Core Exam Prep 2 Real Estate

When two individuals own a property as joint tenants, they each have an equal share and right to the property. In this scenario, the brother's death does not affect the sister's ownership of the property. Since the brother died penniless and left unsecured debts, those debts do not transfer to the sister. Therefore, the sister is now the sole owner of the property, free and clear of any debts from the brother.

Zoning refers to the power of the police to divide land into different districts based on specific regulations and guidelines. This allows for the orderly development and use of land, ensuring that different areas are designated for different purposes such as residential, commercial, or industrial use. Zoning helps to maintain the overall organization and functionality of a city or town, and ensures that land is used in a way that benefits the community as a whole.

The presence of an increasing amount of average priced homes in a neighborhood with a number of high priced homes would tend to make real estate values unstable. This is because the value of the high priced homes may be negatively affected by the presence of lower priced homes, leading to a potential decrease in overall property values in the neighborhood. This could make it more difficult for homeowners in the neighborhood to sell their properties at desired prices and could also impact the overall desirability of the neighborhood.

The correct answer is that both the broker and salesperson may be subject to prosecution. This is because the real estate law prohibits receiving referral fees from lenders that they do business with. Therefore, both the broker and the salesperson are in violation of this law and may face legal consequences.

The time factor does not determine whether an item is a fixture or not. The determination of whether an item is a fixture is typically based on factors such as intention, agreement, and relationship. Time alone does not play a significant role in determining the status of an item as a fixture.

According to the department of real estate, an unlicensed person working for a real estate office must be under the supervision of a licensed individual. This means that the agent cannot work independently and must have a licensed person overseeing their activities.

The correct answer is that the buyer must check the public posted maps to discover and disclose existing hazard information if it is available. The transfer disclosure statement is limited to information that the owner knows. This means that in order to provide a complete hazard disclosure, the buyer must actively seek out and disclose any existing hazard information that is publicly available. The transfer disclosure statement, on the other hand, is limited to the information that the current owner is aware of.

The written contract between the broker and salesperson has to be in writing according to the Rules and Regulations of the Real Estate Commissioner. This means that it is a requirement set by the governing body that oversees real estate practices. It is important for the contract to be in writing to ensure clarity and protection for both parties involved.

Since the question states that Westland had several listings before his death and now his daughter is taking over the business, it can be inferred that the listings would automatically be cancelled and the daughter would need to re-list the properties for the clients. This is because a change in ownership or management often requires updating and re-establishing business agreements and contracts, including property listings.

Misuse of the term "Realtor" is a violation of the California Real Estate Law. This means that using the term incorrectly or falsely claiming to be a Realtor when one is not can result in legal consequences. It is important to adhere to the laws and regulations governing the real estate industry in order to maintain ethical and legal practices.

The federal law requires sellers, landlords, and remodelers to disclose known information about lead-based paint hazards. The question asks for the year when it is assumed that lead paint was last used on homes built before a certain year. The correct answer is 1978, indicating that lead paint was assumed to have been last used on homes built before that year.

The correct answer is "All of the above". This is because all three acts mentioned - showing the property to a new tenant, failing to make necessary repairs, and making extensive alterations - can be considered examples of constructive eviction. Constructive eviction occurs when the landlord's actions or failure to act make the property uninhabitable or significantly interfere with the tenant's use and enjoyment of the property, leading the tenant to abandon the lease. In this case, all three acts mentioned can be seen as actions that would justify a tenant in abandoning the property.

A valid contract requires a meeting of the minds, meaning that both parties involved must have a mutual understanding and agreement on the terms of the contract. It also requires a lawful object, meaning that the purpose of the contract must be legal and not against public policy. Consideration is another necessary element, which refers to something of value exchanged between the parties. However, payment of money or performance is not necessary for a valid contract as there are other forms of consideration that can be exchanged, such as goods, services, or even promises.

The lien started running from the commencement of the installation of the hardwood floor. This means that the contractor's right to place a lien on the property and seek payment for their work began as soon as they started installing the hardwood floor. The lien does not start after the installation is complete, after a certain number of days, or after any specific documentation is recorded.

The listing agreement is a contract between the seller and the real estate agent, outlining the terms and conditions of the sale of the property. As part of the listing agreement, the agent is authorized to accept a deposit on behalf of the seller. This allows the agent to collect a deposit from potential buyers as a sign of their intent to purchase the property. Therefore, the correct answer is the listing agreement.

