Posted by Rob FL on November 29, 2000 at 21:22:05:
An example would be if the buyer had a court judgment or federal tax lien recorded against them at the time of the sale. Depending on the law and various other things, the judgment or tax lien might be have first priority over the mortgage.
Mortgagee policy of title insurance - Posted by Brad Tx
Posted by Brad Tx on November 29, 2000 at 13:07:23:
My state’s standard purchase agreement states the following:
“SELLER FINANCING
…If an owner policy of title insurance is furnished, Buyer shall furnish Seller with a mortgagee policy of title insurance.”
How does the “mortgagee policy of title insurance” protect the seller, and what, exactly, does it protect the seller against?
Thanks,
Brad Tx
Re: Mortgagee policy of title insurance - Posted by dewCO
Posted by dewCO on November 29, 2000 at 23:02:43:
Is this an owner carry or new traditonal financing? If it’s the later, then it doesn’t protect the seller, it adds coverage to the lender. Typically the buyer pays for this and in CO it’s about $100. Don’t know about seller financed.
Re: Mortgagee policy of title insurance - Posted by JPiper
Posted by JPiper on November 29, 2000 at 20:24:25:
Rob below defines it well. I would only add that in my opinion this one is a rip-off. Think about it…the seller produces a title policy to the buyer for a fee paid by one or the other, then the buyer gives the seller back a policy for another fee, on his own property?
The Realtor approved contracts here contain the same type of language. Many times I strike out the language…because I seem to be the guy always paying for the cost.
Might be worth discussing with your attorney.
JPiper
Re: Mortgagee policy of title insurance - Posted by Rob FL
Posted by Rob FL on November 29, 2000 at 13:43:48:
If the seller is providing seller financing, then it protects them against any title claims that would be superior to their mortgage.
Re: Mortgagee policy of title insurance - Posted by AnnNC
Posted by AnnNC on November 29, 2000 at 18:58:44:
For example?
You mean like an undisclosed other mortgage? How would
that usually happen chronologically? Could the buyer encumber the property ahead of seller financing, and
how/when? Just wondering. Not sure I followed. Guess
that’s what title insurance is for. Ann