National Real Estate Exam (PSI)Transfer of TitleMedium
A title examiner is preparing a chronological, written summary of every recorded document affecting a parcel's ownership history, going back to the original government patent, to identify gaps or defects in ownership. What is this document called?
- AAbstract of title
- BTitle insurance policy
- CTitle commitment
- DCertificate of title
Show answer & explanationAnswer & explanation
Correct answer: A. Abstract of title
An abstract of title is a condensed, chronological history of all recorded transactions and legal actions affecting a property, used to trace the chain of title and reveal any defects or clouds. It is a research document, not a guarantee or insurance product.
Why the other options are wrong
- B. A title insurance policy insures against future losses from title defects; it is not a historical summary.
- C. A title commitment is a preliminary promise to issue insurance subject to certain conditions, issued after examination.
- D. A certificate of title is an opinion stating who currently holds title, based on the abstract, not the history itself.
Abstract of Title
A chronological summary of all recorded documents and legal proceedings affecting ownership of a specific parcel of land.
- Traces chain of title back to original grant
- Used to identify clouds or gaps in ownership
- Basis for a certificate of title or title insurance decision
Memory trick: 'Abstract = A History Book of the property's past owners.'