Category Archives: Title Tip of the Week

Know Your Title Commitment: Schedule B: Section 1

Posted on July 21, 2020 | Leave a comment

“Ordering Title” is not like ordering pizza. Each one is as unique as the property they are issued for.

The Title Commitment can seem intimidating, but it should not be. Two of the most informative parts of the Title Commitment can be found in Schedule B. We will cover Section 1 this week, Section 2 next week.

Schedule B, Section 1 is the Requirements Section. This outlines what must be done prior to closing for a title to be issued.  You will find there:

– Taxes

– Recording a release

– Recording a new deed

– Recording loan documents

– Recording a court order evidencing the authority for one person to act on another’s behalf (POA)

– Copy of a trust, corporation or LLC paperwork

– Release of liens

– Proof of ID

It is not uncommon for a closing to be delayed as efforts are made to find items in the requirements section. “Requirements” are just that. Without satisfying all of them, no policy can be issued.

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Foreclosure? Time is of the Essence

Posted on July 15, 2020 | Leave a comment

Do you have a potential listing that may be heading in to foreclosure? Don’t automatically get scared away, there still might be a chance to sell.

If the seller has any paperwork or other notifications related to a foreclosure, send it to us to review. If there is a case number for the foreclosure, we can pull up the docket and see the status of the case. If a Summary Final Judgment has been entered, there is a only a little time close on the sale (35-60 days from date of Judgement) and the property will be sold at a foreclosure sale.

As a final note, a Short Sale entered in to negotiation usually does not stop the foreclosure process.

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How to Spot a Possible Probate Issue

Posted on June 30, 2020 | Leave a comment

When someone dies with title to property in that person’s name only, a probate is required to drop the title to the beneficiaries.

Look at the names of the owners on the tax roles and the last deed of record, if possible, before your listing appointment. Do these differ from the person you are meeting with? If so, you should ask questions about why.

Frequently, children will try to sell their parent’s home without completing the probate. Ask if the probate has been done or if a probate attorney is working on it. The title commitment will reflect the true ownership status. However, you do not want to have the wrong people sign the contract then wait months for closing or not have a closing at all.

One final twist. For Florida property, you need a Florida probate. Out of state probates will not work.

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No One Likes a Surprise Spouse

Posted on June 24, 2020 | Leave a comment

If someone is married, their spouse’s signature is required to sell or mortgage a homestead property. This is not a Title or Mortgage requirement per se – it is required as per Article X, Section 4 of the Florida Constitution.

When it comes to marriage, there are three other situations come up on a regular basis that can inject some “surprise” in the closing process:

– In Florida, marriage is a “yes” or “no” situation. The is no “separated” or “common law spouse” recognition.

– A seller is technically married but are not in contact with their spouse – sometimes for years – or are estranged to the point where communication is difficult.

– A divorce is pending, and the timing is close to the closing – or not discovered until the last minute.

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Church Sale? Take a Deep Breath

Posted on June 9, 2020 | Leave a comment

Selling a church can be a challenging and complicated transaction. In a variety of ways, they are quite different from a commercial or residential transaction. To add to the complexity, there are a lot of different twists and turns that can make each church sale different from another.

Important things to find out up front:

– Incorporated or unincorporated?

– Representative or congregational form of government?

– Written by-laws, Board of Directors/Trustees?

– Is the pastor the authorized administrative person, or someone else?

– Are there special requirements for conveying title?

Those are just a few questions to start the process towards closing. Expect a few surprises along the way, especially once the Title Commitment comes in.

Each church sale is unique.

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Mail Away? If All Else Fails, Follow the Directions

Posted on May 27, 2020 | Leave a comment

In response to COVID-19, we’ve seen a slight uptick in “mail aways.” Buyer and seller mail aways are a normal part of the process and can be transparent to the transaction timeline as long as they are planned for early. Two things are essential for success; following directions and proper notarization.

