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