Larry and I took an interesting class today with attorney Greg Ursich covering legal issues from purchase and sale to closing.  It covered title insurance, types of deeds, essential elements of a purchase and sale agreement, and avoiding misrepresentation. 

The new thing that I learned about title insurance that more people will come up against is this:  if you place a property into a trust, an LLC, or any other ownership entity AFTER the purchase, the title insurance coverage ends.  You can provide for continued coverage by contacting your title insurance company and obtaining a rider to transfer the title to the new entity.

It was interesting to get the information about each kind of title insurance–there are three–without the marketing bent of a title insurance rep.  Greg’s a lawyer who is often hired by title companies to handle legal issues that arise in this arena, so he sees not as a salesman, but as a practicing litigator, handling claims and problems. 

Title insurance is backward looking–not forward looking like most insurance–though there are some new provisions for identity theft and future encroachment.  Title is primarily research of the marketability of the title using recorded documents for the research.  I can get lots more detailed, but for a blog, I’ll keep this brief.  Title insurance tends to be rather dry till there’s a problem.  Any time you have a question, I’d be happy to talk it over with you, and either explain it myself, or get you in contact with one of our title partners.

Regarding deeds, there are three basic ones.  Warranty deed, the most common.  Bargain and sale, usually for lender owned foreclosures or estate sales.  Quit claim deed, with no warranties or covenants attached to it.  Add a spouse, or remove a spouse from ownership on a property using a quit claim deed, and it would be good to check with your title insurer to make sure you are still covered.

Regarding the purchase and sale contract, real estate agents have a license for a limited practice of real estate law. Limited because we are licensed to fill out standardized forms that have been painstakingly created by lawyers.  We are allowed to fill in the blanks, and create simple addenda with simple instructions like extending closing dates or instructions following inspections.  Custom instructions or agreements beyond the agents expertise should be created by a lawyer.  A real estate agent that writes anything into a purchase and sale agreement will be held to the same standard as a lawyer. 

Disclose disclose disclose is the mantra for a real estate agent, and incidentally for the seller of real estate.  I’ve been told by one of the area’s top lawyers that a seller need not disclose an issue in their home that has been fixed.  But Greg advises that it’s better to tell the buyer everything–the problem, the repair, the whole history.  More comfort for the buyer, more protection for the seller. 

All in all, a great class, lots of info, even better super agents.