If you are visiting this site and are seeking a Mortgage Lender or Realtor, please feel free
to contact our office.  Our firm works with the top Mortgage Lenders and Real Estate
Professionals in the region.   
Role of Real Estate Attorney

In Massachusetts, an attorney must represent the Lender in a mortgage
closing transaction.  It is also the recommended practice for New
Hampshire transactions.  In the purchase or sale of real estate it is also
common for each party to have their own attorney to represent their
respective interests.  Our office provides full-service real estate attorneys
representing Lenders, Buyers, and Sellers.

Attorney for Lender:

The main function of the Lender’s attorney is to protect the Lender’s
interest by insuring that the title is clean and marketable.  In order to
accomplish this, the Lender’s attorney:
•        Orders the title exam and works with the seller’s attorney to resolve
any title issues that are discovered
•        Orders a Municipal Lien Certificate from the city/ town where the
property is located to check for past due taxes and water and sewer
charges on the property
•        Orders a plot plan for the property that outlines the lot dimensions
•        Coordinates with all parties involved to schedule the time and
location of the closing
•        Records the new deed, mortgage, and any other relevant
documents at the appropriate Registry of Deeds
•        Pays off the existing mortgage and any liens from the Seller’s proceeds
•        Files IRS disclosures related to the transaction
•        Certifies clean title to the Lender and issues title insurance policies to
the Lender and the new owner
Note:  The same attorney may represent both the Lender and the Buyer in
a purchase transaction.

Attorney for Buyer:

The role of the Buyer’s attorney is similar to that of the Lender’s attorney in
that both are concerned with obtaining a clear and marketable title for
their client. The Buyer’s attorney has the addition responsibility of handling
the negotiations with the Seller and the Seller’s attorney. The Buyer’s
attorney negotiates the Purchase and Sale agreement on behalf of the
Buyer and advises the Buyer as to what documents will be needed for
closing and reviews the terms of the Buyer’s loan with them.
Specifically, the Buyer's attorney:
•        Reviews the offer and purchase and sale agreement and negotiates
changes related to inspection issues with Seller’s attorney
•        Discusses options for how to hold title with client
•        Discusses terms, conditions, and contract dates with the Buyer’s
Lender to ensure that deadlines and conditions are satisfied
•        Reviews the HUD settlement statement prepared by the Lender’s
attorney to ensure closing costs and adjustments between the Buyer and
the Seller are correct
•        Attends closing with the Buyer’s and reviews all paperwork including
mortgage, note, and other documents with Buyer

Attorney for Seller:

The Seller’s attorney’s role is to make sure the sale goes smoothly by
dealing with any title issues and handling any negotiations for Seller,
including;
•        Preparing the offer and Purchase and Sale Agreement and
negotiating any changes with the Buyer’s attorney
•        Preparing the deed from the Seller to the Buyer
•        Resolving any title issues that are discovered through the Lender
attorney’s title search including obtaining missing discharges or mortgage
assignments, missing death certificates, and a myriad of other title issues
that could arise, in many cases the Seller is not even aware of the title
problems before the title is searched.
•        Attending the closing and reviewing all Seller’s documents
•        Reviewing the HUD settlement statement, prepared by the Lender’s
attorney to insure all closing costs ad adjustments are correct
•        Obtaining payoff information for Seller’s mortgage so that it can be
satisfied at closing

Title Insurance:

