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There is a process involved when buying title insurance. It begins when you ask for the title insurance policy. It is not necessary to have a sale of property in progress or to reveal the stage of that sale.
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FLORIDATITLEINSURANCE HOW DOES THE TITLE INSURANCE PROCESS WORK? Title Insurance 101, Part 1
FLORIDATITLEINSURANCE There is a process involved when buying title insurance. It begins when you ask for the title insurance policy. It is not necessary to have a sale of property in progress or to reveal the stage of that sale. The title insurance process is an obvious seven-step procedure with several secondary steps if a problem surfaces.
FLORIDATITLEINSURANCE STEP 1: REQUEST INSURANCE Either the buyer or the attorney representing the buyer makes the request for title insurance. In return, the title insurance company will usually provide a report containing minimal information. The information shows the title as it is presently on the record, generally at the time of the last request or transfer of the property. STEP 2: SEARCH OF THE RECORDS A title researcher locates three records: name, tax and property information. This information forms the basis of a preliminary report by the title researcher who can expedite retrieval of hard copies. Because of the availability of online records of title, the image of those records serves to expedite the search.
FLORIDATITLEINSURANCE STEP 3: EXAMINATION OF THE TITLE The title researcher has both skill and expertise in providing an accurate report of the property title history. This report begins with an in-depth analysis of all documents on record. An interpretative analysis evaluates information on record and the impact of that information on the property title. STEP 4: ISSUANCE OF THE BINDER The binder is a commitment to insure a title on the subject property. It specifically targets items such as the amount of coverage, parties to coverage, policy terms and conditions as well as the limitations of coverage. Reading the limitations will disclose any “clouds” on the title, which could impact the completion of a sale or refinance.
FLORIDATITLEINSURANCE STEP 5: EXPOSING HIDDEN DEFECTS A cloud on a title is a hidden defect that a previous search did not reveal. Recent occurrence under the present owner could also cause a cloud to appear. Unpaid betterments, encroachments, incorrect surveys, foreclosure attempts or events, taxes outstanding and improvements that do not meet code are some of the clouds that might surface from a binder. STEP 6: CLOUD CLEANING When the binder exposes the clouds, the investigation into their origin can commence. It is important to determine when and where the instance(s) began before any cleaning can begin. Addressing unpaid judgments with both buyer and seller is a high priority. Once the clouds lift (or stay), a decision is forthcoming for the process to continue or die.
FLORIDATITLEINSURANCE STEP 7: PREMIUM PAYMENT AT CLOSING Issuance of a title insurance policy requires a one- time only premium payment. The buyer or mortgage borrower pays this at the time of closing. It remains in effect for the lifetime of ownership by that buyer. At the same time, the lender receives the actual title insurance policy. If the buyer purchases a policy, the closing attorney generally delivers it. The lender’s policy goes directly to the lender and a copy of the lender policy becomes part of the title of record. Sources: https://artesiantitle.com/ https://info.courthousedirect.com/
