Real Estate Practice – Chapter 12 (Escrow and Title Insurance)

*An easement appurtenant requires two adjoining properties and runs with the land
*An easement is the right of an individual or entity to use the land of another for a special purpose
*An easement in gross does not involve granting access to one landowner needing access rights through an adjacent parcel of land
All of the above

(An easement appurtenant is the right of an owner of one parcel of land to use the land of another for a special purpose. A minimum of two parcels of land is required to create an easement appurtenant. An easement in gross is a right to use the land of another that is not created by virtue of a party's ownership interest in a parcel of land. The most common example of easements in gross is an easement given to utility companies to bring service to a property)

Settle disputes between parties which arise at closing

(Some of the duties of an escrow agent include ordering a preliminary title report, securing payoff letters from existing lenders, and issuing receipts for the deposit of documents and funds. Escrow officers do NOT offer legal advice regarding a transaction or settle disputes between parties to a transaction)

An attorney selected by the buyer

(Neither real estate agents nor escrow agents are permitted to offer advice on the manner in which a client or customer should take title to property. To do so is the unauthorized practice of law. Always advise clients or customers to seek competent legal or tax advice on the manner in which title is to be held)

A mechanics lien is a type of voluntary lien

(A mechanics lien is an involuntary lean, recorded against a property by contractors, subcontractors, and material suppliers to ensure the payment of money due for labor and/or materials on new construction, land improvements, or remodel projects)

a seller to directly or indirectly require that title insurance be obtained from a specific title insurance company as a condition of sale.

(It is a violation of RESPA Section 9 for a seller to directly or indirectly require that title insurance be obtained from a specific insurance company as a condition of sale)

a lis pendens.

A lis pendens is a notice to the entire world that there is a lawsuit pending regarding the title or possession of a specific property. It is a warning to all potential buyers that there is ongoing litigation regarding the property, and that all parties, such as potential buyers and lenders, will be bound by the outcome of the pending litigation)

Provides for increased protection.
Provides the lender with protection against the deed of trust or mortgage being recorded other than as instructed.
Removes the standard policy exceptions.
All of the above

(The CLTA/ALTA Extended Coverage Policy provides for increased protection against risks that can be ascertained only by an inspection of the property or through addressing other items not found on the public record. It also provides the lender protection against the deed of trust being recorded other than when requested, which could allow for liens to be recorded in front of the deed of trust. The Extended Policy removes the five standard policy exceptions)

*Should include a list of any personal property that is to transfer with the real estate.
*Includes all addenda to the initial agreement as they occur.
*Is found in the real estate purchase and sale agreement. All of the above

(The basic information required to open an escrow is found in the real estate sale agreement. Some of the information required to open escrow include a list of any personal property that is to transfer with the real estate. If events are not to occur as described in the original agreement, further addenda will be executed by the principals and forwarded to escrow)

It will have a credit for every debit reflected

(Debits are something that is owed or an amount to be charged to either the seller or the buyer. A credit is money owed to the seller or the buyer or an amount paid to either the seller's or the buyer's account in escrow. Debits and credits should not be thought of in the accounting sense since there is not always a debit for every credit)

Put the preliminary report in the file and wait for the final title insurance report at closing.

(The real estate agents should review the title report and determine if there are items on the report that will adversely affect the closing of the property as agreed upon. If Covenants, Conditions, and Restrictions (CC&Rs) are mentioned, a copy should be ordered and delivered to the buyer. In order to verify that the seller has legal authority to sell the property, note the manner in which the seller took title. If anything is unclear or unacceptable on the report, ask questions and get the matter dealt with as soon as possible and not wait until the closing of the transaction)