Talon Northwest Neighborhoods

Tideland definitions for Seattle area waterfront properties

You may have heard of several different terms describing Puget Sound tidelands in the Seattle area. This video from Talon's own Chief Title Officer, Tim Daniels, is dedicated to defining how these periodically submerged lands are labeled on a deed's legal description. We'll also touch on the different ways high and low tides are measured when determining boundary lines.

Gotta love the Talon eagle flying by in the background!

 

Title Insurance - more important than ever

Every so often, the American Land Title Association sends it's members "ready made" articles detailing the need for title insurance.  We wanted to share this latest article for anyone that would like a clear, well written piece that explains what it is and why buyers and sellers need it... especially in light of the times we're presently experiencing!

 

Title Insurance Vital to Protecting Homebuyers

As recently as this summer, some questioned the use of title insurance, suggesting it was an unnecessary expense when purchasing a home. Yet over the last few months, reports that paperwork in the foreclosure process could be invalid have raised questions about the validity of title to foreclosed properties and sparked fear that homeowners who purchased in good faith could possibly lose their home.

Today more than ever, consumers are reminded that in order to have peace of mind, they should purchase an owner’s title insurance policy whenever they buy a home. This is especially true when buying a property that has been foreclosed. Anyone who purchased an owner’s title insurance policy when they acquired a foreclosed property will be protected if ownership issues arise due to a lender’s foreclosure documentation practices. An owner's policy provides assurance that your title company will stand behind you if a covered title problem arises after you buy your home. The bottom line is that your title company will be there to pay valid claims and cover the costs of defending an attack on your title. Title insurance compensates and provides legal representation to real estate owners and lenders against any financial loss that might arise because of undiscovered liens, encumbrances or defects in the title to the property.  These defects can result in total losses, where a defective foreclosure or forgery means legal title is not actually conveyed, or they can result in partial losses where a neighbor’s garage or fence encroaches on the insured property...

 

link to the complete article in pdf format... Title Insurance

 

 

Sherrie Reed joins Talon as Seattle's newest title insurance Account Manager

The Talon Group is excited to introduce our newest asset to Seattle area real estate professionals! Sherrie Reed will be joining our Seattle sales team on Monday, May 16th.

Many real estate veterans will remember Sherrie from when she supervised Property Information departments in King and Snohomish counties from 1991-2002. Since then, Sherrie dramatically increased her expertice in our industry. Before moving back to Seattle, she performed the duties as President of a family owned title agency providing services across seven southern states! 

Sherrie pactices what she preaches when it comes to the value of education and networking. She is certified to teach several Washington State clock hour approved courses including 1031 Exchange, Title Insurance, Escrow Processes, and Sales & Marketing. Business To Business networking is another avenue that Sherrie believes is essential to building strong ties in a competitve market such as Seattle.

We're confident Sherrie Reed's qualifications will prompt you to raise the bar for what to expect from a title & escrow representitive.

  

 

Title Insurance ROCKS!

At The Talon Group, we take your compliments seriously.  Watch Chief Title Officer Daniels as he reacts to a recent tweet sent by a another happy client from the Seattle area!  

 

 

You never know just how much positive impact your compliments may have on someone...

ALTA Homeowner's Policy of Title - Deductibles and limits on liability may apply

There is virtually no question amongst real estate professionals that the ALTA "Homeowner's" Policy provides superior coverage as compared to the current standard owner's policy. Now that it's listed as the default policy on our local MLS purchase and sale agreements, it's important to understand a few of the limitations built into it's coverage.

Here's a list of some great coverages the Homeowner's Policy offers along with the limitations placed on liability:

An insured homeowner is forced to remedy or remove any part of their fixed structures (not including fences or boundary walls) because any part of it was constructed without a proper building permit.

• Coverage: liability is limited to a maximum dollar amount of $25,000 
• Deductible: either 1% of the policy amount* or $5000, whichever is less.

Insured is unable to obtain a building permit; is required to correct/remove a violation; or someone else refuses to perform a contract to purchase/lease/make a mortgage because of an existing violation of a subdivision law or regulation affecting the land.

