Frequently Asked Questions About Title Insurance
But the lender already requires Title Insurance, won't that protect me?
The real estate broker said the title is good. Isn't that good enough?
What happens if my home is protected by title insurance and it's challenged?
If the note is only in my name, why does my spouse have to sign the mortgage?
The legal answer is "the application of insurance principles to hazards inherent in real estate titles."
The purchase of a home is, in most cases, the largest financial commitment in an individual's lifetime.
• Title Insurance protects you against losses due to defects in the title of the property or expenses in legal defense.
• Your ownership is authenticated and will be promptly defended against any claims, in court if necessary at no cost to you, whether a claim is valid or not.
• A title insurance policy will protect you and your heirs as long as you have an interest in the property.
• If a valid claim is made against your title as covered by your policy, the title insurer protects you by bearing the cost of settling the claim should it prove valid, in order to protect your title and keep you in possession of your property.
Most definitely! Title insurance is a means of protecting yourself from financial loss in the event that problems develop regarding the rights to ownership of your property. There may be hidden title defects that even the most careful title search will not reveal. In addition to protection from financial loss, title insurance pays the cost of defending against any covered claim.
A title search is a detailed examination of the historical records concerning a property. These records include deeds, court records, property and name indexes, and many other documents. The purpose of the search is to verify the seller's right to transfer ownership, and to discover any claims, defects and other rights or burdens on the property.
A title search can show a number of title defects and liens, as well as other encumbrances and restrictions. Among these are unpaid taxes, unsatisfied mortgages, judgments against the seller and restrictions limiting the use of the land.
Yes. there are some "hidden hazards" that even the most diligent title search may never reveal. For instance, the previous owner could have incorrectly stated his marital status, resulting in a possible claim by his legal spouse. Other "hidden hazards' include fraud and forgery, defective deeds, mental incompetence, confusion due to similar or identical names and clerical errors in the records. These defects can arise after you've purchased your home and can jeopardize your right to ownership.
No other property has a useful life that compares with that of land. Owners die, new ones succeed, but land goes on forever. Owners of goods may change their locations at will, but land is immovable, it lends itself to the absorption of innumerable rights. Over the ages, this so impressed lawyers and jurists that they formed a separate body of laws for land. These laws, creating many types of rights in land, are so numerous and so complex it is impossible for there to be a mathematical certainty of ownership.
Also, because land is permanent and can have many owners over the years, various rights in land may have been acquired by others (such as mineral, air, or utility rights) by the time you come into possession of it, even if the land has never before been built upon. So, in order to transfer a clear title to a piece of land, it is first necessary to determine whether any rights are outstanding.
Not necessarily. There are two types of Title Insurance. Your lender likely will require that you purchase a Lender's Policy. This policy only insures that the financial institution has a valid, enforceable lien on the property. Most lenders require this type of insurance, and typically require the borrower to pay for it.
An Owner's Policy on the other hand is designed to protect you from title defects that existed prior to the issue date of your policy. Title troubles, such as improper estate proceedings or pending legal action, could put your equity at serious risk. If a valid claim is filed, in addition to financial loss up to the face amount of the policy, your owner's title policy covers the full cost of any legal defense of your title.
Anything in the entire ownership of a piece of real estate which may encumber the owner's right to the "peaceful enjoyment" of the property or which may cause the owner to lose any portion of the property.
If anything should happen to defeat the title, your cause of action would be against the seller, and his ability to pay. Attorney's fees and expenses would not be covered.
No one can be sure the title is clean.
You notify the title insurance company and they defend the title, even if it goes to court. The title company bears all expenses.
The one-time premium is directly related to the value of your home. Typically, it is less expensive than your annual auto insurance. It is a one-time only expense, paid when you purchase your home. Yet it continues to provide complete coverage for as long as you, or your heirs, own the property.
Florida regulates the rates on the premiums for title insurance. The only costs that may differ would be the actual fees, such as search and examination, closing, and miscellaneous fees such as wire transfers, FedEx or courier fee and endorsements.
