Escrow & Title
A lender's title insurance policy (loan policy) in NC protects:
AThe buyer's equity in the property
BThe lender up to the outstanding loan balance✓ Correct
CBoth buyer and lender for the full purchase price
DThe title company against errors
Explanation
A lender's (mortgagee's) title insurance policy protects the lender up to the outstanding loan amount against losses from title defects. It does not protect the buyer's equity.
People Also Study
Related North Carolina Questions
- A lender's title insurance policy (mortgagee's policy) in North Carolina:Escrow & Title
- In NC, 'gap coverage' in a title insurance policy protects against:Escrow & Title
- A lender's title insurance policy in NC protects:Escrow & Title
- An owner's title insurance policy in North Carolina protects:Escrow & Title
- If a property is appraised at $325,000 and the lender requires 20% down, what is the maximum loan amount?Real Estate Math
- Under NC's NC Offer to Purchase, who is responsible for paying the buyer's closing costs (loan origination fees, title insurance, etc.) by default?Contracts
- A lender requires a maximum 80% LTV on a conventional loan. The appraised value is $350,000 and the purchase price is $340,000. What is the maximum loan amount?Real Estate Math
Key Terms to Know
Title Insurance
Insurance protecting against financial loss from defects in a property's title that existed before closing but were unknown at the time of purchase.
Loan-to-Value Ratio (LTV)The ratio of a mortgage loan amount to the appraised value or purchase price of a property, expressed as a percentage.
Closing CostsFees and expenses paid by the buyer and/or seller at the closing of a real estate transaction, in addition to the property's purchase price.
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.
Math Concepts
Study This Topic
Practice More North Carolina Real Estate Questions
1,500+ questions covering all exam topics. Start free — no signup required.
Take the Free North Carolina Quiz →