At What Point To You Get Title Insurance?
I guess the thitle of the post really asks the question. I am buying a REO with cash from another investor. Do I get the title insurance before or after the sale? how does that work?
[addsig]
Maybe there's a terminology issue here.
and REO is a property that when thru forclosure, and is now owned by the lender.
Was the investor the lender?
Title insure "insures" that there are no defects of title, such as tax/state/federal liens, judgements and ensures clear title.
If you buy the property, and then get insurance, you might find out there is for issue w/ the title.
There have been several recent posts title "defects" that surface after COE.
I have always TI s part of the escrow.
Lenders frequently require it.
OK it wasan REO, a wholesaler bought it and is flipping it to me. How long does it take to do the search? I mean do I just buy the insurance and then go buy the property? or do I have to wait for the title company to come back and say ok the title is good? Oh and I am not financing it I am paying cash. I just don't want to get stuck when I go to resell it that there are problems with the title
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If you do what you have always done, you will get what you have always gotten. Success can't occur whithout taking risks, just be sure to take calculated, informed risks![ Edited by joefm26 on Date 06/05/2004 ]
I don't know the procedure there, but here you open escrow w/ an escrow officer, title company or attorney.
Part of that process will be a prelim title report which will list defects if any.
then you can make your choice to buy or not, or to ask for a price cut.
During the escrow period, there will do they will draft the formal, you pay out of escrow, w/ other fees, loan, docs and escrow closed.
you own, he gets $$
Is this your 1st purchase? You don't have an attorney or broker?
Omigosh.... how can you even contemplate buying real estate without title insurance?
Bring your contract for sale (reviewed by an attorney or someone you can blame if it self destructs) to a title company. They'll run a title search and let you know if they'll insure the title.
Gotta have it.
[addsig]
Any standard, rudimentary real estate contract generally requires that good and merchantible title be conveyed to you the purchaser. As one of these conditions (other than the Deed--In your state it would be a General Warranty Deed) you would have the SELLER furnish you at his expense (also customary in your state--I've done beaucoup of deals in your state) with Title Insurance in the amount of the purchase price.
in my state, you get the insurance binder at the time of settlement and should receive your policy within a week or so (that usually doesn't happen because they are so backed up but once the previous liens are released and they have recording info for your purchase & possible mortgage, the policy should be issued - bug them and you'll get yours - there is no reason to wait up to a year until they get around to it). if there are any title issues, you should be sure to tell them up front you want to know about them immediately and that you will decide if they are to be excepted from the policy or if you want them cleared up. remember, a seller in most instances has agreed to give you good & marketable title so there is no reason not to enforce that clause because your end buyer will probably require it from you.
I saw a previous post from CA and I believe they do things out there differently than most of the country with their 'escrow' procedure.
in PA, for a cash deal, you sign an Agreement of Sale, order a title work and then go to settlement. at settlement, you sign documents, pass the money and get your keys and go on your merry way.
who does settlement in PA?
OK so let me understand this, when I put in an offer on a house, once the offer is accepted, then at that point the title search is done. Or I have to do the title search before I put in an offer?
Oh and to shortsalepro- I am not considering buying without title insurance. This is my first cash deal which is why I am asking questions. If I wasn't going to do any title work I problab ywouldn't have asked the question in the first place.
Thanks
[addsig]
"Or I have to do the title search before I put in an offer?"
Your 'offer' should be subject to good and marketable title insurable by a reputable title insuring agency.
When and if the offer is accepted, you begin your due diligence including, but not limited to investigating the title.
Thanks thats what I needed to know
Joe
[addsig]
cjmazur, in PA, you can either go through a title company or an attorney. For the extra $150 more than the title company that he charges, there is no way I wouldn't have my lawyer sign his name on the dotted line. we settle everyone in the room at the same time, seller, buyer, both realtors, seller's atty, buyer's atty, mtg broker if he's local & wants his check right away. Paperwork is passed, money is passed and keys & garage door openers are passed. when you walk out of the room it's a done deal (of course all this is in a situation with no problems).