Escrow & Title
Vermont's 'affidavit of title' provided by the seller at closing:
AReplaces the need for title insurance
BCertifies that the seller has not created encumbrances not disclosed in the title search, such as unrecorded leases or recent work✓ Correct
CConfirms the property's assessed value
DGuarantees the property will pass inspection
Explanation
An affidavit of title is a sworn statement by the seller certifying that they have not created any additional encumbrances (unrecorded leases, recent construction) since the title search was completed, protecting the buyer and title insurer.
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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.
EncumbranceAny claim, lien, charge, or liability attached to real property that affects its value or limits its use.
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.
Private Mortgage Insurance (PMI)Insurance required by lenders on conventional loans with less than 20% down payment, protecting the lender — not the borrower — against default.
Math Concepts
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