Mr. Arturian granted a property to Macy with a condition not to drink alcohol beverages. This condition creates a limitation on Macy's ownership, as it can be terminated or revoked if Macy violates the condition. Therefore, Macy's ownership is described as fee simple defeasible, which means that it is subject to a condition or limitation that could result in the termination of the ownership rights.

The agent's action of crossing out the buyer's requirement without their knowledge or consent is considered illegal. This is because the agent made changes to the offer without proper authorization, which goes against the principles of contract law. The agent should have communicated with the buyer and obtained their consent before modifying the offer.

The Real Estate Commissioner may stop the sale of more lots by issuing a desist and refrain order. This order would prohibit the developer from engaging in any further misleading or deceptive practices in the sale of the lots. It is a legal action taken to prevent the developer from continuing their misrepresentations and protect potential buyers from being deceived. This action does not involve revoking the final public report, filling an accusation, or suspending the developer's contractor's license.

The cost approach is a method used to estimate the value of a property based on the cost of replacing or reproducing it. It is commonly used for new buildings because there is a clear understanding of the construction costs involved. The cost approach takes into account the cost of land, materials, labor, and other factors necessary to construct a similar property. By considering the cost of constructing a new building, the cost approach provides an estimate of the property's value.

A blind ad is an advertisement that does not identify the broker. This means that the ad does not disclose the name or contact information of the broker who is advertising the product or service. The purpose of a blind ad is to generate interest and inquiries without revealing the identity of the broker. This can be useful in situations where the broker wants to maintain confidentiality or create a sense of mystery around the product or service being offered. Therefore, the correct answer is "Broker" because a blind ad does not identify the broker.

An agent can refuse to transmit an offer when they are acting on express instructions from the principal. This means that the principal has explicitly instructed the agent not to transmit the offer, and the agent is obligated to follow these instructions. In this situation, the agent is bound by the principal's wishes and must respect their decision.

An exclusive right to sell listing allows an agent to collect a commission even if the property is sold directly by the owner. This type of listing gives the agent the exclusive right to market and sell the property, regardless of who ultimately finds a buyer. The agent is guaranteed a commission as long as the property is sold during the listing period, regardless of who brings the buyer.

The market data approach is accomplished by inferring the value of a property based on comparable properties. This means that the value of the property being assessed is determined by looking at the prices at which similar properties in the market have been sold. By comparing the features, location, and condition of the comparable properties to the subject property, an estimate of its value can be made. This approach is commonly used in real estate appraisals to determine the fair market value of a property.

An appurtenant easement is an easement that is attached to and benefits a specific piece of land. It allows the owner of the dominant property to use a portion of the servient property for a specific purpose, such as access or utilities. This type of easement is typically transferred with the land, meaning that if the dominant property is sold, the new owner will also have the right to use the easement.

Zoning is an example of police power because it is a legal mechanism used by local governments to regulate land use and development. Through zoning, authorities can divide a municipality into different zones or districts, each with specific regulations and restrictions on how the land can be used. This allows the government to promote public health, safety, and welfare by ensuring that certain activities or structures are appropriately located and that incompatible land uses are separated. Zoning can help maintain the character of a neighborhood, control population density, and prevent conflicts between different types of land uses.

In a tight money market where there is a lack of funds available for real estate loans, it would be advantageous for a lender to waive a payment penalty clause contained in a promissory note. This is because in such a market, borrowers may have difficulty finding alternative sources of funds, and by waiving the penalty clause, the lender can attract more borrowers and potentially increase their loan portfolio.

The appraiser must have a general appraisal license in order to appraise a commercial building for $550,000. This license allows the appraiser to assess the value of various types of properties, including commercial buildings.

The District Attorney is responsible for prosecuting individuals who commit crimes, including those who engage in illegal activities such as selling real estate without a license. Since David sold his friend's home without a license and received a commission, he can be prosecuted by the District Attorney for his actions.

This answer is correct because the question asks for an exception to the ways in which a lessee may abandon the property. The other options listed are all valid reasons for a lessee to abandon the property, such as condemnation by eminent domain, failure of the landlord to make repairs, and eviction notice. However, when the property becomes dilapidated due to the tenant's negligence, it is not a valid reason for the lessee to abandon the property.

