Insurance MCQ

What privacy notice is required by the Maryland Insurance Administration? A. Notice of the rescission regarding the transaction B. The notice regarding errors and omissions concerning the transaction C. A notice reflecting agency policy regarding non-public financial info/privacy D. A notice regarding the condition of the property at the time of transaction Answer: C. A notice reflecting agency policy regarding non-public financial info/privacy

Which of the following endorsements is issued for a planned unit development? A. Party wall endorsement B. Planned community endorsement C. Planned neighborhood endorsement D. Planned unit development endorsement Answer: D. Planned unit development endorsement

Maryland title insurance policy does not insure against loss resulting from: A. Title defect B. Lack of a right of access to and from the land C. Unmarketability of the title D. Exercise of police powers Answer: D. Exercise of police powers

The Maryland Insurance Commissioner is not responsible for: A. Approving insurance rates B. Approving policy forms C. Administering insurance laws D. Endorsing insurers Answer: D. Endorsing insurers

Title insurance premiums are paid how often? A. Weekly B. Monthly C. Annual D. Single Answer: D. Single

Which of the policies protects a lender from damages resulting from a title defect? A. Mortgage guaranty B. Loan C. Leasehold owner's D. Owner's Answer: B. Loan

This relationship best describes the relationship between title insurance producer (TIP) and a title insurance producer independent contractor (TIPIC)? A. Joint venture B. Controlled business association C. Employer and employee D. Principal and agent Answer: D. Principal and agent

Non-MD residents who sell property in MD are charged a percentage based on what? A. Mortgage payoffs B. Total payment C. 50% of purchase price D. 25% of purchase price Answer: B. Total payment

The consumer is informed of the right to purchase an owner's title insurance policy and its cost on what type of document? A. Privacy notice B. Statutory notice to buyer C. Owner/Seller affidavit D. HUD-1 Settlement Statement Answer: B. Statutory notice to buyer

This figure is frequently pro-rated on the HUD-1 Settlement Statement/Closing Disclosure: A. Recording taxes B. Real estate tax C. Mortgage pay offs D. Sewer and water bill Answer: B. Real estate tax

Title insurance premiums must be approved by: A. Governor B. Maryland Insurance Administration C. Maryland Land Title Association D. Real Estate Commissioner Answer: B. Maryland Insurance Administration

The following may be the grounds for suspending a title insurance producer license: A. Felony B. Speeding ticket C. Not meeting minimum production goals D. Not passing the title producer pre-licensing course Answer: A. Felony

The MD Insurance Commissioner does NOT have the authority to examine what? A. Final records of policyholders B. Financial condition of insurers C. Proceeds raised for the purpose of organizing an insurer D. Accounts of insurance producer, surplus, lines, brokers or adjusters Answer: C. Proceeds raised for the purpose of organizing an insurer

Title insurance premiums are filed with the Maryland Insurance Administration and remain in effect for how long? A. 5 years B. 7 years C. 12 years D. Until reviewed and approved Answer: D. Until reviewed and approved

A title insurance producer who receives an inquiry from the Maryland Insurance Administration MUST reply as directed by the: A. Underwriter B. Insurer C. Commissioner D. Maryland Insurance Administration Answer: C. Commissioner

The insured closing protection letter is issued by the title insurance underwriter and is always requested by this party? A. Seller B. Buyer C. Title Producer D. Lender Answer: D. Lender

A deed that contains warranties that are not limited or restricted in its scope to the current seller is said to be this type of deed: A. Trustee's deed B. Quit Claim deed C. Special Warranty deed D. General Warranty deed Answer: D. General Warranty deed

A licensed title insurer may issue? A. Title insurance only B. Title and property insurance C. Title, property and casualty insurance D. Life insurance Answer: A. Title insurance only

A tenancy by the entirety is severed by which of the following acts? A. Federal tax lien against one spouse B. Entry of judgment against one spouse C. Bankruptcy of one spouse D. An absolute divorce of the spouses Answer: D. An absolute divorce of the spouses

The proper jurisdiction to record a deed is: A. County where grantor resides B. Municipality where grantor resides C. Jurisdiction where land is located D. Jurisdiction where the deed is signed Answer: C. Jurisdiction where land is located

