Flashcards in Principles 10 Deck (13)
-The possession by a neutral third person of money, a written instrument, evidence of title, or another thing of value that is received from one party to a transaction for delivery to the other party to the transaction on the performance of one or more conditions at a specified time.
Close of escrow
- the escrow agent provides each party a settlement statement that itemizes all receipts and disbursements.
2 requirements for a Valid Escrow
Someone employed by an escrow company or escrow holder to handle escrow transactions.
-is the allocation of property expenses and other charges to seller or buyer.
-expenses that are prorated include: rents, taxes, insurance premiums, and interest on loans
Abstract of title
-Lists every recorded change of ownership or claim on the property being examined
-accompanied by a lawyer’s opinion of title, which comments on the present validity of any claims of lien or ownership
-assumes that the policyholder is able to inspect the property before purchase and determine how the land is being used and by whom
-covers FRIC: forgery, recording defects, improper delivery of a document of title, and incapacity of the grantor
-that is intended primarily for the benefit of lenders.
-Describes the property and names the owner of record
-indicates any outstanding taxes, bonds, and assessments
-identifies any conditions and restrictions on the property
-lists any recorded encumbrances or other items that will be exceptions to the title insurance coverage.
North vs. South
-Northern California, buyer pays for owner’s title insurance policy
-Southern California, seller pays for owner’s title insurance policy
-legal action taken taken by escrow holder to have a court determine the rights of the parties because the parties cannot agree on terms
North vs. South handling escrows
-Northern California: escrow is typically handled by the title insurance company
-Southern California: separately licensed escrow companies often are used, and financial institutions also performs many escrow