When Fuentes purchased Brown's house and agreed to assume the existing mortgage, it means that Fuentes has taken over the responsibility of paying off the loan. This relieves Brown from any future liabilities or obligations towards the mortgage. Fuentes becomes the primary responsible party for repaying the loan, while Brown is no longer liable for it.

A voidable contract is a contract that is valid and enforceable on its face, meaning that it meets all the legal requirements to be considered a valid contract. However, it may be rejected or canceled by one of the parties involved. This means that although the contract is initially binding, one of the parties has the option to void or cancel it if certain conditions or circumstances arise.

An appraisal for a medical dental building is least concerned with the general state economy because the demand for medical and dental services is generally not heavily influenced by economic conditions. People still require healthcare services regardless of the state of the economy. Therefore, the value of a medical dental building is more likely to be determined by factors such as its location, size, condition, and the demand for healthcare services in the specific area, rather than the overall state of the economy.

When a property is being sold through an option, the broker must inform the client that he is acting as a principal. This means that the broker is not just an agent or intermediary, but is actually buying or selling the property on their own behalf. This distinction is important for the client to understand, as it affects the broker's obligations and responsibilities in the transaction.

According to the principles of the Easton vs. Strassburger case, real estate licensees are obligated to provide prospective buyers with a list of known defects and those that should be known. This means that the licensees must disclose any defects that they are aware of, as well as any defects that a reasonable person in their position should have known about. This ensures that the buyer is fully informed about the condition of the property before making a decision to purchase it.

A seller's market refers to a situation where there is high demand for a product or service, but the supply is limited. This leads to an increase in prices as sellers have the advantage of scarcity. In this case, the correct answer is "High prices of a product with demand and supply lags" because it accurately describes the concept of a seller's market where prices are high due to limited supply and high demand.

A power of attorney is a legal document that allows one person (known as the principal) to appoint another person (known as the attorney-in-fact) to act on their behalf and make decisions or perform tasks on their behalf. The attorney-in-fact is authorized to represent the principal in various matters, such as signing legal documents, managing finances, or making healthcare decisions. Therefore, a power of attorney is a document that is used to represent another person and give them the authority to act on their behalf.

The correct answer is "Determination of correct boundary lines and property survey". This is not one of the three processes in the standard policy of title insurance. The three processes are: Amount of insurance required, Title investigation, and Protection of title losses.

This scenario is an example of economic obsolescence. Economic obsolescence refers to a decrease in the value of a property due to external factors such as changes in the surrounding neighborhood or economic conditions. In this case, the high-quality home is constructed in a neighborhood where the value of homes is only $100,000. This difference in value would likely impact the marketability and potential resale value of the home, resulting in economic obsolescence.

CPI refers to Consumer Price Index, which is a measure of the average change over time in the prices paid by urban consumers for a market basket of consumer goods and services. It is commonly used to track inflation and adjust lease payments for commercial properties. Therefore, the correct answer is "Commercial leases".

If a lender decides to take a deed in lieu of foreclosure, it means that the borrower willingly transfers the ownership of the property to the lender to avoid foreclosure. By doing so, the lender assumes any junior liens that may be attached to the property. This means that the lender becomes responsible for paying off any outstanding debts or liens that are subordinate to the primary mortgage. Therefore, the lender will own the property free and clear of the primary mortgage, but will still be responsible for any junior liens.

A listing must contain compensation, lawful object, and unspecified consideration. However, it does not need to be notarized by a notary. Notarization is a process where a notary public verifies the authenticity of a document and the identity of the signatories. While it may be beneficial to have a listing notarized for added legal protection, it is not a requirement.

Under the truth and lending law, the disclosure is presented by the lender. This means that the lender is responsible for providing all necessary information and details regarding the terms and conditions of the loan or credit being offered. This disclosure is important to ensure transparency and to protect the borrower's rights by providing them with the necessary information to make an informed decision. The lender is legally obligated to provide this disclosure to the borrower before any agreement or contract is finalized.

Restrictions are not considered a lien because they do not involve a creditor's claim on a property. Liens are legal claims that give creditors the right to take possession of a property if the debtor fails to repay a debt. Taxes, trust deeds, and judgments, on the other hand, are all examples of liens as they involve a creditor's claim on a property for unpaid taxes, mortgage debt, or court-ordered payments, respectively.

