Title Insurance - An insured statement of condition of title or ownership of real property.
Once - How often can you charge for an insurance premium for title insurance?
Owner's Policy - A type of title insurance policy issued to the fee simple owner of a property which
provides the insured coverage over the risks described in the policy.
Commitment/Binder - A document that must be issued before the effective date of a policy that shows
only those exceptions contained and intervening matters after the date of the document and before the
effective date of the policy.
Preliminary Report - A report as to the condition of a title and a commitment to issue a title insurance
policy when certain conditions are met and contains the conditions under which a policy of title
insurance will be issued. Also known as a commitment or binder.
Exceptions - A provision in a title insurance policy binder or policy that excludes liability for a specific
title defect or an outstanding lien or encumbrance, such as easements and restrictions.
Endorsements - An addition or modification of a title insurance policy which expands or changes
coverage of the policy, fulfilling specific requirements of the insured.
Underwriter - Individuals that must decide whether to issue a policy, the appropriate premium to charge
and write policies that cover these risks. They serve as the main link between the insurance carrier and
the insurance agent.
Insurance Company - An organization that exists to protect individuals and entities from financial loss by
assuming risk.
Encroachment - The situation that exists when a structure is built in whole or part on a neighbor's
property.
,Encumbrance - Anything which effects or limits the fee simple title to property, such as mortgages,
easements, or restrictions which do not prevent alienation of the fee simple title by the owner.
Requirements - Conditions in a title insurance binder that must be met or otherwise cleared before title
can be insured and a policy can be issued.
Subrogation - The substitution of one person in the place of another with reference to a lawful claim or
right.
Mortgagee/Grantee/Lender - Person/entity that will receive title to a property if the mortgagor defaults
on the loan which is secured by the mortgage (or deed of trust)
Chain of Title - Notations of deeds, distribution from estates, certificates of death, foreclosures, quiet
title and other recorded transfers of title are included on what document?
Closing and Settlements - Depending on the state, this is handled by a title company, escrow holder or
attorney.
Joint Tenancy - What kind of ownership is not passed by will?
Escrow - The deposit of instruments, funds and instructions to an independent third party to carry out
the provisions of an agreement.
Title Defect - Any cloud on title, such as claim to the title by someone or thing due to a prior lien or
improper conveyance, or an inaccurate description of the property.
Chain of Title - In many real estate transactions, insurance companies issue title insurance based on this
when it is transferred.
Transfer Tax and Recording - This is paid by the buyer or seller each time a property is transferred as
evidenced by the Recorder of Deeds (Missouri doesn't require this fee)
, Mortgagor/Mortgagee - Legal terms to define the borrower and secured lender on a loan.
Construction Loan Policy - This type of policy is issued when the property has a loan for construction on
the property.
Closing and Settlements - The final exchange in the sale and purchase of real estate where the title is
transferred, financing documents and title insurance policies are exchanged, and costs are paid.
Chain of Title - A history of passing of title ownership from the present owner back to the original
owner.
Simultaneous Issue - Issuance of multiple policies on the same property at the same time, where the
amount of issuance on the second property is less than that of the primary policy.
Conventional Subrogation - Based on an understanding or an agreement when an uninterested party to
the matter who pays the debt of another becomes entitled to the right of the creditor. The substitution
of another person in place of the creditor whose rights he succeeds in relation to the debt.
Real Property - Land and anything permanently affixed to the earth, including all natural attributes and
any man-made improvements of a permanent nature thereon. (Ex. minerals, trees, buildings,
appurtenant rights)
Leasehold - A policy of title insurance related to a lease.
Terms, Conditions and Stipulations - Governing language of a title policy.
Tenants in Common - This form of ownership does not pass to surviving owners in the event of death of
one of the owners but ownership in the property is left to their heirs as specified by will.
Exclusions - Specifically set out matters that a policy will not protect against.
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