TITLE AND TITLE PROTECTION
- State Recording Acts are essential to title protection.
- Recording: entering into public record.
- Constructive Notice: is notice that is deemed to be given because the facts are readily available.
- Actual Notice: when one knows a fact concerning a property through direct knowledge or when notice is expressly given.
- Acknowledgement: a formal declaration made by person singing the document the he is indeed singing as a free and voluntary act. Taken by:
- County Clerk
Bona Fide Purchaser
- A party who has paid value for an estate in real property without actual constructive notice of an already existing estate in the same parcel.
Title Insurance Defined
- Title Insurance: a contractof indemnity under which a title insurance company, for a one time payment agrees to indemnify the insured.
- Title company also defends any lawsuite attacking the title which is based on a defect covered by the policy.
- Total policy coverage diminishes as damage payments are made to the insured.
- Exclusions: those matters that the policy expressly indicates are not within the coverage provided. (Condemnation...)
- Exceptions: relate to matters that were never intended to be the subject of title insurance.
- They are matters that the title company cannot insure because the constitute objections to the title.
Examination of Title Records Prior to Purchase
- Abstract of Title: condensed historical records of all grants affecting the property.
- Cahin of Title: attempts to trace an unbroken chain of former owners back fro 60 years.
Undiscovered or Hidden Defects
- An owner's title insurance policy insures title against loss from both undiscovered and undiscoverable defects.
Run-Down Search / Continuation
- conducted to reveal any matters of record which have occurred between the time of the initial search and the closing of title.
Action to Quiet Title
- Legal action necessary to clarify the status of title and remove any clouds on the title.
Examination of Title
- Examination of Title: process of reviewing the info discovered in a search or abstract by those who will prepare a Committment (title report and binder).
- Issuance of a committement is based on the results of the title search, judgement search, and tax assessment search.
- Outlines terms and conditions.
- Terminates nine months from its effective date or the closing of title, which ever occurs first.
Uniform and Ununiform Provisions
- Uniform: same policy by policy.
- Ununiform: differ from policy to policy.
Title Insurance Coverage
- Title to the insured land is in the name of the insured.
- Any defect in or lien or encumbrance on the title.
- Protection against loss arising from lack of right of access to the property.
- Marketability: title that if free of defects and and liens.
FORMS OF TITLE INSURANCE
- Owner's (Fee) Policy:
- Mortgage or Loan Policy
Affidavits of Title
- Representations made by the seller and buyer.
- The right to take legal action against a third party responsible for a loss to an insured for which a claim has been paid.
- Endorsement: a written statement that is used to modify the contents and coverages of a title insurance policy or committment.
The New Jeersey Department of Banking and Insurance
- Regulates policy forms and endorsements as well as premiums and charges.