Escrow & Title
In Hawaii, the 'title search period' in escrow is used to:
AA. Market the property to potential buyers
BB. Search public records for any title defects, liens, or encumbrances that must be resolved before closing✓ Correct
CC. Allow the buyer to conduct their property inspection
DD. Negotiate loan terms with the lender
Explanation
During the title search period, the title company searches public records to identify any liens, encumbrances, or defects affecting title, allowing time to resolve issues before closing.
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Key Terms to Know
Encumbrance
Any claim, lien, charge, or liability attached to real property that affects its value or limits its use.
LienA financial claim against a property that serves as security for a debt or obligation, giving the creditor the right to foreclose if unpaid.
EscrowA neutral third-party arrangement where funds, documents, and instructions are held until all conditions of a real estate transaction are satisfied.
Title InsuranceInsurance protecting against financial loss from defects in a property's title that existed before closing but were unknown at the time of purchase.
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