Home : F.A.Q.
What is title insurance?
Title insurance is insurance that protects a person from losses that arise from unknown or undisclosed defects in the chain of title ownership. A defect on the title is generally referred to as a "cloud" on title. Unlike other property & casualty lines of business insurance (auto, home, etc.), title insurance insures against past events, not future events. In exchange for a one time premium paid at closing, title insurance companies assume the risk that the title to a parcel of real estate is as it is stated to be in the title insurance policy. That policy indemnifies a buyer or lender against losses suffered if the clouds on title are not as the policy stated it to be.
These are some things that consumers should know about title insurance and title agents. If you are buying, selling, or refinancing property, these may be useful to you.
- Consumers may shop for title insurers for the best closing fees. Typically the seller's realtor (listing agent) will select the title agency, but consumers should talk with their realtor or an attorney regarding this title agency choice. Consumers should be aware that realtors or lenders may have ownership interests in the title agency (called "affiliated business arrangements" or "joint ventures").
- The rate premium for title insurance is regulated by the Ohio Department of Insurance. That means that the premium you will pay shall be the same throughout the state for each type of policy. The only differences in costs between title agencies are the various fees that are charged for the closing-related services.
- The title agency is responsible for conducting the title examination, conducting the closing, paying off prior mortgages or liens, paying the seller their proceeds, recording the mortgage and deed, preparing a title insurance policy, just to name a few.
- For more questions, please call us anytime at 614-944-5751, you can click on the graphic below to goto another site with more information, and you can browse the glossary of real estate terms below for more information.
Glossary of real estate terms |
||||||||||||||||||||||
|
||||||||||||||||||||||
| A | ||||||||||||||||||||||
Abstract [ Of Title ] - A history of all transactions shown in the public records affecting a particular tract of land. |
||||||||||||||||||||||
Acceleration Clause - A provision in a promissory note that specifies conditions under which the lender may advance the time when the entire debt which is secured by the mortgage becomes due. |
||||||||||||||||||||||
Acknowledgment - A formal declaration before an authorized officer [ usually a notary public ] by a person who has signed an instrument that such signing is the individual's act. |
||||||||||||||||||||||
Adjustable Rate Mortgage [ RAM ] - Mortgage loans under which the interest rate is periodically adjusted, in accordance with some market indicator, to more closely coincide with the current rates. |
||||||||||||||||||||||
Administrator - A person appointed by a court to take possession of the property of a person who died without leaving a will, to pay debts and to distribute the property to those entitled to it according to law. |
||||||||||||||||||||||
Adverse Possession - The possession, by one party, of land belonging to another in a manner deemed adverse to the interest of the record owner. |
||||||||||||||||||||||
| Affiant - One who swears to or affirms the statement in an affidavit. | ||||||||||||||||||||||
| Affidavit - A written statement made under oath before a notary public or other judicial officer. | ||||||||||||||||||||||
| ALTA- (American Land Title Association) -The trade association of the title insurance industry, which has adopted certain insurance policy forms to standardize coverage on a national basis. | ||||||||||||||||||||||
| Appurtenance - A right or privilege that is attached to another property and is conveyed with it. See also easement and encroachment. | ||||||||||||||||||||||
| Assessed Valuation - The valuation placed upon land for purposes of taxation. | ||||||||||||||||||||||
| Assessment - The valuation of real estate for the purpose of taxes or special improvement charges. Special improvement charges are usually for the costs of streets, sidewalks, sewers, etc. | ||||||||||||||||||||||
| Assignment - The act of transferring certain interests in real estate from one party to another, like a mortgage or leasehold interest. | ||||||||||||||||||||||
| Assumption of Mortgage - An obligation undertaken by a new purchaser of land to be liable for payment of an existing note secured by a mortgage. | ||||||||||||||||||||||
| Attorney - in-fact- A person who holds a power of attorney from another to execute specified documents on behalf of the seller of the power. | ||||||||||||||||||||||
| B | ||||||||||||||||||||||
