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Don’t Be Surprised By Exceptions; Have Your Title Commitment Reviewed By A Real Estate Lawyer

The title commitment is one of the most important documents in a real estate transaction. However, most buyers have no idea what the title commitment means or what title insurance covers. The title commitment is a document issued by the closing attorney or title company that will be issuing title insurance to the after closing. The title commitment gives a detailed account of the ownership of, and liabilities associated with, that property, and it explains precisely what the title insurance policy will and will not cover, once it’s issued. Having your title commitment reviewed by an experienced real estate lawyer protects your interests and investment by making sure no surprises are lurking in the text of your title commitment.

Overview Of The Title Commitment

In addition to spelling out the requirements necessary to provide title insurance, the title commitment provides a detailed listed of any liens, obligations, or other burdens that may be attached to the title for the property, and limitations on the use of the property, like easements; existing leases; CC&Rs (covenants, conditions & restrictions, such as the rules of a homeowners’ association). The title commitment document addresses all of this information in three sections, called Schedules.

  • Schedule A – Schedule A contains basic information about the real property and transaction: The purchaser and mortgage lender, legal description of the property, the effective date of proposed title insurance policy, along with the type of policy, coverage amounts and current title vesting (ownership).
  • Schedule B-I – Schedule B-I lists all of the requirements that need to be met before the property title is considered marketable, and the insurance policy can be issued to the buyer (proposed insured). This might include things like the deed from seller to buyer, mortgage documentation between buyer and lender, satisfaction or release of any liens, corrective deeds from prior owners, or probate for a deceased owner.
  • Schedule B-II – Schedule B-II specifies items that the title insurance policy will not cover: The exceptions. There are standard exceptions for issues like unrecorded easements, encroachment, rights of tenants who occupy the property, and municipal liens. There may also be property-specific exceptions for things like CC&Rs, recorded easements, or agreements with utilities.

Real Estate Lawyers Help You Deal With Those Requirements and Exceptions 

An experienced real estate lawyer can help ensure you are aware of any issues in your title commitment that may delay closing and receive a title policy that best protects your interests.

Often they can also help you exercise your rights under the sales contract to require the Seller to resolve the title issues or have some of the listed exceptions covered by the title insurance policy. The real estate lawyers at Overstreet, Miles, Cumbie & Finkenbinder help buyers and sellers in Kissimmee, St. Cloud, and throughout Osceola County make fully informed choices for successful transactions. Give us a call at 407-847-5151 or contact us online to schedule a consultation and we’ll let you know how we can help you get what to expect from your real estate transaction, without unwelcome surprises.

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What Are All Of These Closing Costs? Here’s The Breakdown!

“What are my closing costs” is one of the most common questions when buying and selling real estate. While the sale contract breaks down the list of closing costs, fees, and charges for each party, it remains of the most mysterious sections of the contract. That’s because the elusive “closing costs” vary based on the sales price of the property, the type of loan you choose, and the state or county where the property is located.

Typical Closing Costs For Sellers:

  • Applicable Documentary Stamp Taxes
  • Owner’s Title Policy and Charges (depending upon contract terms)
  • Municipal Lien Search
  • HOA/Condo Estoppel Fees
  • Recording and any other fees required to provide marketable title
  • Seller’s Attorney Fees

Typical Closing Costs For Buyers:

  • Documentary Stamp & Fees On Promissory Notes
  • Recording Fees For Deed & Financing Statements
  • Owner’s Title Policy and Charges (depending upon contract terms)
  • Property Survey, if Required
  • HOA/Condo Association Transfer/Application Fees
  • Municipal Lien Search
  • Loan Costs like origination, appraisal, inspection, and credit reporting fees
  • Buyer’s Attorney Fees

Why Are Some Fees Listed Twice?

In some cases, the fees are negotiable, either in terms of who pays them, or in terms of the amount to be paid. In general, sellers pay all the fees required to remove any encumbrances on the title and their own legal costs, while buyers pay the fees associated with financing and transferring the property title. The party paying for the title insurance chooses the closing/title agent, which gives some measure of control over that cost. However, many of the fees are regulated by state law, such as title insurance premium, documentary stamp taxes, and recording costs, will not change.

Having a real estate attorney on your side can help you negotiate a more favorable result and gives you added protection against surprises, like finding a previously undetected encumbrance on the property or learning after the transaction is over that there are zoning or land use controls that prevent you from using the property the way you wanted to.

Keep Closing Costs To Your Fair Share

When you work with the real estate attorneys at Overstreet Law, P.A., you place yourself in a better position to negotiate your fair share of closing costs and can rest assured that your real estate purchase contract is not going to come back to bite you later. Call or contact us online to schedule a consultation, and we’ll let you know how we can help in your specific transaction.

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4 Advantages Of Using A Real Estate Attorney Vs. A Title Company

Unlike many other states, Florida does not require the use of an attorney during a real estate transaction. Buyers and sellers have the choice of using an attorney or a title company to handle the closing on their real estate transaction. This often causes the parties to wonder why they should hire an attorney instead of a title company to handle their closing.

In this post, we want to share with you 4 reasons why a title company is not a substitute for an experienced real estate attorney.

4 Advantages To Hiring A Real Estate Attorney For Florida Property Transactions

1. A title company works for the title insurer, not the buyer or the seller, whereas real estate attorneys work for whomever hires them. Once hired, an attorney represents that client throughout the transaction – in addition to overseeing the transaction to completion, they look out for their clients’ best interest and advocate for their client. The title company’s role is to prepare the basic closing documents required by the title insurer to complete the transaction and issue the title insurance policy.

2. Title agents do not have law degrees and cannot provide legal advice. When there are problems or questions, the buyer/seller can’t turn to the title company for help or advice. One of the most common issues that comes up is how to take title to the property, which has legal and tax ramifications. A title agent cannot provide advice in this situation, but an attorney can. Realtors as well as the buyer/seller, benefit from working with attorneys since the attorney can review the contract and answer legal questions during the contract negotiation process; title companies cannot. 

3. Title agents cannot create contract addenda, address problems in the sales contract, deal with non-standard forms, or correct legal issues that affect the title. This is important because if an issue arises, corrective documents may need to be obtained or created. Attorneys can provide legal advice on the best way to handle the issue, as well as prepare necessary documents, title agents cannot. Depending on the issue, a title agent will in fact have to send parties out to hire an attorney (at their own expense) to handle specific problems. Not having an attorney can delay the closing or even cause the transaction to fall apart entirely.

4. The costs of hiring a title company vs. an attorney are comparable. Many closing costs such as title insurance premiums, documentary stamps, and recording costs are set by the State of Florida. They are the same whether an attorney or a title agent is facilitating the process. In some cases, using an attorney can actually save the parties money by performing double duty as an attorney and a title agent; a title agent cannot do the same.

To learn more about the real estate services at Overstreet Law, P.A, contact us at 407.847.5151.

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