Inverse condemnation is the correct answer because it refers to a legal proceeding against government authorities when they take or damage private property without formally exercising their power of eminent domain. In this case, Omedo's home being close to an airport could potentially be affected by the government's actions, leading to an inverse condemnation claim.

According to the department of real estate, the correct answer is that an agent can only advertise on the World Wide Web using advertisements provided by qualified real estate licensees. This means that the agent cannot create their own advertisements or use advertisements from individuals who are not qualified real estate licensees. The department of real estate has specific regulations in place to ensure that only licensed professionals are involved in advertising real estate on the internet.

An estate at sufferance refers to a situation where a tenant continues to possess the leased property after the expiration of their lease term without the landlord's approval. In this case, the tenant is essentially holding over without any legal right to do so. This can occur when a tenant fails to vacate the premises or renew the lease. The landlord may have the right to evict the tenant through legal means.

The lease contract would be voidable by the lessee because Mr. Michaels is imposing an additional requirement on Jack after the lease agreement has already been signed and Jack has moved in. This requirement to make substantial capital improvements to the property was not part of the original lease agreement and is being added later, which goes against the terms of the initial contract. Therefore, Jack has the right to void the lease contract if he does not agree to this new requirement.

Dual agency refers to a situation where a broker represents both the buyer and the seller in a real estate transaction. In this scenario, the broker has a listing and one of his salespeople sells the listing, which means that the broker is acting as a dual agent. As a dual agent, the broker has a fiduciary duty to both parties and must ensure that their best interests are protected. This arrangement can present potential conflicts of interest and requires the broker to maintain impartiality throughout the transaction.

When one joint tenant executes a mortgage or deed of trust creating a lien against their interest, it does not sever or end the joint tenant estate. This means that the joint tenancy continues to exist, and the other joint tenant(s) still hold their interest in the property. The mortgage or deed of trust only creates a lien on the interest of the joint tenant who executed it, but it does not affect the joint tenancy as a whole.

$178,000 / $1,200 = 148.33
148.33 X $1,300 = $192,833

According to the income tax law, a salesperson is considered a self-employed contractor. This means that they work independently and are not considered an employee of the broker they work for. As a self-employed contractor, the salesperson is responsible for their own taxes and expenses, and they are not entitled to benefits such as medical insurance from the broker.

This is an example of a variance. A variance is a permission granted by a local government to allow a property owner to deviate from certain zoning regulations or building codes. In this case, the city made a change in zoning that is not permitted in the construction industry, indicating that they granted a variance to allow this change.

When a home is financed under the State of California Veterans Farm and Home Purchase Plan, a real property purchase contract is used. This contract is a legally binding agreement between the buyer and seller that outlines the terms and conditions of the home purchase. It includes details such as the purchase price, financing terms, contingencies, and closing date. This document is essential in ensuring that both parties are aware of their rights and obligations during the home buying process.

A reconveyance deed is a legal document that transfers property from a trustee back to the trustor. This typically occurs when a mortgage or loan has been fully paid off, and the trustee is releasing their interest in the property. The reconveyance deed serves as proof that the trustor now has full ownership and control over the property. It is an important document in the process of transferring property rights and ensuring that the trustor's ownership is legally recognized.

An appraiser will deduct the vacancy factor of an apartment to reach the effective gross income. This is because the vacancy factor represents the percentage of time that the apartment is expected to be vacant and not generating rental income. By deducting this factor from the gross income, the appraiser can calculate the effective gross income, which is the income generated by the property after accounting for vacancies.

SW ¼ of the NW ¼ of section 5 = 40 acres x $800 = $32,000
S ½ of the NE ¼ of section 8 = 80 acres x $500 = $40,000
$40,000 - $32,000 = $8,000

By executing a note deed of trust against the home, the borrower has created a lien on the property. As joint tenants, both friends have equal ownership and rights to the property. If the borrower were to die before paying off the debt, the lien would still be in effect. This would put the beneficiary in a precarious position because they would now be responsible for the debt, potentially affecting their ownership and rights to the property.

In this situation, the correct answer is interpleader action. Interpleader action is a legal process in which a neutral third party, typically a court, is asked to resolve a dispute between two parties who both claim the same funds or property. In this case, the conflict between the buyer and seller regarding the return of the deposit from the trust account can be resolved through an interpleader action, where the court can determine the rightful recipient of the funds. This allows the broker to avoid being caught in the middle of the dispute and transfers the responsibility of resolving the conflict to a neutral party.

