What is a title?
When you purchase a home, you are really purchasing the title to the property—which is the right to occupy and use the space. That title may be contested based upon past rights and claims asserted by others. These types of claims can infringe upon your purchase of the property or cause you to lose money.
What is a title search?
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.
What kinds of problems can a title search reveal?
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
What is title insurance?
Title insurance is a policy used by homebuyers and lenders for protection against back taxes, undisclosed liens, legal judgments, forgeries, fraud and a host of other potential legal/financial problems that can arise when purchasing or refinancing property.
Do I need Title Insurance?
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, such as a forged deed, that even the most careful title search will not reveal. In addition to protect you from financial loss, title insurance pays the cost of defending any covered claim.
How does title insurance protect my investment if a claim should arise?
If a claim is made against your property, title insurance will, in accordance with the terms of your policy, assure you of a legal defense—and pay all court costs and related fees. Also, if the claim proves valid, you will be reimbursed for your actual loss up to the face amount of the policy.
How much does title insurance cost?
Probably a lot less than you think. Charges vary in different sections of the country, but in Florida cost of title insurance (including search, examination and related services) amounts to about one percent or less of the cost of the property. And unlike other insurance premiums, which must be paid annually, a title insurance premium is paid one time only, usually at settlement.
Since the lender already requires Title Insurance, won’t that protect me?
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.
The contract I signed makes the sale subject to title to the property’s being good. Doesn’t that protect me?
If anything should happen to defeat the Florida title, your cause of action would be against the seller, and his ability to pay. Attorney’s fees and expenses would not be covered.
How much does Title Insurance cost?
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.
Can Best Title Company handle my closing?
Yes. We collect all the necessary documentation – assuring adherence to the lender’s title instructions, making arrangements for payment and distribution of funds. Best Title Company is geared up to work with you from the start of your transaction all the way through to conclusion.
Who pays for which expenses at closing?
Closing costs are determined by the terms of your contract for the purchase and sale of the property. Customarily, but not always, the closing costs are divided between the buyer and seller, as follows*:
The Buyer pays:
- Recording Fees – varies by county
- State Documentary Stamp Tax – varies by county
- Intangible Tax – varies by county
- Owner’s Title Insurance Policy- based on the sales price.
- *(However, the custom in Palm Beach County is that the Seller pays for the title insurance)
- Lender’s Title Insurance Policy
- Refinances – Variable, depending on production of Prior Owner’s Title Insurance Policy
- Endorsements to Lender’s Policy
- Express Mail – If applicable, charged to the appropriate party.
The Seller pays:
- State Documentary Stamp Tax for Deed of Conveyance – varies by county
- Owner’s Title Insurance Policy – Based on the sales price **In Palm Beach County**
- Taxes – Current year’s real estate taxes are prorated as closing
- Title Search, Exam and Closing Fee – Approximately $550.00
- * Prices are subject to change without notice
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