• Coverage: liability is limited to a maximum dollar amount of $10,000
• Deductible: either 1% of the policy amount* or $2,500, whichever is less.

The insured homeowner is forced to remove or remedy their existing structure or any part of due to violation of an existing zoning law or zoning regulation.

• Coverage: liability is limited to a maximum dollar amount of $25,000
• Deductible: either 1% of the policy amount* or $5,000, whichever is less.

An insured homeowner is forced to remove their existing boundary walls or fences because they encroach onto the neighbor's land. 

• Coverage: liability is limited to a maximum dollar amount of $5,000
• Deductible: either 1% of the policy amount* or $2,500, whichever is less.

 

The Talon Group's goal is to educate our Puget Sound area consumers and help de-mystify the lesser known facts of title insurance. It should also be mentioned that there are many more great coverage features contained in the Homeowner's Policy that are not limited by caps or deductibles.   

* The policy amount is the dollar figure shown on Schedule A of the actual Homeowner's Policy issued after  closing for the particular property being insured. A 10% increase to the policy amount is calculated each year for the fist five years of ownership (up to 150% of the policy amount shown in Schedule A).   Photo by tandemracer

 

 

How to file a claim against a title insurance policy

As with most types of insurance claims, the time it takes to settle a title issue largely depends on the time it takes to gather all the relevant information that a Claims Officer needs to determine if coverage exists and then to calculate the appropriate settlement amount.

If you feel that you have a claim against your title policy, time is of the essence! We recommend that you promptly contact the issuing company to discuss the issues AND create a written statement with the following information:

• To the best of your ability, describe in detail all matters involved with the potential claim including names, dates, and a description of the covered risk (i.e. boundary dispute, mechanics lien, permit issue, etc.) A title professional from the original issuing company may be able to help you with the wording here.

• Include location information such as legal descriptions of the properties involved and if appropriate, the approximate description of any areas affected i.e. north 10 feet property line.

• List any monetary loss which you have expended or expect to expend as a result of the potential claim. If you're considering to hire an attorney on your own, keep in mind that the title underwriter reserves the right to choose any attorney they see fit for defending a legal action on your behalf. This is the case whether or not the title company even agrees their is a legitimate claim against the policy!

• Simply providing the policy number can also help in expediting the process.

The extent of coverage ultimately depends on the type of owner's coverage issued. If you are having trouble locating your copy of the Owner's Policy of Title Insurance, you can easily request a copy by contacting the title company that issued the preliminary commitment at the time of your original purchase. Can't remember who your title company was? Your real estate broker, lender or escrow company can also help you in locating this information.

The Talon Group's very own Dr. of Title, Tim Daniels, prescribes the virtues of claim prevention....

What are General Exceptions on a title report? Do they apply to all coverages?

It's common practice for title companies to list a number of exceptions on any particular title commitment or policy. General Exceptions are just that, a list of standard items to be excepted from an Owner's Policy unless removed by a method that is satisfactory to the issuing title company. Insurers rely on inspections, affidavits, lien releases, and indemnities to remove these general exceptions from a Standard Owner's Policy. Here's a very basic description of these types of exceptions:

• Boundary line discrepancies & encroachments
• Unrecorded easement claims
• Labor and/or material lien rights 
• Rights, interest, or claims of unknown parties in possession 
• Mineral & water rights
• Special assessments or taxes effecting property yet left off public record

An exception to this rule (no pun intended) would be if the selected title coverage ends up being beyond the Standard Owner's Policy.

Thankfully, the most widely used Purchase & Sale agreement provided by our local Puget Sound MLS calls for the most current  ALTA Homeowner's Policy as the default owner's coverage. This type of coverage essentially eliminates, or at a minimum, modifies the General Exceptions listed on the commitment. It's important to note that some of the coverages provided by this Homeowner's Policy are subject to deductibles and caps. This concept is relatively new to title insurance and still manages to surprise some of the most experienced real estate veterans!

A coverage that is rarely requested these days, Owner's Extended, eliminates all general exceptions to the policy. This coverage is not subject to any deductibles or caps as with the previously mentioned Homeowner's Policy but may be subject to an extensive ALTA survey before the title company agrees to issue the policy. The parties to the real estate transaction will typically negotiate who bears the cost for these, at times, expensive surveys.

