CH 7 - Escrows and Title Insurance
ALTA
-The most all inclusive title insurance policy -Requires a property survey and is usually required by most lenders -Would cover most of the exclusions of a standar policy
Requirements of a valid escrow
1. Signed instructions 2. Neutral third party 3. Conditional delivery Officer does NOT have to be licensed
Escrow sequence of events
1.2.3.?? Lender's demand (amount owed on property), Request of new loan requirements, Adjustments and prorations 4. Recording and issuing of title policy
The base period escrow companies use when calculating proations
30 days
RESPA
A federal statute requiring disclosure of certain costs in the sale of residential property
Title Plant
A filing of all recorded information to real property
Chain of Title
A history of conveyances and encumbrances affecting the title from the time the original patent was granted, or as far back as records are available, used to determine how title came to be vested in current owner
Pest Control Report
A report from a structural pest control company stating the termite or other type of pest damage found and the cost of repairing it
Preliminary Title Report
A report showing the condition of title before a sale or loan transaction
Proration
Adjustments of interest, taxes, and insurance, etc., on a prorated basis as of the closing or agreed upon date
When a trust deed is sold, the parties use an escrow (agent) in order to
Assure conditions are met
Who selects the escrow company?
Buyer and seller
Title Insurance
Insurance to protect a real property owner or lender up to a specified amount against certain types of loss ex. Defective or Unmarketable title
Things that have Recurring charge(s)
Property tax fees
Date of Closing
The date documents are recorded and title insurance is written
CLTA
The minimum standard title insurance poly in California that does NOT require a property survey
Mutual consent of the parties
The only way that escrow instructions can be changed, once they have been drawn and signed by each party
Escrow Officer
The person at the escrow company who handles the paperwork of theescrow
Escrow
The process of depositing instruments, funds, and instructions, with a 3rd neutral party who finalizes the transaction
Coinsurance
The requirement by a lender that a property be insured up to its full value, or only a proportion of any loss will be reimbursed
Escrow Instruction
The written instructions of the escrow, prepared by the escrow officier and approved by both the buyer and the seller
Things that are a One-time fee
Title Insurance fees Escrow fees Country Recording fees
Payoff Demand Statement
Written instructions by a lender stating and demanding the amount necessary to pay off a loan
The decision to assume an existing fire insurance policy or buy a new one is made by the
buyer
The California Standard Form Fire Insurance Poly insures your property against
fire, lightning NOT windstorm