CAN I GET A PRELIMINARY CLOSING DISCLOSURE (CD)?
Yes. Under the new regulations you are required to have a Closing Disclosure 3 days prior to the closing.
WHAT DOCUMENTS SHOULD I BRING WITH ME TO CLOSING?
What you bring to closing depends on what your role is in the closing. In general, the buyer or borrower needs to bring photo ID, certified funds, any documents that the lender requests they submit at the time of closing, and an original POA if applicable. The seller needs to bring a photo ID, termite letter, original POA (if applicable), keys and garage door opener, and any specific items requested by the attorney’s office or their agent. To see our complete buyers and sellers’ checklists, please click here.
HOW MUCH MONEY SHOULD I BRING TO CLOSING?
Your lender, broker, or agent can usually give you an estimated amount to bring to closing, and the Closing Disclosure will give you the amount you should bring. You may want to obtain your funds in an amount in excess of what you are expecting. The closing attorney can refund the excess funds if necessary.
SHOULD I PROVIDE CERTIFIED FUNDS?
Our firm requires certified funds for any amount over $1,000. Please have the funds made out to Royal Title Company at closing. You may also wire your funds directly to us. Check with our closing team for the details.
SHOULD I PURCHASE OWNERS TITLE INSURANCE?
Attorneys and other real estate professionals recommend that buyers purchase owner’s title insurance. An owner’s title insurance policy protects the property owner against loss from title defects and claims against their property due to unforeseen or undisclosed issues. Although Royal will do an expert title examination to insure a “good title,” there are many undetectable title issues that can cause financial loss and heartache. Some of these issues include:
- Documents recorded during the time period between title examination and closing (lenders and attorneys will often refer to this as “the gap”).
- Unrecorded documents that may give other individuals or entities an interest in the property.
- Forged deeds, mortgages, satisfactions, or releases.
- Deed from an unauthorized individual under corporate resolution, partnership agreement, or trust agreement.
- Liens filed by contractors or vendors who have not been paid for services provided to the property.
- Undisclosed divorce status.
- Ineffective release of prior satisfied mortgage due to bankruptcy of creditor prior to recording of release.
- Invalid or fraudulent probate of wills and estates.
- Mistakes in public records.
Title claims pose a great risk to property owners. If a title claim is valid, the buyer risks expenses and actual loss, up to and including loss of the entire property and all equity in it while still having to pay back a loan on the property. If the claim turns out to be invalid, the buyer still has to pay out of pocket to defend the claim or to rid the property of a cloud on its title. On the other hand, buyers who purchase the owner’s title insurance have a title company behind them that has the obligation whenever coverage exists to pay the costs and fees incurred to defend the property owner and to pay any losses that ultimately occur. Owner’s title insurance is a buyer’s option, but most real estate professionals will recommend this one-time premium as an important protection for a valuable investment.
An owner’s policy does not cover anything existing against the buyer when he or she takes title, such as federal tax liens or other judgments, nor does it protect against anything that may attach to the property through the buyer after the buyer takes title.
WHAT IS THE DIFFERENCE BETWEEN OWNER’S AND LENDER’S TITLE INSURANCE?
When a buyer is purchasing property through a loan, the lender will require that closing costs include a lender’s title insurance policy or a policy that protects the lender’s interest in the property. The lender’s title insurance policy DOES NOT protect the buyer if a title issue arises. The buyer remains at risk of loss and costs associated with the title issue unless the purchaser is an insured party under an owner’s title insurance policy.