Escrow & Title (alternative)
A Maryland title company that detects a 'cloud on title' before settlement should:
AProceed with settlement and note the issue in the policy
BRequire the cloud to be resolved or insured over before issuing a clear title policy✓ Correct
CReport the issue to MREC
DReduce the title insurance premium to reflect the risk
Explanation
A cloud on title (any recorded claim that casts doubt on the owner's clear title) should be resolved before settlement. The title company may require curative action or refuse to insure over certain issues.
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