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What are the two essential elements of escrow?
A binding contact and conditional delivery of transfer instruments to a third party
What is the purpose of escrow?
To implement and sometimes supplement the original contract
What prevails if escrow instruction are in conflict with the original contract?
signed escrow instructions
When may a broker conduct an escrow?
Only when he is a party to the transaction and has an escrow company as part of the brokerage
What action can an escrow holder file to force the litigation of disputes?
An interpleader action
Escrow are voluntarily completed by what two things?
- Full performance or
How are escrows terminated?
By mutual consent or by cancellation
Does a cancellation of escrow cancel a purchase contract?
What is proration?
the proportional assessing, distribution or division of something
What do prorated items in escrow usually refer to?
recurring costs such as taxes, insurance, interest, HOA dues
What is a short rate?
It refers to a less than prorated refund when an insurance policy is cancelled early in its term.
What is an abstract of title?
It is a summary statement of successive conveyances and other facts by which a chain of title is established.
What is the most common type of title insurance?
A Standard Policy of Title Insurance
What does a standard policy of title insurance protect against?
- and the fact that a deed was not delivered
Why was an American Land Title Association Policy of Title Insurance developed?
what does it additional insure?
- To protect non-resident lenders (out of state) and to expand the risks.
- survey and an on-site inspection
What has the American Land Title Association adopted?
an Owners extended coverage policy
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