I've never heard of anyone saying ,
"I'm going to go home and snuggle by the fire and read a good insurance policy"!
Many people don't understand Title Insurance; almost everyone in the Real Estate Industry would say it's important.......and it's boring.
It's true! I've seen people nearly fall asleep in a Title Insurance class more than once!
It's just about as uninteresting as watching paint dry or reading any insurance policy, however, I cannot stress enough the importance of READING the Title Commitment (or Preliminary Report) nevertheless.
When I reviewed the last title commitment I received, I found the buyer's name was misspelled, the county in the legal description was incorrect and some requirements and exceptions needed to be removed.
Agents, buyers, sellers and lenders receive a Title Commitment (or Binder or Preliminary Title Report depending on your part of the Country) that sets out, among other things:
1. WHO WILL BE INSURED UNDER THE POLICY/POLICIES: The buyer and the lender
Verify that the buyers' names are spelled correctly. This is important because most often the name on the title work will also be the name on the Deed.
2. THE PROPERTY LEGAL DESCRIPTION: The property that is being purchased and/or mortgaged
Verify that the legal description of the property is correct and check the property address, too.
3. THE REQUIREMENTS necessary to issue the final policy:
Check the requirements to be sure there aren't any unusual items, unexpected liens to be released or correction deed requirements from previous owners. Usually the closing office, attorney's in some states, or Escrow Company prepares the documents necessary to meet the requirements.
4. THE EXCEPTIONS (the things not covered under the policy).
You need to read this too!! This particular commitment cited an easement and a right of way that weren't even on the property.
If there is an easement crossing the property, the buyer should know about it; what kind of an easement is it? Where is it located? Who does it benefit? AND if that easement is not on the property it should be removed.
Copies of all the exception documents should be included, so you can read and review them. Read all of the exceptions, and especially read all of the Covenants, Conditions and Restrictions.
Buyers, if you have any questions regarding your Title Insurance Commitment or Preliminary Title Report, please call your agent, the Title Company or your Attorney. It's so important for every Real Estate Agent to review the title commitment or preliminary report as well, check it for obvious errors and accuracy.
Just read it! Doggone it, I know it's boring - but it's important.
Mary Douglas, your Mountain Broker-Associate and REALTOR®
United Country Ponderosa Realty, Red Feather Lakes, CO
www.redfeatherlakes.com ---800-531-2195
"A Day in the Mountains will always soothe your city soul"
The information contained in Mary's blog is deemed reliable but is not guaranteed, and the opinions and views expressed in these articles are solely those of the author.
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avoid foreclosure: call the Colorado Foreclosure Hotline 1-877-601-HOPE
HOTLINE WEBSITE: ColoradoForeclosureHotline.org
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