Back Title Letter ( also called “back title certificate” or “starter”) – When titles previously have been examined up to a certain date by reliable examiners, title companies sometimes give subsequent examiners of such titles a letter that sets forth the condition of the title at the time of the previous examination and authorizes them to begin their subsequent examination with the terminal date of the previous examination. |
||||||||||||||||||||||
| Beneficiary [ Of Trust ] - A person designated to receive benefits from a trust estate. | ||||||||||||||||||||||
| Building Codes - Local or state laws that control accepted building and construction practices. | ||||||||||||||||||||||
Building Lines ( also called “setback lines”) – Lines fixed at a specific distance from the from of sides of a lot or at a certain distance from a road or street. No building on the lot may project outside the area defined by the building lines. |
||||||||||||||||||||||
| C | ||||||||||||||||||||||
| Claim - An adverse right or interest asserted by one party against another or against an insurer or indemnitor. | ||||||||||||||||||||||
| Closing Costs - Miscellaneous expenses involved in closing a real estate transaction over and above the price of land. | ||||||||||||||||||||||
| D | ||||||||||||||||||||||
| Deed - An instrument for conveying real estate. | ||||||||||||||||||||||
| Deed of Trust - A form of security instrument for mortgage loans. | ||||||||||||||||||||||
| Defect- An imperfection of deficiency. | ||||||||||||||||||||||
| Draw- Disbursement of a portion of the mortgage loan. | ||||||||||||||||||||||
| E | ||||||||||||||||||||||
| Earnest Money - A deposit of funds made by a buyer of real estate as evidence of good faith. | ||||||||||||||||||||||
Easement - A non-possessory right to use all or part of the land owned by another for a specific purpose. See also appurtenance and encroachment. |
||||||||||||||||||||||
Encroachment - Any building, improvement, or structure (such as a wall, fence, or driveway) located on one property that intrudes upon the property of another. See also appurtenance and encroachment. |
||||||||||||||||||||||
Encumbrance - Any interest, right , lien, or liability attached to a parcel of land (such as unpaid taxed or an unsatisfied mortgage) that constitutes or represents a burden upon the property. |
||||||||||||||||||||||
Endorsement - A form issued by the insurer at the request of the insured which changes terms or items in an issued title insurance policy of commitment. |
||||||||||||||||||||||
Examination - The study of the instruments and muniments to a chain of title in order to reach a conclusion as to the status of the title. |
||||||||||||||||||||||
Exception - A provision added to Schedule B of a title insurance binder or policy to limit the liability of the insurer for a specific title defect of an outstanding lien of encumbrance. |
||||||||||||||||||||||
Exclusion - Those general matters affecting title to real property excluded from coverage in the Exclusions from Coverage of a title insurance policy. |
||||||||||||||||||||||
Execute - To sign a legal instrument. A deed is said to be executed when it is signed, sealed, witnessed, and delivered. |
||||||||||||||||||||||
| G | ||||||||||||||||||||||
General Warranty Deed - A deed containing a covenant by the seller to protect the buyer against being dispossessed due to adverse claims against the land. |
||||||||||||||||||||||
Good Faith Estimate - The Real Estate Settlement Procedures Act (RESPA) requires creditors to provide a good faith estimate of closing costs and a settlement statement listing the amounts paid by the consumer. If the creditor does not know the precise credit terms, the creditor must base the disclosures on the best information reasonably available and indicate that the disclosures are estimates. |
||||||||||||||||||||||
Grantee - The buyer, or one to whom the property is transferred. |
||||||||||||||||||||||
Grantor - The seller, or one who transfers property to another. |
||||||||||||||||||||||
Guaranty Policy - A title insurance policy that insures only against defects of title appearing in the public records. |
||||||||||||||||||||||
| H | ||||||||||||||||||||||
Homeowner’s Insurance - Real estate insurance protection against loss caused by fire, some natural causes, vandalism, etc. depending on the terms of the policy. Also includes coverage such as personal liability and theft away from home. |
||||||||||||||||||||||
| I | ||||||||||||||||||||||
Indemnify - To protect, hold harmless against loss. |
||||||||||||||||||||||
Insured Closing Service - An agreement by the title insured to indemnify the insured for any loss in settlement funds caused by (1) the failure of the company’s policy issuing agents or approved attorneys to conform to closing instructions of the insured , or (2) fraud or dishonesty of the issuing agent or approved attorney. |
