Phrases in Title Insurance to Know

We’ve gathered a few terms in Title Insurance that would be of interest if you find yourself in the market for this sort of protection.

Clear Title is a title that has no defects that could encumber an owner’s right to enjoy their property, and retain all portions of it.

Cloud is when there exists a reason to believe there may be a claim in the future against the title of your property.

Earnest Money is usually required from the buyer in order to show their sincerity in entering the contract to purchase the property.

Easements the right to use the real property of another for a specific purpose, the legal title and underlying land is still retained by the owner, but the land is being used by another.

Good Faith Estimate is something that provides an estimate of your settlement costs and loan terms.

Loan Estimate is a form that details information about the mortgage loan you requested, this includes the loan amount, the interest rate being offered, your monthly mortgage payment, and if there will be a penalty if you pre-pay the loan.

Primary Title Services include evaluating the title searching records, clearing underwriting obstacles, determining insurability, preparing and issuing the title commitment and title insurance policy, charges for this are included in the title insurance premium.

Property Encroachment is when one person’s property extends onto another person’s property, is inclusive of fences, bushes, sheds, and more.

Simple Escrow is a closing in which no title insurance is issued.

Title Defects are considered competing or adversarial interests in a property’s ownership that are usually found on evaluation of the documents within the title search.

Truth in Lending Act (TILA) is a federal law in the United States used to promote the informed use of consumer credit and requires disclosures about its terms and cost to standardize the manner in which borrowing costs are calculated and disclosed.

Write of Interpleader is a court order that directs a title company on how to disburse the escrowed funds.

If you’re interested in learning more about Title insurance or obtaining a policy Gables Title Group is more than happy to help you step into your real estate transaction.