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Frequently Asked Questions

What is a title commitment? What does it have to do with a chain of title?

A title commitment costs around two hundred dollars and is a document prepared by the title underwriter which states that if certain requirements are met then the title underwriter will insure the property.  Here, at Rock Solid Title, we use the Attorney’s Title Fund Services, LLC, also known as the Fund.   The chain of title shows that certain transfers have been done to transfer property from one person to another to show good title.  This is a Seller’s cost to show the Buyer that the Owner has good title to the property that the Owner is selling.  A title commitment is needed for a refinance as well as a title closing.

What is the inspection period in a contract? What repairs need to be made in an inspection period? Is the contract canceled if repairs are not made?

The inspector is hired by the Buyer to determine what repairs need to be made for the house to match the expectations of the home. It is usually for a time period of ten days. The contract can be cancelled at any time of inspection due to repairs not being made or not agreeing to pay the cost of repairs during negotiations.

What is a lien search?

At Rock Solid Title, we obtain the lien search for the closing.   A lien search, F.S. Chapter 159, is typically required to remove exceptions when issuing title insurance policies and is paid for by the Seller.  It usually costs around $200, shows unrecorded liens, fees, code violations, and shows similar permit violations attached to the property.

What is a survey?

At Rock Solid Title, we obtain the survey for the closing.  A survey is the layout of a property.  It maps the legal boundaries and other features of a property that may be needed to solve disputes in a real estate transaction.  A boundary survey is usually needed when purchasing a stand-alone home.  Surveys can sometimes be updated by a surveyor.  Surveys are needed to determine if the property is in a flood zone.  Land surveys cost $400 to $600 and are paid for by the Seller.  Surveys are needed by a refinance as well.

The Buyer pays for the Survey.

What is a closing disclosure (CD) or HUD?

This five (5) page settlement statement shows all of the costs and expenses associated with the closing.   The purchase price, the subject mortgage loan, interest rate, taxes, loan fees, title fees and other closing costs and expenses.   It shows who, Seller or Buyer, has to pay the different expenses associated with the closing.  The closing disclosure has to be provided 3-days prior to closing.

What are the three protections of homestead? Can you disclaim, waive or quitclaim your homestead interest?

At Rock Solid Title, we inform the Owners of the importance of applying for homestead protection for their residence. 

Homestead is real property to the extent of no more than one-half of an acre of contiguous land in a municipality, owned by a natural person, and the improvements on it.

The property must be your permanent residence or the permanent residence of someone you can claim as a dependent on your taxes.  You must be living the home as of January 1st of the current tax year.  You must not have rented your homesteaded property for more than 30 days during a calendar year.

  1. Protection from judgment creditors and from levy – it cannot force the sale due to the house being homesteaded and a cap on the annual increase in property tax assessments at 3% or the annual Consumer Price Index (CPI)
  2. Decrease in Property Taxes – can claim up to a $50,000 homestead exemption on your primary residence
  3. For inheritance purposes – inures to your spouse and minor children

What is a non-identity affidavit? Why does my name show up in multiple ways for me to obtain this loan?

A non-identity affidavit is an affidavit which shows the different names that are associated with the Buyer.

What is an estoppel?

An estoppel is supplied by the condo association or the homeowner’s association showing which maintenance and special assessment fees have been paid.  The Seller pays for the estoppel and the cost of the estoppel is usually two hundred fifty ($250.00) dollars.

What are Y-grene fees?

Y-grene fees are paid through the annual tax bill, and are used for home maintenance projects like hurricane windows or a new roof.  Also called Property Assessed Clean Energy (PACE) Program.  When the property is sold, the PACE loan needs to be paid off.

The non-ad valorem taxes increase almost three times due to the loan.  The PACE loan is paid off by the non-ad valorem taxes.

Why do I need a lawyer in a real estate closing? I have a realtor to represent me in the transaction, do I really need a lawyer?

A lawyer is needed to review the contract to protect the parties in the transaction. The lawyer for the Seller reviews the title commitment and provides the documents needed to clear the title and the Seller documents such as the Warranty Deed, Bill of Sale, Closing Affidavit, and the No lien and GAP affidavit.

The Buyer’s attorney in Miami-Dade and Broward county usually deals with the title work, and the Buyer’s attorney in Palm Beach deals with the title work.

Why are realtor’s fees so high and who pays them?

There are realtor’s fees paid by the Seller that are agreed upon, but are usually 3% each side or 6% together. There is also usually a Buyer’s administrative fee placed by a Brokerage.

The realtor does all of the marketing and negotiating on the price to get the property sold. The realtor holds Open Houses and spends countless hours on showing the property.

Who pays for the appraisal? Do I really need an appraisal?

The appraisal is paid for whoever wants the appraisal.  Most times the lender wants to protect their loan and appraises the property.  The Seller and Buyer then negotiate on price based on the appraiser’s estimate.  Most times it is important for a Buyer to get an appraisal to get a valuation of the property that the Buyer is paying for the property.

What is title insurance? Is the title insurance transferred to an LLC or a revocable trust If the sole owner transfers the property to an LLC or revocable trust?

There are two different types of insurance: Lender’s title insurance and owner’s title insurance.

The Lender’s title insurance protects the loan and the financial institution for the money provided to purchase the house.

The Owner’s title policy is protecting the owner for the valuation of the house.

What is the FIRPTA affidavit? When is the FIRPTA affidavit used?

FIRPTA is the Foreign Investment in Real Property Tax Act of 1980 (FIRPTA).  It protects the United States from foreign investors making money off of the realized sale.  Ten percent (10%) of the purchase price be withheld before February 17, 2016. FIRPTA is when the Sellers of the real property are not United States citizens.  Tax will need to be withheld of ten percent (10%) of the purchase price.  FIRPTA authorized the United States to tax foreign persons on dispositions of U.S. real property interests.  The rate of withholding generally is 15% (10% for dispositions before February 17, 2016).

A foreign corporation that distributes a U.S. real property interest must withhold a tax equal to 21% of the gain it recognizes on the distribution to its shareholders.

Can I Docusign my closing documents? Are electronic notaries allowed?

Documents usually can be electronically notarized with Notarycam or Notarize, but it is dependent on the lender for a mortgage financed closing.

For a cash-deal closing, then the documents can be electronically signed and notarized through Notarycam or Notarize. They can be electronically signed with Docusign, and for any affidavits like the closing affidavit, an electronic notary provider like Notarycam or Notarize can be used.