August Events Calendars

San Diego Events Calendar – August 2013
Orange County Events Calendar – August 2013

Concurrent Closings

What is a Concurrent Closing?
A Concurrent Closing is the term used to define two or more properties dependent on each other to close. For example, the first property funds and records and the proceeds from that transaction are used to fund or partially fund the second transaction. Sometimes concurrent recordings exist in which the second transaction is not dependent on funds from the first transaction. In this case, the two record back to back without any delay.

Do you have to use the same Title and Escrow Companies on all transactions?
No, you don’t, although it can make things easier. The normal procedure on a single transaction is to fund the new loan, record the documents and then send the proceeds via wire or check to the escrow company. When a concurrent closing is involved, time is of the essence. If both transactions use the same title and escrow companies then no money needs to move locations. If different title and escrow companies are used, then those companies need to communicate with each other. At the close of the first transaction, escrow instructs their title company to forward funds directly into the second transaction. This process saves valuable time by avoiding the process of wires being transferred back and forth between two Escrows and two Title Companies. Once the second title company verifies receipt of the funds, they can go ahead with their transaction.

What is the key to a successful transaction?
Communication is the key. At California Title Company, our goal is to help you succeed. By communicating your needs to your escrow and title companies, all parties involved can work together to ensure a successful close.

This information is deemed reliable, but not guaranteed.

July Events Calendars

San Diego Events Calendar – July 2013
Orange County Events Calendar – July 2013

Be Aware When You Are Dealing with a Seller & a Bankruptcy

A Judgment Lien Appearing on Your Prelim May Not Have Been Removed

Common Situation Explained:
A situation that arises fairly often when a title company is requested to insure a transaction is where an Abstract of Judgment has been recorded against the seller and the seller has subsequently received a discharge of the debt in bankruptcy. Unfortunately, the discharge of the debt itself does not eliminate the lien of the recorded Abstract. Once the Abstract has been recorded, the judgment lien can only be eliminated by a separate Bankruptcy court order known as an “Order Avoiding Lien”.
 
Although the bankruptcy discharge may have relieved the debtor of personal liability, it does not eliminate the judgment lien. In other words, even though the creditor can no longer satisfy the judgment by attaching the debtor’s wages or other assets, a judgment lien that arose prior to the bankruptcy can still be enforced against the real property, even if it has been sold or transferred to a third party. For this reason, a title company will not “insure over” the lien without either a proper Order Avoiding Lien from the Bankruptcy Court or a release of the lien by the judgment creditor.
 
However, once the debtor has received a discharge in bankruptcy, the judgment lien will not attach to any property that the debtor acquires after the date of the discharge. In that case, the judgment lien may not be a concern to the title company.
 
If you are dealing with a seller who has had a bankruptcy, contact California Title Company for information on what’s needed to close on their specific property.

This information is deemed reliable, but not guaranteed.
 
Legal counsel should be consulted for advice in specific situations.

How to File a Title Insurance Claim

WHAT SHOULD I INCLUDE?

Statement of the Claim: Include a brief, specific explanation of your insurance claim.

Property Information: Include the full property address (this is required to begin a review of any claim request).  If the street address is not available, please include the legal description or the Assessors Parcel Number of the property in question.

Claimant Contact Information: In order for the underwriter to respond to your claim request, please include your name, address, telephone number and email address, if available.

Supporting Documents: Please include a copy of the title insurance policy, copy of the final settlement statement or HUD 1, copies of supporting documents that you feel support your claim request.

 
WHERE SHOULD I SEND THE CLAIM?

Review the portion of your policy stating “How to Make a Claim.”  Submit the above information to the underwriter as mentioned in your title policy and address your claim to the Claims Department. Send your request through certified mail so that you can document and track the status of your claim.

Your claim will be handled by the claims department and may not be handled through a local title insurance branch. All questions should be directed to the claims department.

This information is deemed reliable, but not guaranteed.

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Why Does My Transaction Require Two Title Policies?

Nearly every sale of a residential property involves the purchase of two policies of title insurance, an Owner’s Policy and a Lender’s Policy.
 
FOR THE SELLER
The purchase of a home may prove to be the largest single financial investment many people may make in their lifetime. Your buyer will want to make sure that the property is indeed yours to sell and that no one else has any lien, claim or encumbrance on your property. An Owners Policy, typically paid for by the seller, insures that you have right to pass clear title on to the buyer, as well as protects them against certain issues that may arise after the close of escrow.
 
