Escrow & Title
In a Mississippi real estate transaction, a title commitment (binder) is issued by a title insurance company to:
AGuarantee that the property is free of all liens
BDescribe the condition of the title and list exceptions prior to issuing a final title insurance policy✓ Correct
CTransfer ownership from seller to buyer
DEstablish the escrow account for the transaction
Explanation
A title commitment (or binder) is a title company's agreement to issue a title insurance policy after the closing. It describes the current condition of title, identifies parties who must sign deeds, and lists exceptions that will appear in the policy.
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Key Terms to Know
Deed
A written legal instrument used to transfer ownership of real property from one party (grantor) to another (grantee).
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.
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.
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