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All About Title Insurance :::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::
WHAT IS TITLE INSURANCE?
Title Insurance is the modern method of real estate title protection. A policy of title insurance protects against loss if a covered defect is found in your title. When you buy a home, you are given a deed to the property that generally means you receive full legal ownership. Unfortunately, sometimes there’s a hidden mistake in a prior deed, invalid will, mortgage, etc., that may give someone else a valid legal claim against your property.

WHY IS TITLE INSURANCE IMPORTANT?
Title Insurance provides a “safety fence” around your property. Title Insurance can save you money, time, trouble and even your home!

WHAT IS THE DIFFERENCE BETWEEN AN OWNER’S POLICY AND A MORTGAGE POLICY? WHY DO I NEED BOTH?
An Owner’s Policy protects the interest of the owner of real estate and lists the name(s) of the new buyer as the insured party. As the new buyer, you will want assurance from the seller that the title is marketable and free from liens that could create problems in the event you should decide to see or refinance the property in the future. The Owner’s Policy does assure that the title is marketable and provides for defense of the title at the expense of the insurance company, if it is challenged or questioned by others. The Owner’s Policy is always in full-face amount and continues as long as the owner or his/her heirs have an interest in the property.

A Mortgage Policy protects the interest of the mortgage lender and lists the lender as the insured party. All lenders require the borrower to provide proof and assurance that the loan being applied for will be in correct lien position. If the validity of the lien of the mortgage is challenged or questioned, the policy provides for defense of the mortgage interest. The Mortgage Policy protection terminates immediately when the loan is paid off.

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What is Agency? :::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::
Disclosure Regarding Real Estate Agency Relationships

Before you disclose confidential information to a real estate licensee regarding a real estate transaction, you should understand what type of agency relationship you have with that licensee. A real estate transaction is a transaction involving the sale or lease of any legal or equitable interest in real estate consisting of not less than 1 or not more than 4 residential dwelling units or consisting of a building site for a residential unit on either a lot as defined in section 102 of the land division act, 1967 PA 228, MCL 560. 102, or a condominium unit as defined in section 4 of the condominium act, 1978 PA 59, MCL 559. 104.

Michigan law requires real estate licensees who are acting as agents of sellers or buyers of real property to advise the potential sellers or buyers with whom they work of the nature of their agency relationship.

A broker or salesperson may function in any of the following capacities:

  • Represent the seller as a designated seller’s agent or subagent
  • Represent the buyer as a designated buyer’s agent
  • Represent both the seller and buyer as a disclosed dual agent, authorized by both the seller and buyer

SELLER’S AGENT
A seller’s agent, under a listing agreement with the seller, acts solely on behalf of the seller. A seller can authorize a seller’s agent to work with subagents, buyer’s agents and/or transaction coordinators. A subagent of seller is one who has agreed to work with the listing agent, and who, like the listing agent, acts solely on behalf of the seller. Seller’s agents and their subagents will disclose to the seller information about the buyer, which may be used to the benefit of the seller.

The duties that a seller’s agent and subagent owe to the seller include:

  • Promoting the best interests of the seller
  • Disclosing to the seller all facts that might affect or influence the seller’s decision to accept an offer to purchase
  • Keeping confidential the seller’s motivations for selling
  • Presenting all offers to the seller

BUYER’S AGENT
A buyer’s agent, under a buyer’s agency agreement with the buyer, acts solely on behalf of the buyer. Buyer’s agents will disclose to the buyer known information about the seller, which may be used to benefit the buyer.

The duties a buyer’s agent owes to the buyer include:

  • Promoting the best interests of the buyer
  • Disclosing to the buyer all facts that might affect or influence the buyer’s decision to tender and offer to purchase
  • Keeping confidential the buyer’s motivations for buying
  • Presenting all offers on behalf of the buyer

DUAL AGENT
A real estate licensee can be the agent of both the seller and the buyer in a transaction, but only with the knowledge and informed consent, in writing, of both the seller and the buyer.
In such a dual situation, the licensee will not be able to disclose all known information to the seller or the buyer. As a dual agent, the licensee will not be able to provide the full range of fiduciary duties to the seller or the buyer. The obligations of a dual agent are subject to any specific provisions set forth in any agreement between the dual agent, the seller and the buyer.

Home Warranty Insurance ::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::

What Is Home Warranty Insurance?

 

Home Warranty Insurance is a protection policy placed on the home upon the closing date for a Buyer or upon application for the Seller’s property. It covers the mechanical and possibly some physical items on the property. Examples of items insured for a 12 month period upon closing would be:

 

  • Heating and Cooling Systems
  • Plumbing Stoppages
  • Whirlpool Bath Motor and Pump Assemblies
  • Electrical System
  • Appliances
  • Garbage Disposal
  • Hot Water Pump
  • Water Heater
  • Garage Door Opener
  • Central Vacuum
  • Ceiling Fans
  • Limited Roof Leaks
  • Central Air Conditioning
  • Ductwork

 

A Buyer or Seller may purchase a Home Warranty. Costs are competitive and run approximately $375.00 up to $400.00 depending also upon items covered and the deductible charge. Call Lentz and Fricke for more details at (888) REO-9404.

 



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