Buying or Selling a Home Made Easy

With any major sale or purchase, knowledge is power. The more you know about each aspect of the process, both in general and with regards to the specific home in question, the more confident you can be that you are taking the appropriate steps as you buy or sell a house.  At Northwest Title, we are committed to helping our clients come to the closing table with the confidence that they have been informed throughout the process. We have compiled resources in order to educate those visiting our site. In order to talk to a real estate expert for specific questions, call us today at 866-601-8449.

What is title insurance?

Title insurance protects against financial loss that would result from the discovery of a previously unknown defect to the title. A previous mortgage or lien, a forged document, an undisclosed heir, or any number of other issues that cannot be discovered by a title search can disrupt the ownership of a piece of land or a home.
 

What is a title search?

A title search examines the historical records of a plot of land. The search allows parties to a transaction to be fully aware of any and all interests that apply to that land.
 

When should I buy title insurance?

Title insurance is an integral part of real estate transactions because it protects all the parties involved from the losses and inconvenience that can result from the discovery of title defects. It is purchased as part of the closing, and is a one-time premium.  Your policy protects you for the duration of your ownership.
 

How much does title insurance cost?

In most states, the rate premium for title insurance is regulated by the State's Department of Insurance. That means that the premium you will pay will be the same throughout the state for each type of policy. 
In other states, the title insurance underwriters file their rates with the State, and there might be small differences in the premium cost, depending on the underwriting company. 

 

Does the title insurance agency handle the closing?

Yes, your title agency helps you navigate the closing process. From managing the title and mortgage lending documents, conducting the closing, to handling the receipt and disbursement of all the funds in a transaction, a good title partner can help streamline the process for all parties involved.
 

  • BUYING A HOME
  • SELLING A HOME
When buying a house, you should become as educated as possible about the house itself and the neighborhood in which it is located. How conveniently located are such amenities as grocery stores, hospitals, childcare, highways and public transportation? How long will your commute be?
 
With regards to the house itself, make sure to check the structure itself and all appliances to make sure that everything is stable and in good working order. Make sure to view the house both from the interior and exterior. The US Department of Housing and Urban Development has put this helpful checklist for homebuyers as they narrow their search.
 
Make sure to compile the appropriate paystubs any other information necessary in order to secure your loan and to shop around for the best rate.
 
On the day of the closing, make sure to bring all the appropriate documents. A valid driver license or passport, a cashier’s check for any down payment and copies of your homeowner’s insurance are generally the required items for a buyer to bring. Your closing agent will typically be the person coordinating the close—feel free to contact them with any questions you have prior to the close.
Before you sell your home, do what you can to increase the salability of the home. Consider making small fixes or renovations that would push up the selling price. When the time comes to begin showing the house, tidy up the inside and manicure the outside to make the home as appealing as possible. Depending on the age of your house, having a professional perform an inspection could be a good idea in order to discover and fix any issues that might be discovered when the buyers have their own inspection performed.
 
Research your neighborhood and the home prices of homes similar to yours. If you are confident, set your own price, or employ the services of a certified appraiser. You must also choose whether you want to have a real estate agent act on your behalf or sell the house yourself. A real estate agent will take care of many of the miscellaneous issues that arise during the sale of a home and share their sales and real estate expertise, but they do charge a commission for their services. You must also decide whether you’d like to engage a lawyer, who can help you draft any paperwork and who can be on call in the event of any unexpected circumstances. For more information about real estate law services, feel free to visit the Holfinger Law Office website.
 
After the offer, counteroffer, and any other negotiations over home repairs, the time for the closing arrives. Make sure to maintain the house in good condition and to notify the appropriate utilities companies to the date when services should be cut off.

