Frequently Asked Questions

1. What is title insurance for a residential property?

It’s a one-time premium policy that protects homeowners and lenders against loss due to title defects, such as prior ownership claims, unpaid liens, or filing errors.

2. What’s the difference between a lender’s and an owner’s policy?

The lender’s policy protects the bank’s interest in the property and is usually required if you're taking out a mortgage. The owner’s policy protects you as the buyer — and is optional but highly recommended.

3. What happens during a title search?

We examine public records to identify:

Legal owner of the property

Open mortgages, liens, or judgments

Easements or restrictions

Unpaid taxes

Pending lawsuits involving the property

4. Can I choose my own title company?

Yes. Even if a lender or real estate agent recommends one, you have the legal right to choose your own title company.

5. What is included in closing costs?

Typically:

Title insurance premiums

Title search and examination fees

Government recording charges

Transfer taxes (if applicable)

Attorney or settlement agent fees

6. How long does it take to close on a residential property?

On average, 30 to 45 days from contract signing. It may be faster for cash deals and longer for complex financing or if issues arise during the title search.

7. What if a title problem arises after closing?

If you purchased title insurance, your policy will provide legal defense and financial coverage up to the amount of the policy for covered risks.

8. I’m buying a condo/co-op — do I still need title insurance?

Yes, especially for condos. For co-ops (technically a stock purchase), title insurance may not apply in the traditional sense, but a UCC (Uniform Commercial Code) lien search and cooperative attorney review is strongly recommended.

1. What are the most common issues that delay or derail commercial real estate closings?

• Unreleased liens or prior mortgages: Prior debts not properly discharged can cloud title.
   
• Entity documentation issues: Buyers or sellers may not have operating agreements, resolutions, or certificates of good standing in order.
   
• Survey disputes: Lack of an updated ALTA survey or discovery of boundary encroachments.
   
• Zoning conflicts: Property use may not comply with current zoning, especially in redevelopment or adaptive reuse.
   
• Undisclosed leases or tenant rights: Existing leases may have ROFR (right of first refusal), purchase options, or long-term terms not disclosed upfront.
   

2. Are commercial buyers required to get a new survey? Why is it so important?
While not always required, lenders often insist on a current ALTA/NSPS Land Title Survey. This survey identifies:

• Property boundaries and building locations
   
• Recorded easements and access points
   
• Encroachments (fences, structures)
   
• Utility lines and rights-of-way
  It directly impacts what title coverage can be issued. If a survey isn’t current or doesn’t reflect the intended use, coverage may be limited, and closing may be delayed.
   

3. Can I close under an entity name (LLC, Corp), and what documentation is needed?
Yes, but you’ll need to provide:

• Articles of Organization/Incorporation
   
• Operating Agreement or Bylaws
   
• Certificate of Good Standing (usually dated within 30 days of closing)
   
• Resolution or consent authorizing the transaction
  Without these, the title company can’t verify signing authority, and the transaction may be delayed. This is especially critical when multiple investors or complex entity structures are involved.
   

4. What are common title issues in commercial transactions?

• Unreleased liens or mortgages
   
• Encroachments and easements
   
• Zoning violations or land use restrictions
   
• Mechanic’s liens from unpaid contractors
   
• Problems with prior conveyances (e.g., missing signatures, misfiled deeds)
  These risks are heightened in commercial deals due to property history, past developments, or long-term leases.
   

5. What is an ALTA Survey and why is it often required?
An ALTA (American Land Title Association) survey is a detailed map of the property that includes improvements, easements, boundaries, access points, and encroachments. It is often required by lenders and title insurers to determine insurability and ensure the buyer receives full rights to intended usage.

6. What endorsements might be needed in a commercial title policy?
Depending on the transaction, your lender or buyer's counsel may request:

• ALTA 9 (Comprehensive)
   
• Zoning (ALTA 3 series)
   
• Access & Entry (ALTA 17)
   
• Contiguity, tax parcel, subdivision endorsements
   
• Leasehold-specific endorsements (ALTA 13.1, 13.2)
   

7. Can Tower Abstract insure leasehold interests or ground leases?
Yes. Tower Abstract has experience insuring both fee and leasehold interests. Leasehold transactions require specific endorsements and review of the ground lease agreement, particularly for term, rent escalations, and default provisions.

8. What do I need to provide to begin the commercial title process?

• Executed contract or LOI
   
• Entity documentation (LLC or corporate documents)
   
• Existing or prior title policy (if available)
   
• ALTA survey or previous surveys
   
• Contact information for attorneys, lenders, brokers, and principals