Frequently Asked Questions
What is title insurance?
Owner's title insurance protects purchasers of real estate against title defects that may exist on the property.
Lender’s or (Mortgagee) title insurance insures the lender as to the priority of its lien, meaning there are no other mortgages, liens or judgments that have priority over their mortgage.
What is a title search?
A title search is a detailed examination of the historical records concerning a property. These records include deeds, court records, property and name indexes, and many other documents. The purpose of the search is to verify the seller’s right to transfer ownership, and to discover any claims, defects and other rights or burdens on the property.
Who pays for title insurance?
In Florida it varies per county and can be negotiated in the contract. The seller generally pays for the title insurance and chooses the title/closing company in most Florida counties. The buyer generally pays for title insurance and chooses the title/closing company in the following counties; Sarasota, Collier, Miami Dade and Broward. Request a free, no obligation title insurance rate quote now by clicking here.
How much can a title company charge for Florida title insurance?
Florida title insurance rates are set by the Florida Department of Insurance. A Florida title insurance owner's policy and a Florida title insurance lender policy are generally issued simultaneously, with the policy of lesser value having only a nominal premium rate. The scale of Florida title insurance rate premiums is as follows based on the insurance amount:
- Up to $100,000 a rate of $5.57 per $1,000 of insurance;
- Over $100,000 up to $1 Million a rate of $5.00 per $1,000 of insurance;
- Over $1 Million up to $5 Million, a rate of $2.50 per $1,000 of insurance;
- Over $5 Million up to $10 Million, a rate of $2.25 per $1,000 of insurance;
- Over $10 Million, a rate of 2.00 per $1,000 of insurance
What does title insurance protect against?
- False impersonation of the true owner of the property
- Forged deeds, releases or wills
- Undisclosed or missing heirs
- Instruments executed under invalid or expired power of attorney
- Mistakes in recording legal documents
- Misinterpretations of wills
- Deeds by persons of unsound mind
- Deeds by minors
- Deeds by persons supposedly single, but in fact married
- Liens for unpaid estate inheritance, income or gift taxes
What is an Escrow Deposit?
An Escrow Deposit, also known as an Earnest Money Deposit, is money that a homebuyer puts down as a sign of good faith when purchasing a home.
What is Escrow?
Escrow is a process that provides for a fair and equitable transfer of property from one person to another.
Escrow opens when the buyer and seller sign a sales contract, commonly called a Real Estate Purchase Agreement and a deposit is paid. The contract, along with any additional instructions, serves as instructions for the escrow officer in terms of accounting for Escrow and release of Escrow funds.
Escrow assures that the lender releases the home purchase funds at or about the same time that the deed is recorded to reflect new ownership. Escrow includes depositing, with a neutral third party, funds, documents and instructions necessary to complete the transfer.
How long do the funds stay in escrow?
The amount of time necessary to complete the escrow is determined by the terms of the Real Estate Purchase Agreement or the time taken to process your loan. It is normally 45 to 60 days, but can range from a few days to several months.
What is FIRPTA?
The Foreign Investment in Real Property Tax Act, better known as FIRPTA, 26 U.S.C. § 1445, provides that a buyer must withhold 15% of the amount realized by the foreign seller in the sale of an interest in U.S. real property. If the seller is a foreign person and the buyer fails to withhold, the buyer may be held liable for the tax.
Where can I get more information on FIRPTA?
We would be glad to answer any questions that you might have on FIRPTA, but additional information, applicable forms, the withholding certificate application process and more can be found on the Internal Revenue Service (IRS) or by clicking here.