Glossary

Abstract [ Of Title ] – A history of all transactions shown in the public records affecting a particular tract of land. 
Acceleration Clause – A provision in a promissory note that specifies conditions under which the lender may advance the time when the entire debt which is secured by the mortgage becomes due. 
Acknowledgment – A formal declaration before an authorized officer [ usually a notary public ] by a person who has signed an instrument that such signing is the individual’s act. 
Adjustable Rate Mortgage [ ARM ] – Mortgage loans under which the interest rate is periodically adjusted, in accordance with some market indicator, to more closely coincide with the current rates. 
Administrator – A person appointed by a court to take possession of the property of a person who died without leaving a will, to pay debts and to distribute the property to those entitled to it according to law. 
Adverse Possession – The possession, by one party, of land belonging to another in a manner deemed adverse to the interest of the record owner. 
Affiant – One who swears to or affirms the statement in an affidavit. 
Affidavit – A written statement made under oath before a notary public or other judicial officer. 
ALTA – (American Land Title Association) – The trade association of the title insurance industry, which has adopted certain insurance policy forms to standardize coverage on a national basis. 
Appurtenance – A right or privilege that is attached to another property and is conveyed with it. See also easement and encroachment. 
Assessed Valuation – The valuation placed upon land for purposes of taxation. 
Assessment – The valuation of real estate for the purpose of taxes or special improvement charges. Special improvement charges are usually for the costs of streets, sidewalks, sewers, etc. 
Assignment – The act of transferring certain interests in real estate from one party to another, like a mortgage or leasehold interest. 
Assumption of Mortgage – An obligation undertaken by a new purchaser of land to be liable for payment of an existing note secured by a mortgage. 
Attorney – in-fact – A person who holds a power of attorney from another to execute specified documents on behalf of the seller of the power.
Back Title Letter ( also called “back title certificate” or “starter”) – When titles previously have been examined up to a certain date by reliable examiners, title companies sometimes give subsequent examiners of such titles a letter that sets forth the condition of the title at the time of the previous examination and authorizes them to begin their subsequent examination with the terminal date of the previous examination. 
Beneficiary [ Of Trust ] – A person designated to receive benefits from a trust estate. 
Building Codes – Local or state laws that control accepted building and construction practices. 
Building Lines ( also called “setback lines”) – Lines fixed at a specific distance from the from of sides of a lot or at a certain distance from a road or street. No building on the lot may project outside the area defined by the building lines.
Claim – An adverse right or interest asserted by one party against another or against an insurer or indemnitor. 
Closing Costs – Miscellaneous expenses involved in closing a real estate transaction over and above the price of land.
Deed – An instrument for conveying real estate. 
Deed of Trust – A form of security instrument for mortgage loans. 
Defect – An imperfection of deficiency. 
Draw – Disbursement of a portion of the mortgage loan.
Earnest Money – A deposit of funds made by a buyer of real estate as evidence of good faith. 
Easement – A non-possessory right to use all or part of the land owned by another for a specific purpose. See also appurtenance and encroachment. 
Encroachment – Any building, improvement, or structure (such as a wall, fence, or driveway) located on one property that intrudes upon the property of another. See also appurtenance and encroachment. 
Encumbrance – Any interest, right , lien, or liability attached to a parcel of land (such as unpaid taxed or an unsatisfied mortgage) that constitutes or represents a burden upon the property. 
Endorsement – A form issued by the insurer at the request of the insured which changes terms or items in an issued title insurance policy of commitment. 
Examination – The study of the instruments and muniments to a chain of title in order to reach a conclusion as to the status of the title. 
Exception – A provision added to Schedule B of a title insurance binder or policy to limit the liability of the insurer for a specific title defect of an outstanding lien of encumbrance. 
Exclusion – Those general matters affecting title to real property excluded from coverage in the Exclusions from Coverage of a title insurance policy. 
Execute – To sign a legal instrument. A deed is said to be executed when it is signed, sealed, witnessed, and delivered.
General Warranty Deed – A deed containing a covenant by the seller to protect the buyer against being dispossessed due to adverse claims against the land. 
