Submit your Buyer/Borrower Information
1. INSURANCE. (a) At the time of closing, please bring with you a homeowner fire and extended coverage insurance policy or binder for such insurance either in an amount at least equal to the total of all new mortgages on the property or 100% of the replacement cost of all insurable buildings and other improvements on the land. IF YOU ARE GOING TO RELY ON THE 100% REPLACEMENT COST AMOUNT AS SUFFICIENT INSURANCE, THEN THE POLICY OR BINDER MUST STATE THAT 100% REPLACEMENT COST IS IN EFFECT. The insurance policy or binder must name all of the persons who will hold title to the property. The mortgage clause adding the mortgagee’s insurable interest to all policies MUST BE WORDED in accordance with the instructions listed in your commitment letter issued by the Lender.
Your insurance agent MUST email, fax or deliver to our office a copy of a binder for such insurance along with a receipt showing that the first year’s premium is paid in full, at least three (3) business days prior to closing.
2. FLOOD INSURANCE. If the premises is located within a specially designated federal flood hazard area then flood insurance is a mandatory requirement and you must provide a flood insurance policy together with a paid receipt for the full first year’s premium at or before the closing. Please note that if the premises is located within Zone B, flood insurance is not required.
3. RENT LOSS INSURANCE. If this transaction involves a loan on investment premises or a 2-4 family dwelling then rent loss insurance may be required and an appropriate binder to that effect will be required at or prior to closing. You should check with the Bank for applicability of rent loss insurance to your loan.
4. TITLE INSURANCE. The lender requires that they be provided with a lender’s title insurance policy (loan policy) to protect their interest in your property up to the amount of the mortgage. While the premium for the loan policy is included in your closing costs, it does not protect you. Your ownership interests are insured only by an owner’s title insurance policy (owner’s policy). While the lender’s coverage under the loan policy decreases as the mortgage is paid down and terminates when the final payment is made, your owner’s policy remains in effect for as long as you and your heirs own the property. The owner’s policy is available for a one-time premium and at a discounted rate if purchased simultaneously with the loan policy at the time of closing.
The owner’s policy provides coverage for numerous matters which are not covered by the standard attorney’s certification of record title, and which are not discoverable by searching the land records. Typical examples of such matters include: forged documents, the incapacity of a grantor, undisclosed or missing heirs, missing signatures, mistakes in recording, unknown creditors and problems involving access to the land. The Eagle Policy available through First American Title Insurance Company, provides additional protection for problems such as: zoning and building permit violations, restrictive covenant violations, encroachments and defects in title.
This enhanced coverage is available at a cost of 10% more than the standard owner’s policy. For more information on the Eagle policy please visit firstam.com. We believe that obtaining an Owners Title Insurance Policy is in your best interest, which is why we always plan to issue the policy and include the additional premium cost in the settlement figure that you will bring to closing unless you advise us to the contrary. If you prefer to obtain the enhanced coverage offered by the Eagle policy or the equivalent, please notify the office prior to the closing.
5. CONDOMINIUM INSURANCE. If the mortgage involves a condominium unit, we will require a Certificate of Insurance from the insurance carrier for the condominium naming you and the Association and identifying the unit you are purchasing. The language naming the Bank must be in the form set forth in Paragraph 1 above. Please note that you may be required to purchase additional insurance if the insurance company does not provide 100% replacement cost coverage.
6. OTHER CONDOMINIUM REQUIREMENTS. A “6 (d)” certificate stating that there are no unpaid common charges to the condominium association as of the date of closing must be issued and sent to us prior to closing. This certificate is obtained from the trustees or managers of the condominium and must be in the form prescribed by law. You should be sure that the seller procures such a document before the closing.
7. MANNER IN WHICH TITLE WILL BE HELD. Described below is an explanation of some options on how to hold title to real estate. Please advise our office indicating how you would like to take title to the property.