DETAILS… DETAILS… TELL ME ABOUT TITLE INSURANCE (Continued)

As an owner, you are concerned about the use and enjoyment of your property without outside interference. To that end, an owner’s policy generally insures that at the time of purchase:

• You have access to the property.
• You are the owner of the property and no one else has a claim of ownership.
• The property is free and clear of liens, except those that may be created by you at or after the time of purchase (e.g., a mortgage lien in favor of your lender).
• There are no title defects that would affect future marketability.

Your owner’s policy does not protect you against all of the risks associated with ownership of real estate. For example, it does not protect you against destruction of improvements to your property by fire (hazard insurance) or flood (flood insurance). Nor does title insurance protect against loss of your property by foreclosure if you stop making your mortgage payments. And your owner’s policy is further limited by specific exceptions related to the property and set forth in the title insurance commitment.

  ♦ Title Policy Exceptions

  ♦ Sample Title Commitment "Exceptions Page"

CLOSING A TRANSACTION

In addition to insuring a transaction, we may be asked to close it. Closings are usually semi-formal, friendly events involving the signing of documents and the exchanging of funds. Most closings are attended by the principals (the borrower, or the buyer and seller) and take place in one of our offices, but we can and do accommodate power of attorney, remote and pre-signings. An average closing takes between ½ and 1 hour.

  ♦ Powers Of Attorney, Mail-Outs & Pre-Signings

Three important documents govern all of our work related to closings - the title commitment, the purchase contract (for sale transactions), and lender instructions (for refinances or sales involving lender financing). Collectively, these documents tell us everything we need to know about a transaction.

The commitment tells us what liens we must pay off and what other matters we need to address in order to insure you (as a buyer) and/or your lender. It also instructs us as to the title fees we must collect. A contract tells us the purchase price, the deed form and the preferred manner of holding title. It tells us what personal property will be transferred. It tells us how to allocate closing costs and what and how to prorate. Lender instructions tell us what lien position we must insure and what loan policy endorsements are required. They instruct us as to the loan amount and the fees that must be paid in conjunction with the loan.

Leading up to closing and based on the applicable governing documents, we obtain those items necessary to satisfy commitment requirements, we prepare a settlement statement showing payments, prorations and proceeds related to the transaction; and (for sale transactions) we prepare the necessary real estate documents. If a lender is involved in the transaction, the lender prepares the loan documents.