A deed serves as evidence of a change in title or an interest in a property. It provides legal proof that ownership of a property has been transferred from one party to another or that a specific interest, such as a mortgage or easement, has been created. The deed is an important document that establishes the rights and obligations of the parties involved and is often recorded in the county recorders office to ensure its validity and to provide public notice of the transaction.

Orientation refers to the placement of a building on the land in relation to its surroundings, such as the direction it faces or its alignment with the sun. It involves considering factors like sunlight, wind patterns, and views in order to optimize energy efficiency, natural light, and overall functionality of the building. The orientation of a building can have a significant impact on its performance and the comfort of its occupants.

The maximum fine that may be imposed by the Real Estate Commissioner against a broker who pays an unlicensed person for soliciting borrowers or negotiating real estate loan is $10,000.

An acre after deductions for streets, sidewalks, curbs, and alleys is considered a commercial acre because it refers to the area of land that remains after subtracting the space occupied by infrastructure such as streets, sidewalks, curbs, and alleys. This indicates that the remaining land is available for commercial use or development.

When the Real Estate Commissioner wishes to proceed against a licensee for a suspected violation of the Real Estate Law, they must first serve the real estate licensee with an accusation. An accusation is a formal document that outlines the specific charges against the licensee and initiates the disciplinary process. It notifies the licensee of the alleged violations and gives them the opportunity to respond and defend themselves. Serving the licensee with an accusation is the first step in taking legal action against them for the suspected violation.

The cost approach is a method used to estimate the value of a property by considering the cost of replacing it with a similar property. It is commonly used in new construction, special properties, and commercial buildings. However, the cost approach does not set the lower limits of value. Instead, it provides an estimate of the upper limit of value, as it assumes that a buyer would not pay more for a property than the cost of acquiring a similar property.

Cosmetic maintenance refers to the regular repairs and upkeep of a property that are necessary to maintain its appearance and aesthetic appeal. These repairs are typically minor in nature and may include tasks such as painting, replacing fixtures, or fixing cosmetic damages. Unlike rehabilitation, which involves major renovations or improvements, cosmetic maintenance focuses on addressing minor issues and maintaining the overall appearance of the property. Therefore, it is the correct answer in this context.

The correct answer is "Final acceptance was communicated to the offeror." This means that the date in the purchase contract is the date when the offeror received the final acceptance of their offer. This is an important date because it marks the point at which the contract becomes legally binding. The other options, such as when the buyer signed or when the deposit was received, may be important dates in the process but are not necessarily the date that determines the validity of the contract.

A board foot is a unit of measurement used in the lumber industry. It represents the volume of wood in a piece that measures one foot by one foot by one inch. Therefore, the correct answer is six inches by twelve inches by two inches, as this combination of dimensions equals one board foot.

The correct answer is "Lower loan to value ratio". This means that the conventional loan offers a lower loan amount compared to the value of the property being financed. This can be beneficial for borrowers as it reduces the risk for the lender and may result in lower interest rates and payments. FHA loans, on the other hand, typically have higher loan to value ratios, allowing borrowers to finance a larger portion of the property's value.

An earthquake hazard report must be issued to properties in all counties. This means that regardless of the location within California or the type of structure, all properties in every county must receive an earthquake hazard report. This ensures that all residents and property owners are aware of the potential risks and can take necessary precautions to mitigate the impact of earthquakes.

Capitalization rate is a financial metric used in real estate to convert the income generated by a property into its value. It is calculated by dividing the net operating income (NOI) of the property by its purchase price or current market value. The capitalization rate helps investors determine the potential return on investment and compare different properties. By converting income into value, the capitalization rate allows investors to make informed decisions about the profitability and worthiness of a property.

$60 x 12 = $720 per year
$720 / 8% = $9,000

When a joint tenant mortgages his or her share, it does not terminate the joint tenancy. The joint tenancy will still exist, but the mortgage will create a lien on the joint tenant's share. The other joint tenants will still have the right of survivorship and will inherit the mortgaged share if the joint tenant dies.

When a bond, deed of trust, or notes are held by a third party, it is referred to as "escrow." Escrow is a financial arrangement where a neutral third party holds assets or documents until certain conditions are met. In this case, the third party holds these important legal documents on behalf of the parties involved, ensuring that all conditions are fulfilled before transferring ownership or funds. The term "escrow" is commonly used in real estate transactions, where the escrow agent holds the deed and funds until the sale is completed.

