Title Reports: The Basics (Professional Fiduciaries Association of California newsletter – Q1, 2015)
Working with fiduciaries and their attorneys to borrow on behalf of trusts and estates is no small matter, with complex probate, national and local real property finance lending laws. The intricacies of dealing with title companies and the three types of title reports are key to the process.
Property Profiles that a title company provides typically disclose property characteristics, current vesting, a tax report, sale comparables and the deeds of record (grant, quit and trust). Each property has three ways of identification, all of which appear in a complete property profile: common address, legal description and assessor’s parcel number. However, it is important to not rely on a property profile as a guarantee or warranty that the title is as represented. This is crucial information for the fiduciary and their attorneys to understand before preparing a plan for a client.
Preliminary Title Reports will disclose any involuntary liens that have attached to title under the current, or prior, ownership. As with a property profile, a preliminary title report is not a guarantee, warranty or representation that the title is subject to the liens reported or that the report includes all the liens that might affect title to the property. In cases such as this, as well as with difficult property profile situations, it is important to work with a probate financing company that has the ability to assume the risks and make the necessary loans.
Title Insurance Policies are issued after completion of a transaction (and the deed/s have been recorded in the local county assessor’s office). This policy is a guarantee, warranty or representation of the title vesting (subject to policy limitations), and that the title is subject to the liens reported – or that the policy includes all the liens that might affect title to the property. In limited situations, probate financing companies that specialize in challenging title issues may be able to proceed without a title policy.
First Probate Loans manages the probate financing process for short-term loans to trusts and estates, post-property distribution loans, and distributions of trusts and estates. The company specializes in resolving challenging and difficult problems related to title reports. The company provides complimentary property profiles, recorded liens and last vesting deeds, upon request (jonathan@firstprbateloans.com).
Prepared by: By Jonathan Brooks, President, First Probate Loans, for PFAC newsletter, Q1 2015
Is it possible to have only one realtor between buyer and seller as opposed to a buyer realtor and a seller realtor, to save on commissions?
Thank you for defining these in simpler terms- things like title reports can get confusing.
Thank you for providing such clear definitions! As a young college student, I was seriously confused before this article. Just breaking into this world of financials and loans is a very overwhelming experience!
Thanks for putting these in layman’s terms!
With the Title Insurance Policies when you stated that the policy “….representation of the title vesting.” What kind of “representative of the title vesting” is subject to policy limitations for the Title Insurance Policies and give a scenario of applying for with the process of title reports?
With the Title Insurance Policies when you stated that the policy “…representation of the title vesting.” What kind of “representation of the title vesting” is subject to policy limitations for the Title Insurance Policies and give a scenario of the type with process of the title reports?
How do title insurance policies work as warranties?