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[Music] I'm attorney Charlie wood and I'm the chief operating officer managing partner of attorneys Title Services we're a national tonic company based out of Jacksonville Florida and this instructional video we go over what its title insurance What is the title commitment the common title endorsements and how to read the title commitment so the first question we often get asked is what is title insurance so Tunnel insurance is an insurance policy that covers you if title problems come up after you buy a refinance property possible complications include lost force or incorrectly filed deeds property access issues and liens on a property and a good example this is if there is an unpaid mortgage on the property that you just bought you may be held legally responsible without title insurance you might have to pay the legal costs to settle the dispute if you lose the dispute it could cost you money the equity you have in your home and perhaps even the ownership of the home title insurance is designed to cover associate a legal costs to settle the dispute and/or to resolve the problem now there's two types of title insurance surd is the owners policy in the lenders policy the owners policy protects the you the homeowner for the full price of the home plus legal cost if title or ownership issues arise after you buy your home this type of policy is issued for the amount you paid for the home and will cover you as long as you own an interest in the property the other policy is the lenders policy in an only protects a lender if a title issue or ownership problem comes up after the property is purchased that affects the lenders lien position for the mortgage the letter's policy is issued for the amount of the mortgage and unlike the coverage from the owners policy it decreases as you pay down the loan and ultimately when the loan is paid off the loan policy goes away and most lenders will require you to have a lenders title insurance policy as part of a loan transaction talen surance rates are set by the state of florida and they're contained in the Florida Administrative Code pursuant to the rules of the Florida State Treasurer and insurance Commission and the way that the premium is calculated is based on a per thousand cost so any policy up to hundred thousand dollars is five dollars and seventy five cents per thousand and then from a hundred thousand to a million it's five dollars per thousand a million to five million is two dollars and fifty cents per and from over five million to ten million is two dollars and twenty-five cents per thousand and anything over ten million is $2 per thousand so for example a hundred thousand dollar Tamil insurance policy costs five hundred seventy five dollars and a two hundred thousand dollar policy will cost one thousand seventy five dollars in Florida we also have a thing called a simultaneous issue fee and this is where a loan transaction is involved with the sale the property float allows a discount on the lower priced title insurance policy called simultaneous issue fee so for example if the sales price is 200 thousand and the loan is 150 thousand the owners policy for the sale price would be charged at the full state set rate which would be a thousand seventy five dollars for the owners policy but the loan policy will be charged a discounted rate of one hundred fifty dollars in the state of Florida we have four common title insurance endorsements that go along with the lenders title insurance policy they're the four point one the five point one the eight point one in the Florida forum line the four point one the five point one go together one is for a condominium endorsement one it's very plain unit development endorsement or homeowners association endorsement as it's often referred to so for point one covers the condos ensures that the unit is part of the condominium and the condominium documents comply with state requirements there are no violations or restrictive covenants and that the documents contain no provisions which cause a forfeiture or aversion of title that the mortgage has priority over liens for charges and assessments that the unit will be assessed as a separate parcel for real estate taxes that there's no obligation to remove and improvements to to encroachments and that there has been no right of first refusal which would defeat title and the other one the HOA endorsement the endorsement five point one is the same except it's for homeowners association properties Planning Unit development property and of course if you're not buying a condo and you're buying a house that is not within a homeowner's association then neither of these would apply the other common ones through the eight point one the Environment Protection lien endorsement this provides limited insurance that no environmental protection lien has been filed of record or provided by state law as of the date of the policy that has probably early over the mortgage and Florida form 9 is restrictions and encroachments this endorsement provides insurance against lost or damage resulting from the violations of deed restrictions encroachments and step back lines existing as of the date of the policy so with every contract in the state of Florida whether it be the farm or contract the Florida Bar Florida Realtors contract or the Northeast Florida Association of Realtors contract all provides a provision in there for the delivery of the title insurance commitment what the Talent Search insurance commitment is is a document that sets out the rules for the road of your transaction provides a guide on some what needs to be done in order to convey clear and marketable and insurable title the parts of the commitment are schedule a which describes who and what will be insured Schedule B 1 what sets out the items to be cleared created or resolved in order to ensure title and schedule B 2 which lists the exceptions to coverage this is a standard American land title Association type of commitment that the underwriters in Florida use and this is one based on one that was prepared by West cor land title insurance company which is one of our underwriters so Schedule A lays out the hood one of the transaction so it has the state and county of the property the property address that's being sold it has the underwriters plant file number the title agents file number the effective date of the top commitment which this is the date that the public records were current as of the date that they did the search on the property to create this type of commitment right here has the policies that are to be issued it has the owners policy to John Smith and Jill Smith who would be the purchasers of the property for two hundred seventy thousand dollars so two hundred seventy thousand dollars would be the purchase price of the property we have a proposed to loan policy to giant global mortgage for two hundred thousand dollars so in this one the lender would be giant global mortgage and the loan would be two hundred thousand dollars down here we have the stator interest in the property so this would be either fee simple or leasehold interest in Florida fee simple means that the owner has clear ownership to it leasehold interest would be that the person selling the property has a lease on it such as a 99-year land lease so this one here is fee simple so they have the full fee simple ownership to the property this one on here number 4 shows us title to the state or interest