The purchase and sale of a house is often the single largest financial
transaction in a lifetime. It is important that you be represented by the
attorney of your choice before you begin the buying or selling process.
What is Title Insurance?  
Title insurance is an exclusively American invention. Its purpose was well
stated in the first advertisement for title insurance back in the late 1800s:
"This company insures the purchaser’s of real estate and mortgages
against loss from defective titles, liens, and encumbrances. Through these
facilities [the] transfer of real estate and real estate securities can be
made more speedily and with greater security than hereto before." [circa
1876]
Protecting purchasers against loss is accomplished by the issuance of a
title insurance policy, which states that if the status of the title to a parcel
of real property is other than as represented, and if the insured suffers a loss
as a result of title defect, the insurer will reimburse the insured for that loss
and any related legal expenses, up to the face amount of the policy.
Title insurance differs significantly from other forms of insurance. While the
functions of most other forms of insurance is risk assumption through the
pooling of risks for losses arising out of unforeseen future events (such as
death or accidents), the primary purpose of title insurance is to eliminate
risks and prevent losses caused by defects in title arising out of events that
have happened in the past. To achieve this goal, title insurers perform an
extensive search of the public records to determine whether there are any
adverse claims to the subject of real estate. Those claims are either
eliminated prior to the issuance of a title policy or their existence is
excepted from coverage.

Benefits of Title Insurance:

Title insurance issued provides a broad range of benefits to the parties
involved in a real estate transaction.
To the Purchaser of Real Estate
The purchaser of real estate needs protection against serious financial loss
due to a defect in the title to the property purchased. For a single, one-
time premium, which is a modest amount in relationship to the value of
the property, a buyer can receive the protection of a title insurance policy
– a policy that is backed by the reserves and solvency of the Company. A
title insurance policy will cover both claims arising out of title problems that
could have been discovered in the public records, and those so-called
"non-record" defects that could not be discovered in the record, even
with the most complete search.
A title insurance policy will not only protect the insured owner, but also
that person’s heirs for as long as they hold title to the property, and even
after they sell by warranty deed. The Company will not only satisfy any
valid claim made against the insured’s title, but it will pay for the costs and
legal expenses of defending against a title claim.

To the Lender

The overwhelming majority of mortgage loans made in the United States
are made by persons who are acting in a fiduciary capacity – by savings
and loan associations, savings banks, and commercial banks on behalf of
their depositors, and by life insurance companies on behalf of their
policyholders. Because they are lending other people’s money (other
people’s savings or policyholder’s funds) these lenders must be concerned
with the safety of their mortgage investments.
A policy of title insurance provides a mortgage lender with a high degree
of safety against the loss of security as a result of a title problem. This
protection remains in effect for as long as the mortgage remains
unsatisfied.

To the Seller

An owner of real property whose interest is insured by an owner’s title
insurance policy has the assurance that the title will be marketable when
selling the property. The title insurance policy protects the Seller from
financial damage if the Seller’s title is rejected by a prospective purchaser.
Also, when the Seller conveys with "warranties," which is a traditional, the
Seller is still protected if the Buyer sues because of a breach of those
warranties.

To the Real Estate Attorney

Title insurance enables the real estate attorney to provide the client with
substantially greater protection than would be afforded by the attorney’s
opinion alone. The attorney’s opinion is only limited to recorded matters
and the client can only recover from the attorney if the attorney is found
to be negligent.

Title Issues

The job of searching the public records to identify existing rights and
interests is not an easy task. The title searcher or abstracter reviews the
public records to find all aspects of title, which can be seen and
recognized. From the title search, the title examiner produces an opinion
of title, from which the Company will issue its insurance.
In many areas, the title to a property can be traced back to a royal grant,
charter, or the United States government. In many areas, titles are not
traced back that far; instead, local custom or title insurance company
requirements dictate a shorter search.
There are few titles, if any, that have a perfect history from their source, or
root, to the present day. Each transfer of ownership is a "link" in what is
referred to as the "chain of title." As each transaction or link takes place,
there is a potential for a problem. Even if the entire chain of title appears
to be in order, the chain is still subject to interpretation. When searching a
title, what we are trying to determine are the various rights and interests
that make up each link in the chain as it has passed from one owner to
another.

A "title" is composed of three basic elements.

1.        Rights and interests that are disclosed in the public records or by
physical inspection of the property, i.e., deeds, mortgages, leases, etc.,
parties in possession, utility easements, etc.
2.        Rights and interests that are not recorded but exist, i.e., limitations
imposed by laws and statutes, etc.
3.        Rights and interests that are hidden, i.e., forgeries, secret marriages
and unknown heirs.

