Chapter 7 - Escrows and Title Insurance

Question 1

If a dispute arose during escrow regarding the distribution of funds, a broker might file an ________ ______.

Answer 1

interpleader action (court action)

Question 2

Is Southern California unilateral/bilateral?

Answer 2

Bilateral: escrow instructions are signed by both the buyer and sell rust after the start of escrow.

Question 3

Is Southern California unilateral/bilateral?

Answer 3

Unilateral: escrow instructions are given to the escrow officer just because the close of escrow.

Question 4

Escrow services in _______ California are traditionally performed by independent escrow companies (corporations) or financial institutions.

Answer 4

Southern California

Question 5

Escrow services in ________ California are traditionally performed by title insurance companies.

Answer 5

Northern California

Question 6

Escrow service fees in __________ California are usually split 50-50 between the buyer and the seller.

Answer 6

Southern California

Question 7

Escrow service fees in ___________ California are usually paid for by the buyer.

Answer 7

Northern California

Question 8

In __________ California, the seller pays for the California Land title Association (CLTA) policy (standard policy).

Answer 8

Southern California

Question 9

In ___________ California, the buyer pays for the California Land Title Association (CLTA) policy (standard policy).

Answer 9

Northern California

Question 10

In _________ California, the buyer pays for anything above the CLTA.

Answer 10

North and South

Question 11

________ is the process of proportionately dividing expenses or income to the precise date that escrow closes, or any other date previously agreed upon.

Answer 11

Proration; as with property taxes, fire insurance, interest and rent.

Question 12

If there is a Section I infestation damage (required work), it is usually paid for by the ________.

Answer 12

seller

Question 13

If there is only Section II potential for infestation damage (recommended work), the extent of repairs is up to ______.

Answer 13

both parties

Question 14

Every ___ and _____ loan application requires an inspection report.

Answer 14

VA and FHA loan application

Question 15

FHA and VA termite certificates and repairs are always paid for by _______.

Answer 15

The seller.

Question 16

The _____ Code requires that the broker shall deliver a copy of the Structural Pest Control Certification Report and Notice of Work Completed to the buyer, seller, and lender, if such a report is a condition of the purchase agreement or is a requirement imposed as a condition of financing.

Answer 16

Civil Code

Question 17

All information such as those in the recorder’s office, various tax agencies, federal court clerk and the Secretary of State concerning people and their real property is stored in computers (within a grantor-grantee index) and is referred to as a ______ ______.

Answer 17

Title Plant

Question 18

Title insurance is paid once and includes:

Answer 18

• a search of records
• examines “off” record risks
• interprets legality of records
• insures against economic loss

Question 19

Easements, encumbrances and liens that are not shown by public record are also not included in the _____’s standard policy.

Answer 19

CLTA, California Land Title Association

Question 20

The ALTA stands for

Answer 20

American Land Title Association

Question 21

The ______ standard title insurance policy does NOT require an on-site inspection, but an ____ extended policy does.

Answer 21

CLTA; ALTA

Question 22

ALTA-R Policy _____ include a survey because the property lines are already established by a recorded subdivision map.

Answer 22

Does not

Question 23

In _______ California, it is customary for the seller to pay the title fees, whereas in _______ California it is usually the buyer who assumes the cost. This is just for the standard CLTA policy.

Answer 23

Southern; Northern

Question 24

RESPA stands for _____________ and is enforced by the HUD.

Answer 24

Real Estate Settlement Procedures Act

Question 25

Under RESPA, a lender has _____ business days from the date the lender receives the borrower’s loan application to provide a booklet entitled “Settlement Costs and You.”

Answer 25

three business days

Question 26

The seller may request a specific title insurer, but only the _____ can require a specific insurance company.

Answer 26

buyer

Question 27

Escrows are required for….

Answer 27

1. Liquor License Transfers
2. Security Sales (Impound Accounts)
3. Court-Ordered transfers (Probate Sales)