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Understanding Title Insurance

With all of the recent talk of improper foreclosures having taken place, and the issues with bank owned real estate title problems, the question of the need for title insurance has been a hot topic. I have always stressed the importance of purchasing an owner’s policy of title insurance. Regardless of who is selling the property, how long it has been in the family or how familiar you or the seller may be with the property you just never know (more…)

Buying an REO Property v. Foreclosure Auction Property

I have had a few clients ask me recently about the difference between buying a property at a foreclosure auction and buying a property owned by a bank (REO/Real Estate Owned).

A property purchased at a foreclosure auction or foreclosure sale is purchased through a bidding process by individuals at the auction. The property is sold to the highest bidder. If the foreclosing lender is not satisfied with the amount of the bids they may also bid on the property to raise the selling price. In the end the lender often ends up as the highest bidder and takes ownership of the property. Property that is acquired by the lender in this process is called REO property or Real Estate Owned property. The lender will in turn, eventually, place this property on the market with a Realtor for resale to the public. (more…)

Another Problem with Short Sales – The Short Sale Flip.

Title insurance underwriters, concerned about the risk in insuring short sale flips have taken a position of not insuring them.  Old Republic Title Insurance announced to it’s agents last month that it would no t authorize the issuance of lender or owner title insurance policies on short sale flip transactions.

So what is a short sale flip?

A short sale flip is when a property is purchased by a real estate “investor” from a seller who has negotiated with the current mortgage holder(s) to release the mortgage(s) for less than what is owed, the purchaser of the property then flips, or resells, the property for a profit. (more…)

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