Escrow & Title
An owner's title insurance policy in NC protects:
AThe lender against losses from title defects
BThe buyer/owner against losses from title defects existing prior to the policy date✓ Correct
CBoth buyer and lender equally
DThe seller after closing
Explanation
An owner's title insurance policy protects the buyer/owner against losses from title defects or claims that existed prior to the policy date, such as undisclosed liens or forgery in the chain of title.
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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.
Chain of TitleThe sequential record of all transfers of ownership for a piece of property from the original patent holder to the present owner.
LienA financial claim against a property that serves as security for a debt or obligation, giving the creditor the right to foreclose if unpaid.
Discount PointsPrepaid interest paid to a lender at closing to reduce the mortgage interest rate, with each point equal to 1% of the loan amount.
Math Concepts
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