A licensed title producer is authorized to sell and/or solicit title insurance on behalf of: A. The Maryland Insurance Commissioner B. The appointing title insurer C. All title insurers D. The State of Maryland Answer: C. All title insurers

The tenancy most often selected by married couples taking title of real property is? A. Joint tenants B. Tenants in common C. Tenants by the entirety D. Tenant in severalty Answer: C. Tenants by the entirety

In Maryland, the document creating a residential ground rent is called: A. Deed B. Lease C. Mortgage D. Land installment contract Answer: B. Lease

The clerk of the circuit court for each Maryland County is required to use which of the following land record archives. A. Real Property Track Index B. Tax Identification Index C. Attorney Registration Index D. Alphabetic Grantor Grantee Index Answer: D. Alphabetic Grantor Grantee Index

Which of the following usually requires a written statement of borrower to close the account? A. Purchase money mortgages B. Home Equity line of credit C. Financing statement D. Indemnity Deed of Trust Answer: B. Home Equity line of credit

Who may exercise control over escrow funds maintained in a title agency escrow account? A. Licensed real estate agent B. Licensed loan officer C. Licensed attorney D. Licensed title producer Answer: D. Licensed title producer

Which of the following deeds contain the least title assurance? A. Warranty deed B. Covenant deed C. Indemnity deed D. Quit Claim deed Answer: D. Quit Claim deed

Which of the following types of ownership creates a right of survivorship? A. Tenancy in common B. Leasehold C. Option D. Joint tenancy Answer: D.. Joint tenancy

Secondary mortgage may not be signed at A. The office of the lender's attorney B. The lender's office C. The title company D. The borrower's home Answer: D. The borrower's home

Which is not an acceptable method of describing land in the deed by? A. Reference to a recorded plat B. Metes and bounds description C. Recorded survey D. Reference to an unrecorded plat Answer: D. Reference to an unrecorded plat

What is meant by Lots 1 to 6 inclusive? A. Lots 1,2,3,4 and 5 B. Lots 1,2,3,4,5 and 6 C. Lots 2,3,4 and 6 D. Lots 1 and 6 Answer: B. Lots 1,2,3,4,5 and 6

Unless extended, the lien of an ordinary money judgment extended in favor of an individual in Maryland expires after how many years? A. 5 B. 10 C. 12 D. 20 Answer: C. 12

The following is NOT a requirement of a deed of conveyance: A. Witness B. Legal action C. Acknowledgement D. Name of the parties Answer: A.Witness

Each straight line in a metes and bounds description consists of: A. A lot and block B. A radius and traverse C. A bearing and distance D. An arc and chord Answer: C. A bearing and distance

Which of the following NEVER provides a warranty of title to the grantee? A. Special warranty deed B. General warranty deed C. Quit claim deed D. Ground Rent redemption deed Answer: C. Quit claim deed

When a person reserves the right of the use and enjoyment of real property only until death; this interest is known as: A. Joint tenancy B. Tenancy in common C. Life estate D. lease Answer: C. Life estate

The period required to possess real property to the title by adverse possession is? A. 20 years B. 10 years C. 7 years D. 12 years Answer: A. 20 years

Standard title insurance owner's coverage lasts for how long? A. 5, 10 or 15 years, depending on the type of coverage purchased B. As long as the property is owned by named insured and heirs C. Throughout the life of the mortgage D. For one year, renewable every year Answer: B. As long as the property is owned by named insured and heirs

Obtaining and recording releases of mortgage and deeds of trust satisfied at closing is considered what part of the settlement process? A. Pre-closing B. Closing C. Post-Closing D. Marketing Answer: C. Post-Closing

Real property of a decedent vests in the? A. Personal Representative B. Court Appointed Trustee C. Heirs by law D. Claimants to the will Answer: A. Personal Representative

The primary function of a title insurance underwriter is to: A. Analyze insurance risk B. Evaluate the fairness of the transaction C. Negotiate the terms of the transaction D. Supervise escrow disbursements Answer: A. Analyze insurance risk