in the land as of the commitment date and is vested in and this would be who the seller should be so these are the people who actually have the ownership as of the date of this tile commitment and this has Sam Jones and Sue Jones so on this contract Sam Jones and Sue Jones should be the seller and if it's someone else you know who there's an issue section 5 has the land is described as follows it says see schedule RC attached scheduled a continuation legal description for really small legal descriptions that would be in here if the legal description is bigger they would be on a separate page and then it has a place down here for the title agents assign which would be US attorneys title services and then here's a continuation page so this is the full actual legal description of the property is being sold lots of 29 30 31 32 of block 24 see of happy villa states according to the plat there over court and plat book 800 pages 23 through 25 of the current public records of Duval County Florida Schedule B section 1 tells us what we need to do to be able to convey clear title as part of the closing so it starts out with documents satisfactory to the company to convey title or create the mortgage to be insured so tells us right here we need to get a warranty deed from the current owner to the proposed insured owner conveying the land we need to get a mortgage from the proposed in short owners so the buyer to the proposed lender that wouldn't come to the land oh it has notice on here for us that if there's any spouses involved that aren't on title and that this is homestead property that the spouse has to join or we need to include non homestead language if it's not homestead it says pay the agreed amount for the estate or interest to be insured so this is make sure that the buyer pays the seller payment of taxes charges assessments levied against the subject property which are due so this is make sure any pass to property taxes are paid any special assessments or anything like that are paid next one here is satisfactory evidence should be have that all improvements or repairs or alterations that are completed that contractors subcontractors labor and material men are paid basically if there's been any work that's been done on the property that everything's been paid for the next one tells us section three and four which will go over a Schedule B section two may be amended from the policy to be issued if they serve a satisfactory the company is furnished to the company what this is is provided that there is a clear survey showing that there's no boundary encroachment issues were able to remove the survey exceptions which we'll go over on the next page number six on here says release or satisfaction of the mortgage to be executed by the owner in favor of and has the mortgage company so this would be an existing mortgage by the seller lets us know that we need to get a release or have it satisfied from the public records down here is satisfactory evidence that all homeowners associations dues or assessments including any special assessments against the land the property is being sold or paid in full to date so with that we need to get a stop a letter from the homeowners association to verify that everything is current and the last one here is pay the premiums fees and charges for the policy to the company so make sure that the fees for the owners policy in the lenders policy and the endorsements are covered and paid to the entire trip Schedule B section two goes over exceptions to the top policy but a little hard to see here but one through five far consider the standard exceptions in Florida that were able to remove with an owner seller affidavit provided none of these things exist so the first one is defects liens and Commerce's adverse claims or other matters etc we would have the seller sign an affidavit attesting that none of these exists and if that is true and they sign it were able to remove that as an exception the second one is rights or claims of parties in possession not shown by the public records so if this is owner occupied and the owner is selling it to the buyer and there's no tenants we'd be able to remove this one three and four go with the survey the first one is any encroachment and commerce violation variation or adverse claim affecting the property as well as easements or claim of easements not shown by the public records with a clean survey showing that there are no issues with these we were able to remove those so that way if later they're wanna being a survey issue the tile insurance policy would provide coverage for it number five taxes are special assessments which are not shown as liens existing by the public records so this is us just making sure that any back property taxes are paid and that if there are any special assessments they are paid us at the day policy we will remove that one number six here says taxes and assessments for the year 2018 years which are not yet due and payable with this and would verify that the 2018 taxes were paid we would keep this but we would modify it to 2019 so that way any 2019 taxes wouldn't be covered but any taxes predating that would be covered number seven on here we were able to remove with a clean municipal lien search showing that there is no pass to water sewer mounds there's no special assessments there's no code violations anything like that with a clean municipal lien search were able to remove those the next two eight and not on here we're not able to remove because they've run with the land the first one is restrictions reservation setbacks and easements and it goes through the platen book and page number so this is the plot that was recorded in the public records of Duval County for the neighborhood such as where you can put the house and any setback lines and stuff like that these are things that run with the lanes and you cannot remove number nine on IRA's restrictions reservations covenants and conditions pursuant to a certain instrument recorded and the key for us on here says provides for a private charge assessment this is the homeowners association restrictions reservations and covenants and conditions that are filed so if you buy a house within a homeowner's association you require to abide by their rules the last section down here has the note about property taxes and lets us know that the property taxes a year 2017 were paid and the amount that was paid but also gives us the assessed value of the property and what the gross amount of the taxes were the last section on here has the ownership change for the last 24 months of the property and if there was no changes in ownership in the last 24 months of the property the under honor will put the last deed of record so as you can see on this one the last deed recorded was May 31st 2006 into the seller of the property had this been a foreclosure or an investment property and there's several transactions occurring within a 24 month period they would all be listed on here but since nothing occurred during that one the last change of ownership for this property was May 31st 2006 I hope this instructional video helped you better understand what title insurance is the costs involved how to understand the title commitment and the common title endorsements in Florida of course if you have any questions please feel free to email us at info at ATS closings comm or give us a call at nine zero four two six zero zero one zero five 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