Texas Real Estate State Practice Exam

Which type of estate has a termination date and could be defeated or terminated if certain conditions are violated?

1. Defeasible Fee

2. Life Estate

3. Qualified Fee

4. Fee Simple

The correct answer is: Defeasible Fee

A defeasible fee estate is a type of ownership in real property that has specific conditions attached to it, meaning that it can be terminated if those conditions are violated. This distinguishes it from other types of estates that do not have these conditional limitations. In a defeasible fee estate, the grantor retains a future interest in the property, and if the stipulated conditions are not met, ownership can revert to the grantor or another designated party. In contrast, a life estate provides ownership for the duration of a person's life but does not contain conditions that can lead to termination. A qualified fee, while similar, is less commonly referred to and typically implies that the estate is held with certain qualifications that could lead to a defeasance but lacks the specificity associated with defeasible fee estates. Fee simple ownership, on the other hand, is the most complete form of ownership and is not subject to conditions that would terminate the estate, representing an absolute and unconditional ownership of the property. Understanding the characteristics of these estate types, especially the conditional nature of a defeasible fee, is crucial for anyone studying real estate law and ownership rights.