||||||||||||||||||||||
| J | ||||||||||||||||||||||
Junior Mortgage - A mortgage lower in lien priority than another, for example, a second mortgage or home equity line. |
||||||||||||||||||||||
| L | ||||||||||||||||||||||
Lien - A monetary charge imposed on a property, usually arising from some debt or obligation. |
||||||||||||||||||||||
Loan Policy - (also called “mortgage policy”)- A title insurance policy insuring a mortgagee, or beneficiary under a deed or trust, against loss caused by invalidity or unenforceability of a lien, or loss of priority of the mortgage or deed of trust. |
||||||||||||||||||||||
| M | ||||||||||||||||||||||
Marketable Title - A title which a reasonable purchaser, well informed as to the facts and their legal meaning, would be willing to accept. |
||||||||||||||||||||||
Metes and Bounds - A land description in which boundaries are described by courses, directions, distances and monuments. |
||||||||||||||||||||||
Mortgage - A conditioned pledge of property to a creditor as security for the payment of a debt. |
||||||||||||||||||||||
| Mortgagee - The holder of a mortgage. | ||||||||||||||||||||||
Mortgagor - A person who gives a mortgage on his or her property to secure an obligation, usually the repayment of a debt. |
||||||||||||||||||||||
| O | ||||||||||||||||||||||
Owner’s Policy - A title insurance policy insuring an owner of real estate against loss occasioned by defects or unmarketability of the owner’s title. |
||||||||||||||||||||||
| P | ||||||||||||||||||||||
Plat (of survey) - A map dividing a parcel of land into lots, as in a subdivision. |
||||||||||||||||||||||
Power of Attorney - A written instrument by which one person authorizes another, the attorney-in-fact, to act on his or her behalf. |
||||||||||||||||||||||
| Q | ||||||||||||||||||||||
Quieting Title - The removal of a cloud on title by property action in a court. |
||||||||||||||||||||||
Quitclaim Deed - A transfer of interest the transferor may hove in the thing conveyed. |
||||||||||||||||||||||
| R | ||||||||||||||||||||||
| Recording - The noting in a public office of the details of a legal document, such as a deed or mortgage, affecting the title to real estate. | ||||||||||||||||||||||
Reissue Rate - A reduced rate of title insurance premium where the owner of the land has been previously insured by an owner’s policy by the insurer within a certain time. |
||||||||||||||||||||||
RESPA - The real Estate Settlement Procedures Act (12 U.S.C. 2601) that, together with Regulation X promulgated pursuant to the Act, regulates real estate transfers involving a “federally-related mortgage loan” by requiring, among other things, certain disclosures to borrowers. |
||||||||||||||||||||||
| S | ||||||||||||||||||||||
Secondary Market - A market system for the purchase and sale of mortgage loans, often gathered into pools and traded as mortgage-backed securities. |
||||||||||||||||||||||
Senior Lien or Mortgage - If there is more than one lien on land, those liens are ranked by priority. A senior lien or mortgage is entitled to be paid first in foreclosure or bankruptcy, before a junior lien. |
||||||||||||||||||||||
Settlement Funds - All of the money, from the buyer, the buyer’s lender of any other source, that is necessary to meet all obligations created in a real estate transaction. |
||||||||||||||||||||||
Simultaneous Issue - An owner’s policy and a mortgage policy issued by a title insurer on the same interest at the same time. |
||||||||||||||||||||||
| T | ||||||||||||||||||||||
Title - A combination of all the elements that constitute the highest legal right to own, posses, use, control, enjoy, and dispose of real estate or an inheritable right or interest therein. |
||||||||||||||||||||||
Title Defect - Any possible or patent claim or right outstanding in a chain or title that is adverse to the claim of ownership. |
||||||||||||||||||||||
Title Insurance Policy - A contract of title insurance under which the insurer, in keeping with the terms of the policy, agrees to indemnify the insured against loss arising from claims against the insured interest. |
||||||||||||||||||||||
Title Search - A review of all recorded documents in the land records relating to a particular piece of real property to determine the present condition of title. |
||||||||||||||||||||||
Truth-In-Lending - The federal Truth in Lending Act, 15 U.S.C. Sec./1601, et. Seq., governs the disclosure of information related to certain consumer financial transactions and requires those in the lending business to make the disclosures to their individual borrowers. |
||||||||||||||||||||||
| U | ||||||||||||||||||||||
Underwriter - An insurance company that issues insurance policies to the public or to another insurer. |