National Real Estate Practice Exam

In this scenario, the nephew's interest in the property is classified as an estate in remainder. A life estate is established for the grandson, meaning he has the right to possess and use the property during his lifetime. Upon the grandson's death, the title will then transfer to the nephew. This transfer of interest qualifies as a remainder because it involves the nephew waiting to receive full ownership of the property once the previous life estate holder (the grandson) passes away.

The concept of a remainder is important in property law, as it ensures that interests in property are clearly defined and that future ownership is anticipated and legally recognized. The nephew's interest will only become active after the life estate ends, which aligns perfectly with the definition of a remainder interest. This highlights a structured approach to property rights where different parties have distinct, but connected, claims to an estate based on life events.

Other types of estates, such as a reversion, would involve the original grantor having the future interest once the life estate ends, and an estate for years typically pertains to a leasehold for a set duration, neither of which apply in this case. A periodic estate involves a lease that automatically renews, which is also not relevant here. Thus, the nephew's future ownership