Curious about appraisals, title insurance, or the closing process? Our FAQ page answers common questions about title searches, insurance coverage, refinancing, and legal protections. Whether you’re buying, selling, or refinancing, we break down each step to help you understand your rights and responsibilities with clarity and confidence.
Title Insurance & Escrow
What does title insurance protect me against legally?
Forgery, liens on the property, undisclosed heirs, fraud, and mistakes in legal documents
What are the steps in issuing a title insurance policy?
- Step 1: A title search is ordered
The buyer’s attorney will place an order for title insurance with a title company. The title company will then initiate a title search to find any mortgages, deeds, easements, rights or restrictions, liens, or other land records that affect the property’s title. - Step 2: A title search is performed
A title insurance company will analyze the documents and records and evaluate their impact on the title to the property. - Step 3: A tile commitment is issued
After many examinations of the public records, a title commitment is prepared as the company’s agreement to insure the title on the property while also detailing the amount of insurance, exceptions, and requirements for the final policy to be issued. - Step 4: Title defects are cleared by the seller
If any title defects are identified then the title officer will collaborate with sellers, buyers, lenders, and their attorneys to resolve any issues. - Step 5: Closing and premium payment
The borrower/buyer pays the premium at the closing. The closing will most likely take place at the office of the attorney or title company.
Who pays for title insurance?
Potential homebuyers typically cover the expenses for the lender’s title insurance policy, which is mandatory for most lenders. This cost is commonly part of the closing expenses when buying a home. Homebuyers also have the option to buy owner’s title insurance for their protection. Occasionally, sellers may offer to pay for owner’s title insurance to encourage potential buyers further. The regulations concerning who pays for owner’s title insurance can vary by state.
What is a title search?
A title search is a thorough investigation of a property’s historical records. These include deeds and court documents to ensure the seller has the right to sell and to uncover any issues, like claims or defects, that might affect the property’s ownership.
Why do I have to purchase title insurance for the bank again when refinancing my home?
The title insurance you initially purchased was meant to protect the bank that lent you the money from anything that has occurred in the past. However the insurance you purchase when you refinance protects the bank from the date you last refinanced to the present. A “reissue rate” will be applied when you refinance to discount the premium lower than your initial payment.
Appraisal Services
How do you determine the value of a home?
The real estate appraisers of The Jordan Real Estate Group are trained property valuation professionals. Subscription to all local MLS services, online flood and tax databases, coupled with state-of-the-art appraisal technology allows for fast, accurate appraisals. Our appraisers live in the communities where they work, allowing for extensive market knowledge and ensuring accurate property valuations.
Are your real estate appraisals Appraiser Independence Compliant?
All residential real estate appraisals done by The Jordan Real Estate Group are Appraiser Independence compliant and come with the The Jordan Real Estate Group Appraiser Independence seal of approval.
What is current market value or fair market value?
Fair market value is defined as:
“The most probable price in terms of money that a property should bring in a competitive and open market under all conditions requisite to a fair sale, assuming a buyer and seller, each acting prudently, and assuming the price is not affected by undue stimulus.”
Conditions include:
- Buyer and seller are typically motivated.
- Both parties are well informed and acting in their own best interest.
- A reasonable time is allowed for exposure in the open market.
- Payment is made in cash in U.S. Dollars or comparable financial arrangements.
- The price represents a normal consideration for the property sold, unaffected by special financing or concessions.
Examples of transfers NOT considered fair market sales: Foreclosure Sales, Distress Sales, Relocation Sales, Estate Sales, Non-Arm’s Length Transactions, and Illegal “Flip” transactions.
Why wouldn’t the appraiser include the finished basement in the room count or square footage of my appraisal?
Per Fannie Mae guidelines, all rooms below grade are considered basement area and cannot be included in the above-grade square footage or room count. This does not mean the basement finish and amenities are ignored—they are considered in the “Basement” sections of the Market Analysis and Cost Approach.
What if a bedroom does not have a closet?
Many believe a room without a closet cannot be called a bedroom. Not true. Older homes often lacked closets. The appraiser will consider the lack of a closet as Functional “Curable” Obsolescence. If a closet can be built for $500, the benefit outweighs the detriment.
What is a Cost to Cure?
When appraising a property, the appraiser considers all positive and negative features impacting the Opinion of Value. Deferred maintenance lowers value. A competent appraiser calculates repair costs to bring the property up to neighborhood standards, including materials and labor—even if the borrower plans to do the work themselves.
The professional appraisers at The Jordan Real Estate Group analyze all market factors and provide a well-supported Opinion of Value.
What is a Recertification of Value?
The term “Recertification of Value” is outdated. Order an Appraisal Update to obtain a report stating the prior value is still accurate.
What is a Short Sale?
A short sale occurs when the lender accepts a reduced mortgage payoff because the property value is less than the mortgage amount.
Are short sales fair market sales? Yes and no. A few in the area are not typical, but if the market is dominated by short sales, they become valid comparables. Lenders usually require an appraisal before agreeing to the short sale price.
Why is your underwriter asking for current listings?
Underwriting now requires pending sales and active listings to show market trends—not just closed sales. If prior sales show $300,000 but current listings are $280,000–$290,000, the market value cannot be $300,000.
Appraisals reflect what a property could sell for on the effective date of the appraisal—a snapshot in time.
What does Days on Market (DOM) mean?
DOM is the length of time a property sits on the market. It’s used to analyze marketing time but is not always reliable because properties are often re-listed to appear “fresh.” DOM data can be misleading.
How do supply and demand affect the value of a home?
Supply = available inventory.
Demand = number of buyers willing to purchase.
Buyer/seller behavior has changed—bidding wars are rare, and sellers cling to past values. High LTVs and declining values complicate sales.
Our appraisers analyze supply, demand, and all market factors to provide a documented Opinion of Value.
Why does anyone care about absorption rate?
Absorption rate measures how quickly inventory sells based on supply and demand.
Example:
- Time Period: 12 Months
- Closed Sales: 48
- Absorption Rate: 4/month
- Active Listings: 30
- Months of Inventory: 7.5 (30 ÷ 4)
How is the “3S” guideline used for FHA standards?
- Salability – Preserve marketability
- Safety – Protect health and safety
- Security – Protect property security for FHA mortgage
Repairs are limited to those necessary for these factors.