Good Faith Estimate – The Real Estate Settlement Procedures Act (RESPA) requires creditors to provide a good faith estimate of closing costs and a settlement statement listing the amounts paid by the consumer. If the creditor does not know the precise credit terms, the creditor must base the disclosures on the best information reasonably available and indicate that the disclosures are estimates. 
Grantee – The buyer, or one to whom the property is transferred. 
Grantor – The seller, or one who transfers property to another. 
Guaranty Policy – A title insurance policy that insures only against defects of title appearing in the public records.
Homeowner’s Insurance – Real estate insurance protection against loss caused by fire, some natural causes, vandalism, etc. depending on the terms of the policy. Also includes coverage such as personal liability and theft away from home.
Indemnify – To protect, hold harmless against loss. 
Insured Closing Service – An agreement by the title insured to indemnify the insured for any loss in settlement funds caused by (1) the failure of the company’s policy issuing agents or approved attorneys to conform to closing instructions of the insured , or (2) fraud or dishonesty of the issuing agent or approved attorney.
Junior Mortgage – A mortgage lower in lien priority than another, for example, a second mortgage or home equity line.
Lien – A monetary charge imposed on a property, usually arising from some debt or obligation. 
Loan Policy – (also called “mortgage policy”)- A title insurance policy insuring a mortgagee, or beneficiary under a deed or trust, against loss caused by invalidity or unenforceability of a lien, or loss of priority of the mortgage or deed of trust.
Marketable Title – A title which a reasonable purchaser, well informed as to the facts and their legal meaning, would be willing to accept. 
Metes and Bounds – A land description in which boundaries are described by courses, directions, distances and monuments. 
Mortgage – A conditioned pledge of property to a creditor as security for the payment of a debt. 
Mortgagee – The holder of a mortgage. 
Mortgagor – A person who gives a mortgage on his or her property to secure an obligation, usually the repayment of a debt.
Owner’s Policy – A title insurance policy insuring an owner of real estate against loss occasioned by defects or unmarketability of the owner’s title.
Plat (of survey) – A map dividing a parcel of land into lots, as in a subdivision. 
Power of Attorney – A written instrument by which one person authorizes another, the attorney-in-fact, to act on his or her behalf.
Quieting Title – The removal of a cloud on title by property action in a court. 
Quitclaim Deed – A transfer of interest the transferor may hove in the thing conveyed.
Recording – The noting in a public office of the details of a legal document, such as a deed or mortgage, affecting the title to real estate. 
Reissue Rate – A reduced rate of title insurance premium where the owner of the land has been previously insured by an owner’s policy by the insurer within a certain time. 
RESPA – The real Estate Settlement Procedures Act (12 U.S.C. 2601) that, together with Regulation X promulgated pursuant to the Act, regulates real estate transfers involving a “federally-related mortgage loan” by requiring, among other things, certain disclosures to borrowers.
Secondary Market – A market system for the purchase and sale of mortgage loans, often gathered into pools and traded as mortgage-backed securities. 
Senior Lien or Mortgage – If there is more than one lien on land, those liens are ranked by priority. A senior lien or mortgage is entitled to be paid first in foreclosure or bankruptcy, before a junior lien. 
Settlement Funds – All of the money, from the buyer, the buyer’s lender of any other source, that is necessary to meet all obligations created in a real estate transaction. 
Simultaneous Issue – An owner’s policy and a mortgage policy issued by a title insurer on the same interest at the same time.
Title – A combination of all the elements that constitute the highest legal right to own, posses, use, control, enjoy, and dispose of real estate or an inheritable right or interest therein. 
Title Defect – Any possible or patent claim or right outstanding in a chain or title that is adverse to the claim of ownership. 
Title Insurance Policy – A contract of title insurance under which the insurer, in keeping with the terms of the policy, agrees to indemnify the insured against loss arising from claims against the insured interest. 
Title Search – A review of all recorded documents in the land records relating to a particular piece of real property to determine the present condition of title. 
Truth-In-Lending – The federal Truth in Lending Act, 15 U.S.C. Sec./1601, et. Seq., governs the disclosure of information related to certain consumer financial transactions and requires those in the lending business to make the disclosures to their individual borrowers.
Underwriter – An insurance company that issues insurance policies to the public or to another insurer.