine from the city

Automatic approval if the city issues a building permit

#397. Under California law, a beneficiary statement from the lender provides:

A recommendation to buy the property

Information about the current balance, interest rate, and status of the existing loan secured by the property

An appraisal of the property’s value

The property’s title insurance policy

#398. A closing statement credit to the seller for prepaid property taxes means:

The seller is receiving a tax refund from the county

The buyer is paying the seller’s future taxes

The government is subsidizing the seller

The seller has already paid taxes for a period extending beyond the closing date, and the buyer is reimbursing the seller for the post-closing portion

#399. Under California law, which of the following is TRUE about a subordination agreement?

It automatically eliminates the earlier lien

It changes the priority of liens, allowing a later-recorded lien to take priority over an earlier one with the consent of the earlier lienholder

It is only used in commercial transactions

It requires court approval

#400. A buyer purchases a property with a title insurance policy that contains an exclusion for ‘matters which would be revealed by a survey.’ If a survey later reveals an encroachment:

The title insurance policy would NOT cover the encroachment because it was specifically excluded

The title insurance company must pay regardless of the exclusion

The buyer can sue the title company for the exclusion

The exclusion is automatically void

Chapter 10 (Transfer of Title)

Results

#1. Which deed is most commonly used in California residential real estate transactions?

#2. A quitclaim deed differs from a grant deed in that a quitclaim deed:

#3. Under California Civil Code §1092, a grant deed contains which of the following implied warranties?

#4. For a deed to be valid in California, which of the following is required?

#5. Recording a deed with the county recorder’s office establishes:

#6. John purchases a property and receives a grant deed but delays recording for 2 weeks. During that time, the seller fraudulently conveys the same property to Mary, who records immediately. Under California recording law:

#7. A warranty deed provides which level of protection to the grantee?

#8. A trust deed in California involves three parties. They are:

#9. Which of the following is TRUE about title insurance in California?

#10. The difference between a marketable title and an insurable title is:

#11. Under California law, which of the following transfer methods occurs WITHOUT the owner’s consent?

#12. Adverse possession in California requires all of the following EXCEPT:

#13. Under the California Probate Code, if a person dies without a valid will:

#14. Non-judicial foreclosure in California is typically completed within:

#15. The probate process in California serves to:

#16. Eminent domain requires the government to provide:

#17. An escrow agent in California acts as:

#18. Under California Financial Code §17000, escrow holders are required to:

#19. A proration of property taxes ensures that:

#20. If annual property taxes are $3,650 and closing is July 1, with the seller owning from January 1 to June 30 (181 days), the seller’s share of property tax is approximately:

#21. California transfer taxes are imposed on the conveyance of property at rates typically ranging from:

#22. Which of the following correctly describes the chain of title?

#23. Under California law, a buyer who receives a grant deed is protected against:

#24. A seller offers a quitclaim deed in a standard residential sale. A buyer’s agent should advise the buyer to:

#25. The recording process in California is governed by:

#26. Under California law, which of the following statements about constructive notice is TRUE?

#27. A quiet title action is used to:

#28. Under California probate law, a simplified probate procedure is available for estates valued at less than:

#29. Which of the following is TRUE about an owner’s title insurance policy?

#30. A lender’s title insurance policy:

#31. Under California law, which of the following is NOT a method of voluntary property transfer?

#32. A title search reveals a gap in the chain of title. This indicates:

#33. Under California Revenue and Taxation Code §11900, transfer taxes are typically paid by:

#34. A property is being sold and the seller has not yet paid the annual property taxes of $4,380. Closing is August 15. Using 365 days, the seller’s share (Jan 1-Aug 14, 226 days) is approximately:

#35. Under California law, notarization of a deed is:

#36. Which of the following is TRUE about the relationship between title insurance and warranty deeds in California?

#37. Under California law, the executor of a will is responsible for:

#38. A cloud on title can be caused by all of the following EXCEPT:

#39. Under California law, which of the following is TRUE about the probate sale of real property?

#40. Constructive notice differs from actual notice in that:

#41. A deed in lieu of foreclosure occurs when:

#42. Under California law, which of the following is required for a valid will?

#43. A property owner dies with a valid will leaving the home to a specific beneficiary. The transfer occurs through:

#44. Under California law, a trust deed allows for which type of foreclosure?

#45. The settlement statement (closing statement) in a real estate transaction:

#46. Under California law, the buyer’s share of prorated property taxes at closing:

#47. A title company discovers that a previous deed in the chain of title was signed by a minor. This is:

#48. Under California law, an abstract of title:

#49. Which of the following statements about recording priority is CORRECT?

#50. Under California law, a property transferred through a gift requires:

#51. A homestead declaration in California:

#52. Under California law, which of the following is TRUE about the transfer tax exemption?

#53. A title search reveals an unrecorded easement that allows a utility company to access the property. Under California law:

#54. Under California law, rent proration at closing ensures that:

#55. A trust used to hold real property in California:

#56. Under California law, the Closing Disclosure (required by TRID for mortgaged properties) must be provided to the buyer:

#57. A property owner executes a grant deed but never delivers it to the grantee. Under California law:

#58. Under California law, which of the following correctly describes the doctrine of constructive notice?

#59. A buyer at closing discovers that the seller’s grant deed contains an error in the legal description. The buyer should:

#60. Under California law, a lis pendens is:

#61. Which of the following statements about title insurance coverage is CORRECT?

#62. Under California law, a deed executed by a person under duress is:

#63. A property in California is sold at a tax sale because the owner failed to pay property taxes. The new buyer at the tax sale receives:

#64. Under California law, the buyer and seller each receive a copy of the settlement statement:

#65. A property owner places property in a living trust. Under California law:

#66. Under California law, the documentary transfer tax is calculated based on:

#67. A buyer purchases a property at a judicial foreclosure sale. Under California law:

#68. Under California law, which of the following is TRUE about joint tenancy and the right of survivorship?

#69. A grantor signs a deed and places it in a safe deposit box with instructions to deliver it to the grantee after the grantor’s death. Under California law:

#70. Under California law, homestead protection amounts vary based on:

#71. A mechanic’s lien in California:

#72. Under California law, a property is transferred through intestate succession when:

#73. A title insurance policy’s coverage amount typically:

#74. Under California law, an escrow agent may NOT:

#75. Which of the following statements about deed delivery in California is CORRECT?

#76. Under California law, a property sold through eminent domain must be appraised:

#77. A buyer purchases property and discovers after closing that an undisclosed easement exists. The buyer’s recourse depends on:

#78. Under California law, the statutory period for adverse possession is: