Escrow & Title
In South Dakota, a 'gap exception' in title insurance refers to:
ACoverage gap between policy issuance and recording✓ Correct
BA gap in the chain of title (missing link in the ownership history)
CThe time gap between policy application and funding
DCoverage that excludes environmental hazards
Explanation
A gap exception covers the period between the title search date and the recording date. Title companies provide gap protection to ensure no liens or claims are recorded in that interim period.
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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.
Abstract of TitleA condensed history of a property's title, summarizing all recorded documents and encumbrances affecting it from the earliest record to the present.
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