A deed of trust may be released by any of the following except the: A. Certificate of satisfaction signed by the beneficiary B. Estoppel declaration signed by borrower C. Release signed by the trustee D. Cancelled check with attorney affidavit Answer: B. Estoppel declaration signed by borrower

When a homeowner refinances the loan secured by his home, an affidavit attached to the new Deed of Trust must include the following: A. Name and address of the lender who was paid off B. Final due date of the new loan C. Principal balance of the loan being paid off D. Current tax assessment Answer: C. Principal balance of the loan being paid off

A deed of trust can be released by the following except: A. A loan form released signed by trustee B. Recording note marked paid and controlled by the holder C. Certificate of satisfaction signed by the post settlement processor D. Certificate of satisfaction signed by the note holder or mortgagor Answer: C. Certificate of satisfaction signed by the post settlement processor

Which is a chronological history of all conveyances and encumbrances affecting a specific parcel of land? A. Chain of title B. Title enforcement C. ALTA addendum D. Title Insurance binder Answer: A. Chain of title

A federal tax lien is expired after how many years? A. 5 B. 10 C. 12 D. 20 Answer: B. 10

Unless otherwise specifically provided the statute of a money judgment entered in favor of the State of Maryland or one of the instrumentalities can be enforced for how many years? A. 7 years B. 12 years C. 20 years D. Forever Answer: D. Forever

Which of the following forms modify the terms of a title insurance policy? A. Exhibit B. Codicil C. Endorsement D. Addendum Answer: C. Endorsement

What is the meaning of Metes and Bounds? A. Insuring provisions B. Legal description by lot and block C. Legal square footage of a house D. Legal description of parcel by course and distance Answer: D. Legal description of parcel by course and distance

The personal representative deed for the transfer of the title to real property typically contain? A. No warranties of title B. General warranties of title C. Special warranties of title D. A covenant of quiet enjoyment Answer: A. No warranties of title

The primary purpose of requiring identification of a buyer and seller at settlement is to: A. Comply with RESPA requirements B. Check marital status C. Verify the spelling of the name D. Prevent fraud Answer: D. Prevent fraud

The statutory period in Maryland to establish title to real property by adverse possession is: A. 10 years B. 12 years C. 15 years D. 20 years Answer: D. 20 years

Who many handle escrow funds maintained in the title agency escrow account? A. Attorney B. Loan Officer C. Licensed real estate agent D. Title Producer Answer: D. Title Producer

Which of the following is not considered when determining the redemption price of a redeemable ground rent? A. Date the lease was created B. A sum specified in the lease C. A sum agreed to by the parties of the time of redemption D. County where the property is located Answer: D. County where the property is located

The title insurance policy covers which of the following? A. Defects resulting from unreleased prior liens not excepted to on Schedule B B. Defects caused by the insured after policy insurance C. Defects known to the insured when policy was issued but not disclosed to the title insurance company D. Defects which caused the insured no loss or damage Answer: A. Defects resulting from unreleased prior liens not excepted to on Schedule B

A location drawing is NOT to be used to: A. Locate improvements within a lot B. Locate building setback lines C. Locate property BOUNDARY lines D. Show driveways and roads Answer: C. Locate property BOUNDARY lines

A deed conveying real property by a debtor in Chapter 13 bankruptcy must be signed by: A. Creditors of the debtor(s) after court approval B. United States Bankruptcy judge C. Chapter 13 trustee after approval by bankruptcy court D. Record owner(s) as debtor in possession after approval by bankruptcy court Answer: C. Chapter 13 trustee after approval by bankruptcy court

When the record owner of land deeds it to a revocable trust, a title is vested in whom? A. The owner who created the trust B. Personal representative of the owner C. The trustee(s) of the trust D. All beneficiaries of the trust Answer: C. The trustee(s) of the trust

The requirements to obtain a release and satisfaction of an unreleased Deed of Trust is reflected in which of the following Schedule of a Title Insurance Commitment? A. Schedule A B. Schedule B-I C. Schedule B-II D. Schedule C Answer: B. Schedule B-I

Title companies, which are not law firms, may prepare deeds and deeds of trust under the supervision of an attorney only if required by: A. Customer B. Title commitment C. Realtor D. Lender Answer: B. Title commitment