Click on the image for a comparison of owner's title coverages!

 

 

 

 

 

Parties in Possession and other reasons we inspect properties...

These days, it's no secret that insuring certain types of properties can be risky business for title companies. Inspection reports are commonly used by title to reduce risks associated with insuring bank owned (foreclosed REO) and new construction type sales.

Title commitments list a number of general exceptions that need to be cleared from the report before an actual policy is issued. When insuring sales with bank owned property, "Parties in Possession" is one of those exceptions we pay special attention to... 

Any facts, rights, interest, or claims which are not shown by the public records but which could be ascertained by an inspection of said land or by making inquiry of persons in possession thereof.

Recent headlines have illustrated how squatters are making foreclosed properties their home for months or even years before the banks get around to selling them! At Talon, we make it a habit to have these properties physically inspected by Cramer Inspection Services Inc. While they're at it, we also ask them to report on any apparent encroachments, violations of restrictions, unrecorded easements, and practical access to the property.

Another common reason we order inspections is to protect against mechanics liens on new builder construction or any resale properties where we've been given clues of any construction projects that have either been started or recently finished (new garage, roof, additions, etc). We need to make certain contractors are paid for their work and therefore eliminate the chance of unrecorded lien rights. 

There's a few other scenarios that trigger inspections...

• High liability (commercial properties or really expensive homes!)
• Waterfront properties
• Any transaction where an Extended Coverage Policy is requested.
• Concern expressed by brokers, owners or neighboring properties. 

Here's a bit of good news to end this post, we rarely pass on inspection charges to our customers! 

 

 

 

 

Photo by somegeekintn

Right of Redemption for Washington State foreclosures?

Generally speaking, the answer is no. The majority of Washington State bank foreclosures are non-judicial trustee sales which only allow borrower reinstatement rights prior to the sale. However, there are instances in Washington State where lien holders use a judicial foreclosure process to recover debts. These debts are typically secured by a judgement or security document that don't include a Power of Sale clause.

Let's take a look at the most common scenario first. Non-Judicial foreclosures.

• A borrower has the right to reinstate the loan up through 11 days prior to the trustee sale. Reinstatement includes the passed due payments as well as any other expenses, attorney fees, trustee fees, etc. 
• The lender may upon it's own prerogative accept reinstatement from the borrower beyond the 11 day period prior to the sale.
• The loan may be paid off at any time before the trustee sale. The payoff calculation includes all additional fees incurred by the lender.
• Unless otherwise noted, the buyer has no redemption period beyond the trustee sale date.

Judicial foreclosures

• The borrower or judgment debtor may pay off the judgement prior to the home being sold at auction.
• A right of redemption typically exists for a period of 8 to 12 months* after the sale takes place. The typically cost of redemption equals the amount of the winning bid plus any additional "purchase" related costs incurred by the winning bidder.  

Which ever type of foreclosure property you're interested in buying, make sure to do your homework before handing over the check...there is no title insurance!

 

*Circumstances exist where redemption period is legally extended due to non-compliance of required notices.

2011 Property Taxes

Property tax season is upon us once again, and we've starting to get more and more questions about property taxes in general.  I'm going to list some links that people can find their information readily, along with some random thoughts and videos that I think will be helpful. 

King County now has local area data showing what the average improved valuation changes were YOY. You can go back historically til 2004 if you like.  If you're a stat geek like me, you'll find these stats interesting.  I'm not sure when they introduced this feature, but it's good stuff once you drill down a bit to the more local areas.

If you're wondering what your 2011 tax amounts will be, they should be posted mid month in February. Pierce County and Snohomish County should follow the same timeline and have their tax amounts posted mid month.  First half tax payments are due at the end of April.  

King County has some good FAQ's regarding how property taxes are done and calculated.  

People often times ask why their taxes go up, but their assessments have dropped.  For an answer to that, here's a Talon Video that we did in 2009.

Thanks everyone!

Photo courtesy of mild_swearwords