Every mail away we send will include detailed directions of what needs to be signed and what needs to be notarized, with critical areas highlighted. Whenever possible, we will also give verbal instructions. We keep a copy of every package we send, so if needed, we will happily go over it with buyers and sellers when they receive it to help clarify questions they may have. The directions included in the mail away, if followed, will make sure everything will flow well and no delays will take place.

Especially going out of state, following Florida notary requirements is essential. Not all states have the same requirements and most notaries know this, but some may not. Make sure out of state notaries read and follow the instructions, even if they say they are familiar with Florida requirements.

Most buyers and sellers prefer to choose their own notary, but if they need help, we will be more than happy to assist them in finding one. Just let us know!

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Who Holds Your Binder Matters

Posted on May 14, 2020 | Leave a comment

confused-money-counterAs you’re finalizing your contract, make sure your customers know what can happen if there is a binder dispute.

The best place to hold a binder is with a real estate brokerage. If there is a binder dispute, as described in the NEFAR Purchase and Sale Agreement lines 276-278, “…the broker holding the binder deposit(s) may request the issuance of an Escrow Disbursement Order from the Florida Division of Real Estate.”

That is the most efficient and least confrontational way to resolve a binder dispute. If a binder is not held there, it will have to be held by a settlement services provider – a title company or attorney.

If the binder is held by an attorney or title company and there is a binder dispute, then the only option is interpleader. An interpleader involves lawyers, courts, and judges.

Look at lines 275-276, “…the interpleader’s attorney’s fees and costs shall be deducted and paid from the binder deposit(s)…”

The last three interpleaders we’ve seen had legal costs between $1,000-$1,500. It can go higher. That is taken right out of the binder. This is one of the reasons we recommend a strong binder of at least $3,000. That way, there is actually something worth fighting over, in this case the remaining $1,500-$2,000 after legal fees, at best.

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What is “gap” coverage?

Posted on May 7, 2020 | Leave a comment

mind-the-gapOn occasion people are concerned that something may affect Title between the day the Title Commitment first arrives and the closing date, AKA “the gap.”

For example, during the gap, the property could be sold or mortgaged or a lien could be asserted on the property. That is why for closings a title insurance commitment is updated to the exact time of the closing in order that the title policy issued will neither be obsolete nor contain any unanticipated problems for the parties involved that may have come up during the gap period.

There’s no reason for a buyer to be concerned; they’re covered.

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Surveys: Always a Good Idea

Posted on April 15, 2020 | Leave a comment

1-GolfExisting or new, there is a reason lenders require surveys. They want to make sure that they are making a smart business decision when they write a loan. Though not required for a cash closing, wouldn’t buyers want to make sure they a making a smart business decision when they buy?

We see a lot of people waiving surveys for vacant land and home sales. Buyers should be careful trying to save a few hundred dollars with investments well in to the hundreds of thousands of dollars.

Just because a fence has been there for 50 years, does not mean that is where the property line is. That deck, driveway, or dock may not be part of the subject property, even though to the eye it clearly is.

That well-manicured half acre? The seller may only own a third of it.

Have a careful discussion with any buyer willing to waive a survey – no one needs to live that dangerously.

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Plan Right for the International Buyer

Posted on March 5, 2020 | Leave a comment

12737094-money-and-calculatorDo you have a non‐USA citizen buyer? No worries, there are just a few things you need to keep in mind.

1. No reason to be concerned with FIRPTA (Foreign Investment in Real Property Tax Act of 1980), that only applies with a foreign seller.

2. Identification. A US Government Issued ID or their passport is all they need.

3. Money. It has to be United States Dollars. If they are bringing a certified check, it needs to be from a USA banking institution.

If you are unsure, ask us if the bank your buyer is using qualifies. If your buyer is planning to wire funds from a foreign bank overseas, make sure you ask us for our “International Wiring Instructions.” Unlike wire transfers coming from inside the USA, international wires can take from 3 to 7 working days before they are available for closing. The best plan is to have them use a US bank and have their funds transferred early on so it is ready at closing day.

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