A lender is permitted to fund money loan proceeds by: A. Assignment of funds B. Promissory note C. Cashier check D. Letter of debt Answer: C. Cashier check

Which of the following is generally not recorded in the Land Records office? A. Deed of conveyance B. Restriction conveyance C. Subdivision plat D. Statutory Notice of Title Insurance Answer: D. Statutory Notice of Title Insurance

A subordination agreement should be filed in what office? A. State Department of Assessments and Taxation B. Lien Certificate Department C. State's Attorney Office D. County Land Records Answer: D. County Land Records

How many years must have lapsed after the maturity date set forth in an unreleased mortgage or deed of trust before it is terminated and unenforceable by operation of law? A. 6 B. 10 C. 12 D. 40 Answer: D. 40

Individual sellers who reside out of state are required to have taxes withheld when selling property. The amount of tax withheld is based on 7.5% of the total payment. A. True B. False Answer: A. True

In a purchase transaction, a hud-1 settlement statement must be executed by A. Buyer, seller and title company representative B. Buyer and title company representative C. Lender and title company representative D. Buyer and lender Answer: A. Buyer, seller and title company representative

Foreclosure property may be transferred A. Immediatelyaftertheforeclosuresaletakesplace B. Once all creditors receive notice C. After the sale has been ratified by the Circuit Court D. One year after the foreclosure sale takes place Answer: C. After the sale has been ratified by the Circuit Court

What is the standard title search in Maryland? A. 20 years B. 30 years C. 50 years D. 60 years Answer: D. 60 years

Which of the following is necessary to create an enforceable restriction on the use of land? A. A personal agreement between the parties B. A recorded covenant which touches and concerns land C. An intention that the covenant run with the land D. Language binding the successors and assigns of the parties Answer: B. A recorded covenant which touches and concerns land

Which of the following title deeds pass no title to the buyer and are considered void? A. Quit claim deed B. Bargain and sale deed C. Forged deed D. Trustee deed Answer: C. Forged deed

All of the following items are generally prorated on a hud-1 settlement EXCEPT A.Real estate taxes B.Water bill C.Mortgage interest D.Real estate commissions Answer: D.Real estate commissions

Property that is part of a Bankruptcy Estate is generally transferred by A. Thebuyer B. The bankruptcy judge C. The bankruptcy trustee D. AOTA Answer: C. The bankruptcy trustee

If a judgment is a District Court judgment, notice of lien must be filed in the Circuit Court where the property is located, except in Baltimore City, in order for the lien to attach to real property. A. True B. False Answer: A. True

Adverse possession may be claimed after the following number of years. A. 10year B. 5 years C. 15 years D. 20years Answer: D. 20years

Pursuant to the Maryland Wet Settlement Procedures act, Lenders are required to fund a loan A. The day before closing B. The day of closing C. The day after closing D. Both A and B Answer: D. Both A and B

Who may prosecute an title agent for criminal violations A. The Commissioner B. The underwriter C. The attorney general on behalf of the Commissioner D. The clerk of the court Answer: C. The attorney general on behalf of the Commissioner

The effective date of a Short Form Title Insurance Policy is A. The recording date B. The date documents are executed C. The date the policy is submitted to the underwriter D. The date the policy is submitted to the lender Answer: B. The date documents are executed

Which schedules are contained in a title commitment? A. Schedule A B. Schedule BI C. Schedule BII D. AOTA Answer: D. AOTA

If a grantor warrants a property against claims forever, he has executed a A.Lease hold deed B.Special warranty deed C.General warranty deed D.Quit claim deed Answer: C.General warranty deed

A deed of trust must be executed by A.Only the person executing the note B.All parties that are on the deed to the subject property C.AOTA D.NOTA Answer: B.All parties that are on the deed to the subject property

To show that a mortgage or deed of trust has been paid off, a title company may file with the court a copy of a payoff check and an affidavit as a release A.True B.False Answer: A.True

In order for a commitment or title policy to be binding it must be signed by A. Theunderwriter B. The insurance commission C. The abstractor performing the search D. A validating officer of the title company Answer: D. A validating officer of the title company

Exhibit A attached to a title policy A. Survey B. An endorsement C. A legal description D. A plat map Answer: C. A legal description