Every title is made up of many different "rights" and "interests" that may be
owned by different people. The "owners" of the property own the most
valuable of the property’s rights and interests, but other people may also
have rights to the property, such as easements for utilities or mortgages,
etc.
Each title can be compared to sticks in a bundle. The rights and interests
are represented by the sticks. The "owners" own what we call a "fee simple"
title, that is, they have purchased the most vital and valuable sticks
including rights of possession, use, occupancy, enjoyment, inheritance, etc.
Also, within the bundle are sticks that may be owned by other parties.
These are called encumbrances and may consist of easements,
mortgages, liens, etc.
When a person purchases a parcel of real estate, it is not only the physical
property itself that he or she acquires, but the sellers rights and interests,
"the seller’s title," in the property. It is essential for the prospective
purchaser to know before the transaction takes place, precisely what
rights or interests the seller can convey. The purchaser also needs to know
who else may have rights or interest in the property, and about any
encumbrances against the property that may affect the use or enjoyment
of the land. The title search must cover all these rights and interests.

TITLE INSURANCE FAQ

Why Do You Need It?

Buying a new home is one of life's most gratifying experiences. As you
approach the big day of closing, however, all the details can be a little
overwhelming. You might easily overlook the single most important step in
the entire process -- the purchase of Title Insurance on the wonderful new
home of yours.

What is a Title?

A title is the evidence, of right, that a person has to the ownership and
possession of land. It is possible that someone other than the owner has a
legal right to the property. If that right can be established, this person can
claim the property outright or make demands on the owner as to its use.

Do I need Title Insurance?

Definitely. Title insurance is a means of protecting yourself from financial loss
in the event that problems develop regarding the rights to ownership of
your property. There may be hidden title defects that even the most
careful title search will not reveal. In addition to protection from financial
loss, title insurance pays the cost of defending against any covered claim.

What can make a Title Defective?

Any number of problems that remain undisclosed after even the most
meticulous search of public records can make a title defective. These
hidden "defects" are dangerous indeed because you may not learn of
them for many months or years. Yet they could force you to spend
substantial sums on a legal defense, and still result in the loss of your
property.

But the lender already requires Title Insurance, won't that protect
me?

Not necessarily. There are two types of Title Insurance. Your lender likely will
require that you purchase a Lender's Policy. This policy only insures that the
financial institution has a valid, enforceable lien on the property. Most
lenders require this type of insurance, and typically require the borrower to
pay for it.
An Owner's Policy on the other hand is designed to protect you from title
defects that existed prior to the issue date of your policy. Title troubles,
such as improper estate proceedings or pending legal action, could put
your equity at serious risk. If a valid claim is filed, in addition to financial loss
up to the face amount of the policy, your owner's title policy covers the full
cost of any legal defense of your title.

How much does Title Insurance cost?

The one-time premium is directly related to the value of your home.
Typically, it is less expensive than your annual auto insurance. It is a one-
time only expense, paid when you purchase your home. Yet it continues to
provide complete coverage for as long as you or your heirs own the
property.

What items are needed at closing?

You will want to have these items complete or in hand when you come to
the closing (please confirm with your escrow officer, as practices vary by
state):

Buyer
•        Cashier's check(s) to make all payments
•        Proof of purchase of insurance for fire, casualty, etc.
•        Photo identification (passport, driver's license, or state-issued
identification card)

Seller
•        Invoices for any unpaid taxes, utilities, assessments, and latest utilities
meter readings
•        Any unrecorded instruments that affect the title
•        Proof of satisfaction of any mechanics' liens, chattel mortgages,
judgments, or mortgages that were paid prior to the closing
•        Photo identification (passport, driver's license, or state-issued
identification card)
Copyright © 2009 Peter Smith Law Offices, LLC.  All rights reserved.  The information contained in this website is solely for informational purposes, does
not create an attorney-client relationship, and should not be construed as legal opinion on any specific facts or circumstances.  This information may
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