### What is an unrecorded deed? - [x] An official deed transferring tangible property without being recorded in local records - [ ] A checklist of property taxes owed - [ ] A deed that has been certified by the federal government - [ ] A temporary ownership document for real estate transactions > **Explanation:** An unrecorded deed is an official deed transferring tangible property that has not been recorded in local records. It remains a legal deed as long as it is executed by the property owner, but it may pose legal questions and complications. ### What legal issues can arise from an unrecorded deed? - [x] Judgments against the property may be held against the former owner - [ ] The property automatically belongs to the local government - [ ] The deed instantly becomes void - [ ] The former owner can reclaim the property at any time > **Explanation:** Because the deed is not recorded, judgments against the property may still be held against the old owner, potentially leading to legal disputes and complications. ### Why should someone receiving an unrecorded deed hire an attorney? - [x] To verify the sale was legal - [ ] To record the deed with the local government - [ ] To get a better interest rate on their mortgage - [ ] To obtain insurance for the property > **Explanation:** Consulting an attorney is important to ensure that the sale was legal and to potentially resolve any legal questions and disputes that may arise from the deed not being recorded. ### Can insurance companies refuse to cover a property with an unrecorded deed? - [x] Yes, if the property has not been properly recorded - [ ] No, insurance companies must cover all properties regardless of recording status - [ ] Yes, but only if the property is residential - [ ] No, insurance is independent of property recording status > **Explanation:** Insurance companies generally will not cover a property if it has not been properly recorded. If the property is not recorded, they may refuse to cover claims, even if the owner has been paying premiums for years. ### How does an unrecorded deed affect property insurance claims? - [x] The insurance company can refuse to cover the claim - [ ] The property value is automatically lowered - [ ] The premiums are increased - [ ] The dispute is resolved by local government > **Explanation:** If an insurance company discovers that a property deed is unrecorded, they may refuse to cover any claims, leading to potential financial loss for the property owner. ### Is an unrecorded deed still a legal document? - [x] Yes, if executed by the property owner - [ ] No, it is not recognized until recorded - [ ] Yes, but only for six months - [ ] No, it needs federal certification > **Explanation:** As long as the unrecorded deed is executed by the property owner, it remains a legal document, although it may still present certain legal risks. ### What is the primary risk of having an unrecorded deed? - [x] It poses legal questions and potential coverage issues with insurance companies - [ ] It automatically nullifies the property sale - [ ] It necessitates increasing the property taxes - [ ] It requires federal government intervention > **Explanation:** The primary risk of an unrecorded deed is that it can lead to legal uncertainties and issues with obtaining property insurance coverage. ### How can an unrecorded deed be contested? - [x] Through legal means - [ ] Via county assessor reviews - [ ] Through public auctions - [ ] By local neighborhood votes > **Explanation:** Legal civil proceedings are often necessary to clear up any issues or uncertainties surrounding an unrecorded deed. ### What role do local records play in property transactions? - [x] They formally record deeds and help ensure clear ownership and legal standing - [ ] They estimate market value for the property's insurance - [ ] They offer financial assistance to new homeowners - [ ] They auction unrecorded property to the highest bidder > **Explanation:** Local records play a crucial role in formally registering property deeds, which helps ensure clear ownership and legal standing of real estate transactions. ### Why might an unrecorded deed lead to ambiguity? - [x] Because it isn't officially noted in local governmental records - [ ] Because it hasn't been presented to a federal court - [ ] Because it doesn't include property use rights - [ ] Because the previous taxes aren't settled > **Explanation:** The lack of formal recording in local governmental offices means that there is no official documentation of the property transfer, leading to potential ambiguities and disputes over ownership or title issues.