All of the following are common characteristics of a surety bond EXCEPT A. It is a contractual agreement B. It protects against default C. It binds the surety D. It protects against embezzlement, larceny and gross negligence Answer: D. It protects against embezzlement, larceny and gross negligence

Which of the following is most unlikely to be a monument in a metes and bounds description? A. Pipe in the ground B. Jones Street C. Oak Tree D. Hay stack Answer: D. Hay stack

Giving something of value in exchange to an insured to induce the purchase of an insurance policy is A. Fraud B. Negligence C. Rebating D. Commingling Answer: C. Rebating

All of the following are examples of endorsements EXCEPT A. Environmentalprotectionendorsement B. Planned unit development endorsement C. FHA mortgage endorsement D. Condominium endorsement Answer: C. FHA mortgage endorsement

MAHT was created to A. To assist victims who suffer because of errors and omissions of title insurers B. To assist with mortgage payment for low income homeowners C. To assist with the purchase of property for low income individuals D. To assist victims of fraud Answer: C. To assist with the purchase of property for low income individuals

The concept that deeds and real estate contracts must be in writing is based on the A. Statute of seisin B. Principals of contracts C. Statute of frauds D. Principals of real property Answer: C. Statute of frauds

All of the following are requirements for an initial license with the MIA EXCEPT A. 18yearsold B. 30 hour pre-licensing education certificate C. Passing of pre-licensing examination D. 16 hours of continuing education Answer: D. 16 hours of continuing education

All of the following are necessary for a complete title search EXCEPT A.Search of property history B.Search person(s)/judgment history C.Search of grantor/grantee index D.Search of employment history Answer: D.Search of employment history

All of the following are exceptions in a policy EXCEPT A.Easement B.Deed restriction C.Right of way D.Interest rate Answer: D.Interest rate

The effective date on a title commitment is A. The date of the last deed transfer B. The date of the last refinance C. The date of the title search D. The last date records are made available at the court house Answer: D. The last date records are made available at the court house

All of the following are true EXCEPT A. Loan policies insure the mortgage or note holder B. Owner policies insure the owner C. Construction loan policies are obsolete D. Leasehold policies are for ground rent properties Answer: C. Construction loan policies are obsolete

When a ground rent is redeemed with SDAT, the ground rent lease is A. Cancelled and the property becomes fee simple B. Extinguished and the property becomes fee simple C. Waived and the property becomes fee simple D. NOTA Answer: B. Extinguished and the property becomes fee simple

Typically in Maryland, the premium for an owner's insurance policy is paid by the A. Seller B. Buyer C. Lender D. Split between seller and buyer Answer: B. Buyer

Which of the following would permit a lender to make a claim against a title insurance company? A. Borrowers default in payment pursuant to a promissory note B. Failure of title agent to issue a loan policy within the time period prescribed by the MIA. C.Failure of the title company to reduce settlement fees D.Failure of title company to pay the borrowers future taxes yearly Answer: D.Failure of title company to pay the borrowers future taxes yearly

Generally, all of the following appear on a HUD-1 statement or Loan Disclosure Form EXCEPT A.Commission B.Lenders fees C.Title fees D.Credit Score Answer: D.Credit Score

Standard title insurance forms/policies are created by A. MLTA B. ALTA C. Commission of insurance D. Insurance underwrite Answer: B. ALTA

All of the following appear in a title insurance commitment EXCEPT A. Requirements B. Exceptions C. Amount of coverage D. Income or ability to pay Answer: D. Income or ability to pay

Another word for a title commitment is A.A title binder B.Insured closing letter C.Insured protection letter D.Closing protection letter Answer: A.A title binder

Which of the following types of policy is generally issued in a refinance transaction? A. Owners policy B. Lender' s policy C. Refinance policy D. Commitmentpolicy Answer: B. Lender' s policy

All of the following are policies that may be issued in a purchase transaction EXCEPT A.Owners policy B.Lenders policy C.Sellers policy D.Leasehold policy Answer: C.Sellers policy

Insurance is based on the following principals EXCEPT A. Risk B. Contract C. Indemnification D. Estate Answer: D.Estate

