Massachusetts Real Estate License Practice Test

What does the term "escheat" refer to in real estate?

1. Transfer of property after someone's death

2. Reversion of property to the state when an owner dies without heirs

3. Encumbrance on property ownership

4. Expropriation of land by government

The correct answer is: Reversion of property to the state when an owner dies without heirs

The term "escheat" refers to the reversion of property to the state when an owner dies without heirs. This legal principle ensures that property does not remain ownerless or abandoned. When an individual passes away without a will and without any identifiable heirs, the state's interest in the property comes into play. Escheat serves to manage property rights and maintain the order of ownership, allowing the state to take over the property, which may then be sold or repurposed according to state laws and regulations. The other options do not accurately convey the meaning of escheat. While the transfer of property after someone's death might refer to probate proceedings, it does not involve the state taking ownership due to lack of heirs. An encumbrance relates to liabilities against the property, such as liens or mortgages, and expropriation pertains to the government's right to take private property for public use, usually with compensation, which is distinct from the escheat process.