FAQ's
What is title insurance?
Title Insurance is insurance against the risks present in all real estate transactions.
What are some of those risks?
The two categories of risks are hidden hazards and human errors. Hidden hazards include forgery, unknown heirs, fraud, incompetency of the grantor, or mortagor impersonations. Human errors include filing errors of any kind.
How is title insurance different from other types of insurance?
It protects against future losses that are the result of events that have happened in the past.
How do you calculate the annual premium?
There are no annual premiums! One fee, based on the purchase price of your home or the amount of your mortgage, is paid when the policy is issued and it's good for the life of the policy!
What do you mean by "the life of the policy"?
An owner's policy is good until you sell the property. A lender's policy stays in effect until the mortgage is paid off. That's why it's always good to get an owners policy.
How does title insurance protect my home investment?
It puts the assets of a corporation behind the title of your home. If your title is attacked, it will be defended without cost to you. You will be reimbursed for any financial loss up to the face amount of your policy.
Why do I need title insurance?
When you buy a home, or any property for that matter, you expect to enjoy certain benefits from ownership. For example, you expect to be able to occupy and use the property as you wish, to be free from debts or obligations not created or agreed to by you, and to be able to freely sell or pledge your property as security for a loan. Title insurance is designed to cover these rights you bargain for.
If my lender gets title insurance for its mortgage, why do I need a separate policy for myself?
The lender's policy covers only the amount of its loan, which is usually not the full property value. In the event of an adverse claim, the lender would ordinarily not be concerned unless its loan becomes non-performing and the claim threatened the lender's ability to foreclose and recover its principal and interest. In the event of a claim there is no provision for payment of legal expenses for an uninsured party. When a loan policy is being issued, the small additional expense of an owner's policy is a bargain.
What if I have a problem? Do I have to lose my property to make a claim?
Not at all! At the mere hint of a claim adverse to your title, you should contact your title insurer or the agent who issued your policy. Title insurance includes coverage for legal expenses which may be necessary to investigate, litigate or settle an adverse claim.
What are the title insurance rates?
Title insurance rates are standard rates set by the Pennsylvania Dept. of Insurance. The sale rate applies to purchases and conveyances, and the non-sale rate applies to refinances. Epic charges nothing else!
Terms To Know
Your home is often the largest financial transaction you’ll ever make, and can be confusing and intimidating. We aim to make this process easier for you to understand, so we have put together some commonly used terms to help you.
APPRAISAL
An opinion or estimate of value of property resulting from analysis of facts about the property.
ANNUAL PERCENTAGE RATE (APR)
The borrower’s costs of the loan term expressed as a rate. This is not their interest rate.
BENEFICIARY
The recipient of benefits, often from a deed of trust; usually the lender.
CLOSING DISCLOSURE (CD)
Form designed to provide disclosures to help borrowers understand all of the costs of the transaction; given to the consumer three business days before closing.
CLOSING/SETTLEMENT
Though it varies from state-to-state, the closing is generally the final step in the sale and purchase of a property.
CONSUMMATION
Occurs when the borrower becomes contractually obligated to the creditor on the loan, not, for example, when the borrower becomes contractually obligated to a seller on a real estate transaction. The point in time when a borrower becomes contractually obligated to the creditor on the loan depends on applicable State law. Consummation is not the same as close of escrow or settlement.
DEED OF TRUST
An instrument used in many states in place of a mortgage.
DEED RESTRICTIONS
Limitations in the deed to a parcel of real property that dictate certain uses that may or may not be made of the real property.
DISBURSEMENT DATE
The date the amounts are to be disbursed to a buyer and seller in a purchase transaction or the date funds are to be paid to the borrower or a third party in a non-purchase transaction.
EARNEST MONEY DEPOSIT
A deposit or partial payment made by a purchaser of real property as evidence of good faith.
EASEMENT
A right, privilege or interest limited to a specific purpose that one party has in the land of another.
ENDORSEMENT
A rider or attachment forming a part of the title insurance policy expanding or limiting coverage.
ESCROWS/IMPOUNDS
Account established by lenders for the accumulation of borrower’s funds to meet periodic payments of taxes, mortgage insurance premiums and/or future insurance policy premiums, required to protect their security.
HAZARD INSURANCE
Insurance covering property against fire, some natural causes, vandalism, etc. Homeowner may add liability insurance and extended coverage for personal property.
LEGAL DESCRIPTION
A description of land recognized by law, based on government surveys, spelling out the exact boundaries of the entire parcel of land.
LIEN
A form of encumbrance that usually makes a specific parcel of real property the security for the payment of a debt or discharge of an obligation. (e.g. judgments, taxes, mortgages, deeds of trust.)
LOAN ESTIMATE (LE)
Form designed to provide disclosures to help borrowers understand the key features, costs and risks of the mortgage loan for which they are applying. Initial disclosure to be given to the borrower three business days after application.
MORTGAGE
The instrument by which real property is pledged as security for repayment of a loan.
PITI
A payment that includes Principal, Interest, Taxes, and Insurance.
POWER OF ATTORNEY
A written instrument whereby a principal gives authority to an agent. The agent acting under such a grant is sometimes called an Attorney-in-Fact.
RECORDING
Process of filing documents affecting real property with the appropriate government agency as a matter of public record.
SETTLEMENT STATEMENT
Document providing a detailed breakdown of costs involved in a real estate transaction.
TILA-RESPA INTEGRATED DISCLOSURE (TRID)
A rule issued by the Consumer Financial Protection Bureau (CFPB) that combines and integrates the disclosures under the Truth in Lending Act (TILA) and the Real Estate Settlement Procedures Act (RESPA). Effective October 2015.