THE INTERIM BINDER

If you are already familiar with the interim binder,

then you know the money-saving advantage that can be gained from its use.

this may be a very valuable piece of literature.

It cannot be used in every real estate transaction, but it can be used more often than you think.

A. It allows the purchaser of real property to resell the same property and have a policy of title issued at a

fraction of the cost.

A. The standard term is three years. However, the binder may be extended for another 365 days for an

additional 15% of the basic insurance rate.

A. In each case the cost will, of course vary. But this is the formula: The original seller pays the basic

policy fee. You, as the buyer, pay an additional 10% of the scheduled insurance rate for the binder.

At the time you sell the property, you merely pay the difference in the title premium between the cost

of the property to you, and what you'll sell it for.

Example:

Mr. Seller sells his property for $80,000.00. Mr. Broker, knowing that this is going to be a short term

investment for his buyer, requests an Interim Binder before the close of escrow. The escrow closes and the charges are as follows:

Mr. Seller pays a policy fee of $532.00, his normal charge. Mr. Buyer pays $55.20 or 10% of the basic rate for the binder. One year and eleven months later, Mr. Broker finds a buyer for the property which is now worth $100,000.00. The new seller now reaps the benefit of the binder he purchased when he bought the property. He now pays only the increased insurance amount necessary to cover the increased price of the property.

Example: Using basic rate figures: $630.00 - 552.00 = $78.00

The total cost for an owner's policy of title insurance is $78.00, plus the 10% or $55.20 he paid up front when he bought the property, a total of $133.20 as compared to $504.00 the normal short term rate fee for a home valued at $100,000.00. You have just saved your client $370.80.

Suddenly Mr. Broker, you are a hero to your client! $502.00 -133.20 = $370.80

One other point that should be mentioned is that if your client intends to hold the property for up to four years he can, before the end of the first thee years extend the already active binder for an additional year for only 15%.

*The next time you make a sale, ASK "how long do you intend to keep this property?" If the answer is less than three years, suggest the INTERIM BINDER and point out the savings. Who knows, it just might get you the listing when your client is ready to sell again.

Have a transaction to open?  We handle National Escrow & Title!  Specify Luis Echevarria and Alliance Title!  And thanks for your support! EMAIL ME YOUR ORDER AT: openorders@luisechevarria.com

LUIS ECHEVARRIA

title & Escrow Consultant - 866-606-0533 x221