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FAQs

What does escrow do for me?
What is a mobile notary or mobile closing?
I will be out of town for the closing. How will escrow handle this?
Why do I need title insurance?
Do I need title insurance if I’m buying a condominium?
How are title insurance premiums determined?
What are the primary differences between a Standard Owner's Policy and a Home Owner's Policy?
Why does my lender require me to purchase a loan title policy?
I'm refinancing, why do I need title insurance?
I'm buying new construction, do I need title insurance?
How do I file a title insurance claim?

What does escrow do for me?

Escrow staff works as a neutral third-party whose purpose is to follow the instructions laid out in the real estate contract and successfully close the transaction. Escrow takes direction from the real estate contract to which all parties have agreed. This includes ensuring that no money changes hands until all contingencies have been met and all title issues are cleared. The cost of escrow is typically divided evenly between the buyer and the seller. Escrow fees are part of the closing costs listed on the HUD-1.

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What is a mobile notary or mobile closing?

It is common in many markets for escrow companies to provide the convenience of a mobile closing. In the days before the transaction closes, both the buyer and seller will need to sign documents. A mobile notary will meet you at your home, office, or at any location that is convenient for you, to facilitate the signing of these documents. This eliminates the need for the buyers and sellers to drive to the nearest escrow office.

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I will be out of town for the closing. How will escrow handle this?

The first solution is to appoint someone you trust as your agent or attorney, and obtain written authorization, or power of attorney for that person to sign the closing documents on your behalf. It is possible to limit power of attorney to a specified act, such as signing documents for a specific transaction. Alternatively, documents can be emailed to the buyer for signing. The originals can then be shipped overnight to the escrow team a few days prior to closing.

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Why do I need title insurance?

When purchasing a home, you want to be sure that there are no problems with the home's title and that the seller really owns the property. Problems with the title can limit your use and enjoyment of the property, and could also result in significant financial loss. A title search and title insurance will insure that the record title is subject only to the exceptions expressly set out in the policy. It also insures against certain matters which do not appear on record, such as forgery, identity of parties, incompetence of former owners, interest of missing heirs, and status of individuals who do not have the "right" to sell property.

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Do I need title insurance if I’m buying a condominium?

Yes. When you purchase a condominium, you technically do not own "land" but rather you own the "air space" inside the walls, ceiling and floor of your unit. Title insurance is available for a condominium, just as it is for a house on it's own parcel of land. To protect your interests, it is highly recommended that you purchase title insurance for your condominium unit.

A title search will be done when you are purchasing your condominium, just as it is when buying a house, and this search will reveal any defects in the title of the unit, along with any problems or liens which may occur against the condominium building or the complex itself. You will receive a deed to your own unit, plus an undivided interest in the common areas, such as the parking areas, walkways, yards, and pool. You also want to be sure that you will not be held liable for any unpaid bills or liens against the condominium association. If there are unpaid bills on the common areas, the association could prepare an affidavit stating that they have the money to pay the bill. If there is litigation regarding an unpaid bill, the association could post a bond or set the money aside for payment of that debt.

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How are title insurance premiums determined?

Title insurance premiums are determined by the amount and type of coverage provided. Unlike other insurance premiums, however, the title insurance premium is paid only once, as the policy is effective for as long as title or ownership remains in the name of the insured, his heirs or devises. Rates are filed with the insurance commissioner who regulates the activities of title insurers.

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What are the primary differences between a Standard Owner's Policy and a Home Owner's Policy?

Click here to view a policy comparison chart for specific coverage details. Please contact us if you would like to discuss specific coverage details.

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Why does my lender require me to purchase a loan title policy?

Most lenders require a loan policy when they issue you a loan. The loan policy is usually based on the dollar amount of your loan. It only protects the lender's interests in the property should a problem with the title arise. It does not protect the buyer. The policy amount decreases each year and eventually disappears as the loan is paid off.

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I'm refinancing. Why do I need title insurance?

When you refinance, you are obtaining a new loan-even if you stay with your original lender. Your lender will usually require a new title search and loan policy to protect their investment in the property. You will not need to purchase a new Owner's Policy, the one you bought at closing is good for as long as you and your heirs have an interest in the property. Even if you recently purchased or refinanced your home, there are still problems that could arise with the title. For instance, you might have incurred a mechanic’s lien from a contractor who claims he/she has not been paid. Or, for instance, you might have a judgment placed on your house due to unpaid taxes, homeowner dues, or child support. The lender needs reassurance that the title to the property they are financing is clear.

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I'm buying new construction, do I need title insurance?

Construction of a new home raises special title problems for the lender and owner. You may think that you are the first owner when constructing a home on a purchased lot. It’s entirely possible, however, that the unimproved land had several previous owners. A title search will uncover any existing liens, and a survey will determine the boundaries of the property being purchased. In addition, a builder may have failed to pay subcontractors and suppliers, which could result in the subcontractor or supplier placing a lien on your property. Again, lenders want to be sure the property has clear title, and that they are insuring the correct property. Purchasing an Owner's Policy will protect you against these potential problems and pay for any legal fees involved in defending a claim.

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How do I file a title insurance claim?

An Owner's Policy of Title Insurance is intended to provide the homeowner with peace of mind in regard to their legal rights to real property. If the homeowner has any question or concerns about his or her rights, he or she should promptly notify us at claims@nextitle.com.

If you are unable to find your policy or are unsure whether you purchased one, contact us and we'll help you locate it. You can also determine if you have title insurance coverage by reviewing the settlement statement (HUD-1) provided at the closing of your purchase, which itemizes receipts and disbursements by the closing officer. For example, charges for an Owner's Policy of Title Insurance are listed on line 1110 of the standard HUD-1 form of settlement statement.

When giving notice of a potential claim, you should include the property address, a brief statement of the question or matter that concerns you, copies of any claims documents received, and a copy of your Owner's Policy (if available).

Remember, the broad coverage of title insurance includes protection against frivolous claims, or "clouds" on title that may not present an immediate problem. It's best to contact the title insurer promptly, as soon as you have any question or concern about your legal rights with insured land.

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