Premier Nationwide Lending » Title Company

Why Title Insurance is Important

Rob Spring — Mon, 30 Nov 2009 03:34:16 +0000

Title Insurance = Peace of Mind

Purchasing a home is probably the single biggest investment you will ever make. Before closing on the house, you’ll want to know that no other individual or entity has a right, lien, or claim to the property.

Determining that your rights and interests to the property are clear is the business of a Title Insurance Company.

For a modest, one-time title insurance premium, you will receive continuous title insurance protection in an amount equal to the purchase price of the property or its current market value. This premium typically includes your “owners” policy as well as the “lenders” policy.

One of the marked advantages of title insurance is that prior to a policy being issued, the title insurance company completes extensive research into relevant public records, maps and documents to trace ownership of the property and determine if anyone other than you has an interest in the property. Through its research, the title insurance company can usually identify any title problems that may arise and have these problems cleared-up prior to closing.

Your title insurance owner’s policy will describe the property and outline any recorded limitations on your ownership. It will also set forth the title insurance company’s responsibilities should any claim covered by the policy terms arise. Typically your title insurance will protect you from loss:

If someone contests your title in legal action (the title insurance company will defend the title at no expense to you)
Or if there is a title defect that cannot be eliminated (the title insurance company will protect you from financial loss – up to the amount of the policy).

Getting to Know the Escrow Holder

Rob Spring — Tue, 24 Nov 2009 18:13:47 +0000

Closing the Sale

Escrow
To finalize the sale of the home, a neutral third party (the escrow holder, a.k.a. escrow agent) is engaged to assure the transaction will close properly and on time. The escrow holder insures that all terms and conditions of the seller’s and buyer’s agreement are met prior to the sale being finalized, including receiving funds and documents, completing required forms, and obtaining the release documents for any loans or liens that have been paid off with the transaction, assuring you clear title to your property before the purchase price is fully paid.

The documentation the escrow holder may be collecting includes:

Loan documents
Tax statements
Fire and other insurance policies
Title insurance policies
Terms of sale and any seller-assisted financing
Requests for payment for various services to be paid out of escrow funds

Upon completion of all instructions of the escrow, closing can take place. All outstanding payments and fees are collected and paid at this time (covering expenses such as title insurance, inspections, real estate commissions). Title to the property is then transferred to the seller and appropriate title insurance is issued as outlined in the escrow instructions.

At the close of escrow, payment of funds shall be made in an acceptable form to the escrow. As your real estate agent, I’ll inform you of the acceptable form.

The Escrow Holder Will:		The Escrow Holder Won’t:
Prepare escrow instructions Request title search Comply with lender’s requirements as specified in the escrow agreement Receive funds from the buyer Prorate insurance, tax, interest and other payments according to instructions Record deeds and other documents as instructed Request title insurance policy Close escrow when all instructions of seller and buyer have been met Disburse funds and finalize instructions		Give advice – the escrow holder must maintain neutral, third-party status Offer opinions about tax implications

What is a Mortgage Escrow Account?

Rob Spring — Tue, 24 Nov 2009 18:02:02 +0000

Mortgage Escrow Account

A Mortgage Escrow Account is established to pay on-going expenses while there is a loan on the house. These expenses include property taxes, home insurance, and mortgage insurance. Generally, the Escrow Account is partially funded at closing (Labeled “Pre-Paid Items”) and the home buyer makes on-going contributions with their monthly mortgage payment.

Very different from “Escrow” this is an account maintained by the lender and funded by you to pay on-going expenses, such as property taxes and home owner’s insurance. See the Real Estate Definition below.