Escrow & Title
In Michigan, who is responsible for selecting the title company for a purchase transaction?
AAlways the lender
BEither party; it is subject to negotiation✓ Correct
CAlways the seller since they provide title
DAlways the buyer since they purchase the insurance
Explanation
In Michigan, the selection of the title company is negotiable. RESPA prohibits requiring parties to use a specific title company as a condition of the loan, so buyers have the right to choose their title insurer.
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Key Terms to Know
Easement
A non-possessory right to use another person's land for a specific purpose.
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.
ContingencyA condition in a purchase contract that must be satisfied before the sale can proceed to closing.
Option ContractA contract giving the buyer the right, but not the obligation, to purchase a property at a specified price within a specified time period.
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