FOR THE BUYER
For most of us, buying a home requires help with financing the purchase price. Your home loan is secured by the new home you are buying. Your lender will want to know that the property they are involved with is insured against certain title defects and that you are the owner of record. The Lender’s Policy of title insurance, typically paid for by the buyer, insures your lender, and any purchasers or assigns of the loan, that their lien has priority over other liens not shown in the policy. Many lenders condition their loans upon the purchase of a Lender’s Policy.
 
REAL ESTATE CUSTOM & PRACTICE
With title insurance there are no continuing premiums due, as there are with other types of insurance. The seller pays a one-time premium for the new buyer’s Owner’s Policy based on the sales price of the property. California Title will search and examine the public land records to identify and eliminate any title risks. The new buyer’s Owner’s Policy indemnifies the buyer against loss and provides a defense in the event of claims against the title pursuant to the terms of the policy. For a one-time charge, the buyer’s Owner’s Policy protects the buyer for as long as the buyer owns the property.  With a Homeowners Policy, the buyer is protected even after they sell the property.
 
The buyer will be responsible for paying the title insurance premium for the lender’s policy on their home loan. The premium is calculated based on the loan amount, not the sales price of the property. Because the seller is providing an Owner’s Policy, California Title can give a concurrent rate which results in a significant savings on the Lender’s Policy. Title insurance gives the buyer, seller and lender peace of mind by protecting the security of the home and the safety of the investment.

This information is deemed reliable, but not guaranteed.

Why Lenders Require Title Insurance When Refinancing Your Home

Lower interest rates have motivated you to refinance your home loan. The lower rate may save you a tremendous amount of money over the life of the loan, but you should also expect to pay the lender the typical closing costs associated with any new loan, including service fees, points, title insurance protection and other expenses.

Why do I need to purchase a new title insurance policy on a refinanced loan? To the lender, a refinance loan is no different than any other home loan. So, your lender will want to insure that its new loan is protected by title insurance, just as the original lender required. Therefore, when you refinance you are buying a title policy to protect your lender.
Why does a Lender need title insurance? Most lenders generate loans and then immediately sell those loans to secondary market investors, such as FannieMae. FannieMae, in order to protect its security interest in the loan, requires title insurance coverage. Even those lenders who keep original loans in their portfolio are wise to get a lender’s policy to protect its investment against title related defects.

When I purchased my home, didn’t I also buy a lender’s policy? Perhaps. Who pays for the lender’s policy on a purchase loan varies regionally and by the terms of individual contracts. However, even if you did buy a lender’s policy when you purchased your home, the lender’s policy remains in force only during the life of the loan that was insured. If you refinance, the old loan is paid off ( the “life” of the loan expires) and a new loan is issued for with the lender will require a new title insurance policy.

What about my original title insurance policy? When you bought your home, you purchased a homeowner’s title policy. The homeowner’s policy stays in force as long as you or your heirs own the home. When you refinance, your lender will often require that you purchase a new lender’s policy to protect its new security interest in the property. Thus, you are buying a policy to protect your lender, not a new homeowner’s policy.

What could possibly have happened since I purchased my home which warrants a new lender’s policy? Since the time that the original loan was made, you may have taken out a second trust deed on the house or had mechanic’s liens, child support liens or legal judgments recorded against you – events that could result in serious financial losses to an unprotected lender. Regardless if it has been only 6 months or less since you purchased or refinanced your home, a myriad of title defects could have occurred. While you may not have any title defects, many homeowners do. The only way for a lender to adequately protect itself is to get a new lender’s policy each time you purchase or refinance your home.

This information is deemed reliable, but not guaranteed.

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Inspections Vs. Surveys

What is an Inspection and how is it different from a survey?
An inspection is a general review of the property from the stand point of issuing a policy of Title Insurance. Title Insurers will send an inspector to check for a number of things, such as: recent construction, address and property type verification, parties in possession, and similar characteristics of the property. In addition they will check for any apparent encroachments of improvements and easements. 

A survey is done by a licensed surveyor with the sole purpose of locating property lines. The surveyor uses specific equipment, maps and other recorded surveys to establish benchmarks in regards to property lines, thus identifying boundaries and potential encroachments.

When do I need an inspection?
If you’re selling your property or buying a new property and the title insurer needs a visual representation of the property, an inspection will be ordered. In some cases, inspectors may,at their discretion, meet with buyers to go over their findings. In addition, anything the
inspector visually sees that may alter the value of the property would need to be shared with the title insurer.

When do I need a survey?
When you need to know an exact measurement of your property or an identification of property lines, a survey is your best option. Many times adding a pool, landscape or additional square footage requires you to know where your property boundaries are. A surveyor is licensed and bonded and will give you a survey map identifying boundaries and property lines.

This information is deemed reliable, but not guaranteed.