Main Office
3773 Cherry Creek North Drive, #575
Denver, Colorado 80209
Phone: 303.296.3666
Fax: 303.296.9996 |
TITLE INSURANCE
In Colorado, it is standard for the seller to provide the buyer with title insurance, which is an insurance policy that provides some protection to the effect that the buyer is actually receiving ownership to the property that the buyer expects.
After the parties are under contract, the seller will provide the buyer with a title commitment which is a statement by a title company confirming that they are prepared to issue title insurance (once their premium is paid and provided that they handle the closing so that they can be sure that all documents are property created, executed, and recorded).
The title commitment is intended to show all of the exceptions that exist to the title that the buyer will receive.
There are several standard exceptions to title. For instance, since taxes are paid in arrears (2006 real property taxes will be paid in 2007) there is always a lien on real property in favor of the county for unpaid taxes. This is a standard exception to title that all buyers will take title subject to.
Exceptions to title must be reviewed carefully. They may or may not be objectionable, but only if they are reviewed and understood will a buyer be able to evaluate whether there is a title issue to which the buyer should object.
A good example of a potential title issue to which a buyer might want to object is when a buyer is purchasing a town home or condominium and the Declaration of Covenants, Conditions and Restrictions that govern the use of the property and the maintenance of the common properties states that there shall be no pets on the property. If the buyer has pets, the buyer may have to object to title. If the seller cannot change that provision (and depending on the size of the development that can be a very difficult task) the buyer will have the right to terminate the contract. |
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