Title Insurance vs Title Search

General Real Estate Investing
1
  • What is the difference between Title Insurance and a Title search.
  • When you pruchase a home Sub2 or another creative way what do you have to tell the Title company to do so they can check if there are any leins or loans against the property.

:biggrin Thanks for the help!!
Rich

2

Hey RJ,

A title search makes sure the seller can legally sell the property,
if there are any liens on the property, and if the property has any
restrictions or easements.

Title Insurance protects the buyer (owner’s policy) and lender (lender’s policy)
from any title problems that were missed during the title search.

The title company will probably require you to get a title policy if they
are going to close for you. Request only an owner’s policy because the
mortgage isn’t being refinanced. :cool

After you come to an agreement with the seller simply deliver the
Purchase and Sale agreement to the title company and they’ll have
you sign paperwork for the title work and closing and set a preliminary
closing date.

Since you’re closing subject to, tell the title agent early on.
They will want to have you and the seller sign several disclosers showing you
both are aware of the Due on Sale/Transfer and that the mortgage is
remaining in the seller’s name. The title insurance policy rates are mandated
by the state, but it’s not much and really worth it.

3

I’m curious to know if a bank has ever enforced the due on sale/transfer clause on a sub 2 deal?

JP