The correct answer is "The rate stated in the loan documents." This refers to the interest rate that is explicitly mentioned and documented in the loan agreement or contract. It is the rate that the borrower agrees to pay on the loan.

The salesperson does not have an attorney-client relationship. This relationship typically exists between a lawyer and their client, where the lawyer provides legal advice and representation to the client. In the given options, the other relationships mentioned - attorney-in-fact, broker-client, and fiduciary - do not involve the salesperson.

The correct answer is Jackson must sell because the doctrine of estoppels will apply in this case. This means that Jackson is legally bound to sell the property to Sullivan because Sullivan made significant improvements to the property in reliance on the verbal agreement. The doctrine of estoppels prevents Jackson from going back on his word and reneging on the agreement.

When applying the capitalization of net income approach, the cost of capital is not included as an expense. The capitalization of net income approach calculates the value of an income property by dividing the net operating income (NOI) by the capitalization rate. The capitalization rate represents the rate of return an investor expects to receive on the property. Expenses included in the calculation are those that directly impact the property's operating income, such as utilities, property management, and reserves for replacement of improvements. The cost of capital, on the other hand, represents the cost of financing the property and is not considered an operating expense.

A pest control company must provide a copy of the rules and regulations to the owner of the property. This is important as the owner needs to be aware of the procedures and guidelines that the pest control company will follow while carrying out their services. By providing a copy to the owner, the pest control company ensures transparency and allows the owner to have a clear understanding of the process. This also helps in establishing a good communication channel between the owner and the pest control company.

Equitable title refers to the buyer's interest or right in a property before the legal title is transferred. It signifies that the buyer has an equitable claim to the property and can enforce specific performance if the seller breaches the contract. In this context, once a binding contract is established between the buyer and seller, the buyer obtains equitable title, indicating their ownership rights in the property. This means that although the legal title has not yet been transferred, the buyer has a valid claim and can seek legal remedies if necessary.

The maximum amount that may be recovered from the Recovery Trust Fund is $100,000. This means that if there are any losses or damages that need to be compensated, the maximum limit that can be claimed from the fund is $100,000.

Conformity refers to the degree to which a property aligns with the architectural design and style of the neighborhood. When a property blends in well with the surrounding buildings and follows the established aesthetic, it tends to have a higher value. This is because conformity enhances the overall visual appeal and harmony of the neighborhood, which is desirable for potential buyers or investors. Therefore, the correct answer is conformity.

A net listing is a type of listing agreement where the seller sets a desired net amount for the sale of the property, and any amount above that net amount is considered the agent's commission. In this type of listing, the seller has the right to refuse to pay a commission to the agent, even if the agent is the procuring cause of the sale. This is because the agent's commission is not predetermined or agreed upon in a net listing, and it is solely dependent on the final sale price exceeding the seller's desired net amount.

The appropriate termination date for a broker to legally claim a commission on an exclusive right to sell listing is for 180 days from the date the listing agreement is signed by the contracting parties. This means that the broker has the right to claim a commission for a period of 180 days from the signing of the agreement, after which the agreement will terminate.

The earthquake booklet was not necessary to be disclosed if the property was built after 1960. This suggests that before 1960, it was required to disclose the earthquake booklet for properties, but after that year it became unnecessary. The reason for this could be that building codes and regulations were strengthened after 1960, making it less necessary to disclose the booklet for newer properties.

The assessment roll, compiled by the assessor's office, serves the purpose of establishing the tax base. This means that it provides a record of the assessed values of all properties within a jurisdiction, which is used to calculate the amount of taxes that property owners are required to pay. The assessment roll is an important tool for ensuring that taxes are levied fairly and accurately, as it helps to determine the value of each property and distribute the tax burden equitably among property owners.

The correct answer is that the broker must give the check to the seller. This is because the seller requested the check from the broker, indicating that they want to receive the deposit directly. The broker is obligated to follow the seller's instructions and provide them with the check.

The correct answer is Trustor. In a default situation, the possession of the property is held by the Trustor. The Trustor is the person who created the trust and transferred the property into it. They retain control and possession of the property until a default occurs, at which point the property may be transferred to the trustee or another party involved in the trust.