Page 153 - Trump University Commercial Real Estate 101

Ho w to Disco ver the Truth behind a Deal

seller. She also handles the earnest money deposit, loan documents,
and closing fees that are associated with the title transfer.
The escrow agent will obtain title insurance, pay off any outstanding
liens, cut checks to any other parties, and record the property deed
after the closing.

Should You Get Title Insurance?

Title insurance protects you against any defect in the title that might
be pointed out during your ownership of the property. You might be
thinking: “ Hey, I just paid the attorney to check the title and he told
me it was clear. ”
What if the attorney missed something? What if someone puts in
a claim at a later date for a matter that the attorney could not have
seen at the time?
Some years ago I negotiated a nice deal and was moving ahead to
the closing. I had done the due diligence, my checklist was empty, the
loan commitment was in place, and the title came back clean.
I was two days away from the closing when I got a call from the
local police department, asking if I was about to purchase the property
in question.
I said “ Yes. ” The detective asked me for the seller ’ s name and I
gave it to him. He then informed me that this person did not own the
property, and that the actual owner lived in Florida and knew nothing
about the sale!
The police had discovered that my seller had falsified a deed and

recorded it at the registry of deeds, transferring the property into
his name.
When my attorney did the title search, the transfer looked clean.
In fact the attorney certified that the title was clean!

Another lesson for you: Attorney certifications are not the same as
title insurance. You might get a heart - felt apology from the attorney,
but the only way you ’ ll get your money back is if you fi rst obtain title
insurance.

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