Which of the following best describes when a loan policy terminates A. 10 years after issuance B. 20 years after issuance C. When the loan is paid off and released D. It is perpetual Answer: D. It is perpetual

If tenancy is omitted from a deed, the tenancy is presumed to be A. Sole owner B. Tenants in Common C. Tenants by the entirety D. Life Estate Tenant Answer: B. Tenants in Common

An abstractor is not responsible for A.Verifying ownership B.Looking at tax records C.Obtaining death certificates D.Obtaining judgment records Answer: C.Obtaining death certificates

An insurable interest must exist A. At The Time the Policy Is Purchased B. At The Time Of Loss C. Insurable Interest Is Not Relevant D. At All Times Answer: B. At the Time Of Loss

Eminent domain allows A. The government to take a property B. A mortgage lender to condemn a property C. An owner to condemn a property D. A tenant to condemn a property Answer: A. The government to take a property

Which deed offers the least protection to a grantee A.Warranty deed B.Special warranty C.Quit claim deed D.Personal representative's deed Answer: C.Quit claim deed

Which of the following is the best example of coverage provided by a title insurance policy A.Provides coverage for lender if borrower defaults B.Provides coverage for lender if borrower dies C.Provides coverage for lender if there are defects in title D.Provides coverage for lender for after acquired judgments Answer: C.Provides coverage for lender if there are defects in title

Restrictive covenants generally appear in which of the following? A. Deed B. Promissory note C. DOT D. Lot and block descriptions Answer: A. Deed

If an owner of real property pays ground rent, his estate is A.Fee simple estate B.Leasehold estate C.A life estate D.Probate estate Answer: B.Leasehold estate

Jack and Jill own property together as tenants by the entirety. Jack and Jill divorced. By operation of law, the tenancy is now A. Jointtenancy B. Tenants in common C. Sole owner D. Still tenants by the entirety Answer: B. Tenants in Common

A contract to issue a title insurance policy is called A.An endorsement B.A commitment C.A requirement D.An exclusion Answer: B. A commitment

Which one of the following is not a valid legal descriptions? A.Metes and bounds B.Block and lot/Plat C.Government/Rectangular D. Address Answer: D. Address

Husband and wife own property as tenants by the entirety and they have one child. The wife dies. The property is now owned by the A.Husband Only B.Husband and Son C.Son Only D.Husband and Heirs Answer: A. Husband Only

Title to real property is most often conveyed by which instrument? A.Deed of trust B.Deed C.Promissory note D.Indemnity deed of trust Answer: B.Deed

A deed requires the signature(s) of A. Grantor only B. Grantor and grantee C. Grantee only D. Attorney only Answer: A. Grantor only

The form of tenancy reserved for husband and wife is A. Joint tenants B. Sole owner C. Tenants by the entirety D. Tenants in common Answer: C. Tenants by the entirety

The best way to protect one's interest from a title defect is to A. Pay cash for property B. Obtain a quit claim deed C. Purchase a title insurance policy D. Obtain an opinion letter from the lender Answer: C. Purchase a title insurance policy

All of the following information are reflected on a license EXCEPT A. Name B. Address C. Date of birth D. Id number Answer: C. Date of Birth

A title insurance producer's license expires A.Every five years B.Never C.Every other year D.Every year Answer: C. Every Other Year

A title agent is required to receive the following number of continuing education hours prior to renewal A. 18 hours B. 8 hours C. 16 hours D. 3 hours if the applicant is an attorney Answer: C. 16 hours

Jack and Jill purchased a parcel of land located in two counties. Which of the following statements is true? A.The deed should be recorded in the county where the largest portion of the property is located. B.The deed of trust should be recorded in the county where the smallest portion is located. C.The deed must be recorded with the department of assessment and taxation D.The deed and deed of trust should be recorded in both counties Answer: D.The deed and deed of trust should be recorded in both counties

Which of the following serves as lien of real property? A.Deed of trust B.Deed C.Right of way D.Power of attorney Answer: A.Deed of trust

A title producer's license is issued by the A. Attorney General's office B. Maryland Insurance Commissioner C. The state assessment office D. The clerk of the court Answer: B. Maryland Insurance Commissioner