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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. 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)
In Massachusetts, an attorney must represent the Lender in a mortgage closing
transaction. 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)
| SMITH & JANIAN, LLC Attorneys at Law 820 Turnpike Street, Suite 106 North Andover, Massachusetts 01845 Phone: 978-682-1700 Fax: 978-682-1744 Admitted in Massachusetts and New Hampshire |
Copyright © 2006 Smith & Janian, LLC, Attorneys at Law. 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 be
considered advertising under the Rules of the Supreme Judicial Court of Massachusetts.
does not create an attorney-client relationship, and should not be construed as legal opinion on any specific facts or circumstances. This information may be
considered advertising under the Rules of the Supreme Judicial Court of Massachusetts.