Yes. We act as a central clearinghouse for the parties involved—collecting necessary documents, insuring adherence to the lender's title instructions, making arrangements for proper payment and distribution of funds. We are fully prepared to work with you from the beginning of your transaction all the way through to conclusion.
Closing costs are customarily, but not always, divided between the buyer and seller, as follows*:
Buyer
Recording Fees - Record Deed: $10.00 first page, $8.50 each additional page;
Record Mortgage: $10.00 first page, $8.50 each additional page
State Documentary Stamp Tax - $0.35 per $100.00 or fraction thereof based on the
amount of the mortgage
Intangible Tax - 2 mils per dollar of exact mortgage amount (approx.
$0.20/hundred)
Termite Inspection - $45.00 - $65.00
Survey - $225 - $360
Lender's Title Insurance Policy - If issued simultaneously with Owner's Policy,
$25.00 in most cases
Refinances - Variable, depending on production of Prior Owner's Title Insurance
Policy
Endorsements to Lender's Policy - If required by Lender, $25.00 and up depending
on type of endorsement
Express Mail - If applicable, charged to the appropriate party
Settlement Fees - Up to $350.00 if a mortgage is involved.
Seller
State Documentary Stamp Tax for Deed of Conveyance - $0.70 per $100.00 or
fraction thereof
Assessment Search - $15.00 - $40.00, depending on City
Owner's Title Insurance Policy - Based on the sales price
Taxes - Current year's real estate taxes are prorated as closing
Title Search and Exam - Approximately $200.00
Settlement Fee - Approximately $150.00 - $200.00
* Prices are subject to change without notice
You will want to have these items complete or in
hand when you come to the closing (please confirm with your escrow officer prior
to closing):
Buyer
Buyer's copy of purchase agreement
Cashier's check for amount needed to close
Proof of purchase of insurance for fire, casualty, etc.
Photo identification (passport, driver's license, or state-issued identification
card)
Seller
Seller's copy of purchase
agreement
Any unrecorded instruments that affect the title
Proof of satisfaction of any mechanics' liens, chattel mortgages, judgments, or
mortgages that were paid prior to the closing
Photo identification (passport, driver's license, or state-issued identification
card)
Yes, in Florida a married person can acquire (purchase) and convey (sell) property individually. However, in the case of homestead property, the spouse must join in the conveyance.
Yes, you can. However, if you decide to sell, since minors lack the capacity to enter legal agreements, a guardian must be appointed by the court of equity. The guardian could be one or both parents or a third party appointed by the court called guardian ad litem. The court gives to this guardian the authority and responsibility to look after the minor's best interests.
If the property is going to be the primary residence of the married couple, then it is necessary for your spouse to sign in acknowledgement that he/she knows that the property is being encumbered and that there is a note that needs to be paid by the borrowers' heirs. In short, someone has to keep on paying the mortgage until it is paid in full.
Some of the most common requirements prior to closing are listed below. These items need some time
allocated to them and the closing date should not be scheduled until all received and approved. These are
usually ordered upon final approval since this expense is payable regardless if there is a closing or not.
Commonly these are the buyer's cost.
Termite Inspection - if it is not clear, the seller will need time to do the necessary repairs.
Survey
Hazard Insurance
C Coordinate closing date and time with all parties.
All parties must bring proof of identification to closing. This can be in the form of a valid Driver's License, Passport or other photo identification card. Sellers should bring proof of Tax Identification, such as a Social Security Card.
If the buyers need to bring money to closing it must be in the form of a Cashiers Check payable to the title company. Therefore, keep in mind that you will have to go to the bank. The buyer is the one that has to sign the most documents. An FHA or VA mortgage will have approximately 72 documents.
The closing may be done as a mail away. This means that either party or both will not be attending the closing and the documents are sent via Federal Express to them. This requires that the title closer or his/her processor have the party's phone number to coordinate the exact address to ship the documents to and the time frame needed to return the documents. Usually the real estate professional will find out the possibility of this situation as soon as they get the contract and will alert the title closer from the moment they send the title order.
It takes approximately an hour and a half and during the whole closing the title closer will be describing and explaining the documents that you will be signing. Also, he/she will be giving you other very important information like when and how to file your homestead exemption.