Frequently Asked Questions (FAQ)

A title is an owner's right(s) to possess and use a property.

There are two types of title insurance, Lender Title Insurance and Owners Title Insurance.

Lenders Title Insurance - this is typically required by the lender in the form of a Loan Policy, which protects the lender's interest in the property, should a problem with the title arise. The policy amount decreases commensurate with the loan.

Owner's Title Insurance is usually issued in the amount of the real estate purchase. It is purchased at the time of closing for a one-off fee and lasts for as long as you or your heirs have an interest in the property. Owner's Title Insurance fully protects the buyer should a problem arise with the title that was not uncovered during the title search.

The Title Company will search the public land records for matters relating to the specific title. That search may go back as far as 50 years. Title problems such as deeds, wills and trusts that contain incorrect information, outstanding judgments or tax liens against the property or easements are identified. The Title Company fixes these problems and issues the Title Insurance.

In Pennsylvania, title insurance is not legally required for purchasing real estate. However, almost all lenders will require that you purchase a title policy.

A standard title policy insures the owner and the lender from any financial loss resulting from the following:

1. title being vested in someone other then the seller
2. any defect in, lien against or encumbrance on the title
3. unmarketability of the title
4. lack of pedestrian access to and from the land

This coverage does not cover the five standard exclusions, or any specific encumbrances or easements which are recorded against the property. The five standard exclusions are as follows:

1. Any title claim known to the buyer but not yet recorded as of the date of the policy:
2. Any title claim which was self-imposed or created by the buyer
3. Any loss resulting from zoning violations or subsequent zoning changes
4. any subsequent loss resulting from state action (condemnation or eminent domain proceedings)
5. Any condition which would have been disclosed by an ALTA as-built survey

Exceptions from coverage will also include matters which are recorded against the property, including utility easements, roadways, railroad rights, restrictive covenants and if applicable homeowner use restrictions. Also excepted from coverage is environmental contamination of the property and future property tax increases.

In Pennsylvania, title insurance rates are set by the state. The amount of title insurance is based on the greater of the purchase price or the loan amount.

Construction of a new home raises special title problems for the lender and owner. You may think you are the first owner when constructing a home on a purchased lot. However, there were most likely many prior owners of the unimproved land. A title search will uncover any existing liens and a survey will determine the boundaries of the property being purchased. In addition, builders routinely fail to pay subcontractors and suppliers. This could result in the subcontractor or supplier placing a lien on your property. Again, lenders want to be sure the property has clear title, and they are insuring the correct property. Purchasing owner's title insurance will protect you against these potential problems and pay for any legal fees involved in defending a claim.

Closing or "settlement" is the completion of the real estate transaction. During the closing, both the legal and financial components of the transaction are finalized, the legal documents are signed and delivered and the financial accounting between the parties is completed.

Typically settlement takes less than one hour for a sale (2 parties) and 30 minutes for a refinance.

If the settlement involves a transfer of ownership (a typical sale), the buyers(s), seller(s), and real estate agents will attend. The lender does not usually attend and forwards their documentation and instructions to the title company. WLT provides the Settlement Officer.

If the settlement is a refinance, the borrower(s) and WLT Settlement Officer are in attendance.

The HUD is also known now as the ALTA settlement statement for the title company- closing disclosure for the lender.

The US Department of Housing and Urban Development (HUD) Settlement Statement. The settlement statement is a form used by the settlement agent to itemize all charges imposed upon the buyer and seller for a real estate transaction. It gives each party a complete list of their incoming and outgoing funds. Fees associated with the transaction but paid prior to closing are also included.

As the buyer, you need to provide the following at settlement:

1. Driver's license or other government issued form of Photo Identification
2. Homeowners Insurance Policy
3. Any additional conditions required by Mortgage Co.
4. Termite report – if required
5. Cashier's or Bank Check

As the seller, you need to provide the following at settlement:

1. Driver's license or other government issued form of Photo Identification
2. Estate or Trust Documents, if applicable
3. Check to make sure that Mortgage payoffs, taxes etc. have been or will be provided to Title Company
4. Please notify the Title Company of any legal name changes due to marriage, divorce, etc.

Title Insurance is not just something you have to purchase when you are buying or refinancing real estate. Title insurance is just a part of the service that Whitford Land Transfer (WLT) provides to its customers.

In order for a WLT to provide an insurance policy to an insured we first need to search the title to the real estate. Although the public in general assumes that this process merely requires the push of a button it is in reality a very complicated process. It involves a search through public records for all matters affecting that title and correcting any problems that may exist. The myriad of governmental records and the condition in which much of the data is kept makes the title search process very difficult. It takes many years of training and experience for Title Examiner to become truly competent in his or her expertise. This is just one of many reasons why most attorneys will contact a title company to answer and solve real estate problems.

At closing or settlement, WLT provides the Settlement Officer. WLT prepares the HUD-1 Settlement Sheet and collects and disburses all funds associated with the settlement. All executed documents are forwarded to the relevant parties.

After the settlement, WLT will audit the settlement sheet and review all documents, return appropriate documents to the lender, record the deed, mortgage and other documents with the county, disburse funds and issue the title insurance policy.