Why Review the Preliminary Title Evidence When Buying a Home in Ann Arbor, Michigan?
Sometimes when I list a house, I may find that there are surprises the seller may not know about. If you’re buying a home in the Ann Arbor, Michigan area, you should receive a preliminary title policy from the title company within a few days of signing the sales contract.
This is the title company committing to issue title insurance subject to the terms inside the policy.
It begins with a page called “Schedule A.” Schedule A describes who will be insured, to what amount, and legally describes the property on which they’ll issue title insurance. The Seller usually pays for a title policy in the amount of the sale price to insure clear title to the Buyer. The Buyer pays for a title policy required by the lender, in the amount of the loan.
It continues with "Schedule B, Section 1". This describes the requirements that must be met before the title policy is issued. Typically in this section, you see the Seller’s loans that must be paid off, any taxes due, anything that must be satisfied before the policy can be issued. This is a must-read section. Sometimes, there’s an odd lien or requirement that you need to find out about sooner rather than later.
"Schedule B, Section 2" are exceptions to the title policy - things the title policy will not cover. Usually, this list includes the recorded easements, future tax liens, etc.
Issues do surface. Some times we find gas and oil leases that may be defunct so we will contact the gas company to remove this. Sometimes we find a mortgage has not been discharged even though it was paid off. There may be a road assessment that needs to be disclosed. There may be a tax lien that one of the Sellers does not even know is on the home. There have been improper legal descriptions. Previous title policies may have missed easements. Finding out about these issues early allows them to be addressed. If you don’t understand what you see, you can always ask your agent, attorney or title agent to explain it to you. We align with Liberty Title and have access to Harvard undergrad and U of M Law grad Tom Richardson, owner, who is extremely valuable.
Whether you are buying your first home or your 10th home, it is not an easy process, but that is ok, we are here to help. Contact me anytime.
Kathy Toth and Team
Keller Williams Realty
2144 S. State St., Ann Arbor, Michigan 48104
Phone: (734) 669-0337
Fax: (734) 661-4315
info@KathyToth.com
Related Links
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Kathy Toth and Team
www.KathyToth.com
Keller Williams Realty
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