Q: What is real estate?
A: Real estate (also called real property) refers to land and things attached to land. For most consumers, real estate consists of their home and the lot surrounding it. Commercial real estate may include office buildings, equipment and other facilities. In addition to buildings and equipment, resources existing on or under the land, including minerals and gas, are part of real estate. Some of these components of real estate can be sold separately.
Q: What is a deed?
A: Deeds indicate, and are generally required to transfer, ownership of real estate. A deed contains the names of the old and new owners and a legal description of the property and is signed by the person transferring the property. The different kinds of deeds, such as the general warranty deed, special warranty deed, quit-claim deed and easement deed, transfer different interests in property.
Q: What is a disclosure statement?
A: A disclosure statement is a form some states require a property seller to complete and provide to the buyer, disclosing certain defects and other information about the property. The disclosure requirements vary by state.
Q: What are some typical restrictions imposed on property owners?
A: Real estate owners can’t do whatever they want on their property. Federal laws provide environmental restrictions, while local ordinances control everything from noise levels to fence height. Local law is also the usual source of zoning rules, which limit the uses of property in certain areas. State laws typically regulate who can access property and how boundaries are established and changed. Private agreements and other restrictions may also control property use. For example, a development may contain restrictive covenants regarding lot size, architectural design, vehicle parking and other details.
Q: What is joint tenancy?
A: Joint tenancy is an arrangement in which more than one person owns a piece of property. Many spouses own their property as joint tenants, with equal shares in the property. Joint tenancy can include a right of survivorship, which allows the property to transfer to the other tenant(s) when one joint tenant dies.
Q: What happens to a deed after it is signed and notarized?
A: A signed deed should be recorded, or filed, in the appropriate land records office, usually in the county in which the property is located. The office is typically called the County Recorder’s Office, the Land Registry Office, the Registrar or Register of Deeds. To record the deed, the signed, original deed is taken to the land records office where, for a small fee, it is date-stamped and officially record. Recording the deed notifies the public of the change in ownership and the interests in the property.
Q: How do mortgages work?
A: When a bank or other financial institution provides a loan for the purchase of real estate, a mortgage interest, or deed of trust, is created, which means the bank’s loan is secured by an interest in the property. State laws interpret mortgages differently, resulting in different consequences if the borrower fails to make a payment.
Q: What happens in a mortgage foreclosure?
A: If a homeowner fails to make mortgage payments, the lender may foreclose on the property. Depending on state law and the terms of the mortgage, or deed of trust, the lender may do a statutory foreclosure without going to court or a judicial foreclosure in court. State laws provide strict regulations regarding proper notices and opportunities to pay before the property is sold in a foreclosure sale. If your property is at risk of foreclosure, you should consult an attorney as soon as possible.
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