Entrepreneur of the Week - Post # 3: What is Teitel and Why Do Teitel Insurance.

#entrepreneurThis Week - Post # 3: What is Teitel and Why Do Teitel Insurance.
In most states in the United States, there is no official body like we have in the "taboo" country and the way in which assets, liens, mortgages, or any other property registration is done independently and fairly, without any control or verification, so the potential for errors, defects, unknown obligations, Fake or cheat, very high. To this end, title insurance has evolved in the United States, where in each state there are title agents or companies that issue, under the auspices of, underwriters, title insurance policies.
What exactly is this insurance and why is it important to have insurance? Property insurance, unlike other insurances you know like life insurance, vehicle, structure, and the like against insurers for future damage or loss, is retroactive insurance. That is, your property is insured against various problems in the previously owned conference property and the insurance is valid from the date of purchase of the property and the policy issue and as long as you own the property. As I mentioned, there is no system in the US like in the country where you can order a historical taboo form where you can see all the property history including costs, transfers, liens, etc. Therefore, the Teitel company does this work for you. In the first phase, the title company will order or prepare a title commitment for itself, which is the two-part very important pledge document. The first is a list of all the requirements and conditions of the underwriter, which must be fulfilled and / or canceled according to the data and information that came up from the review. For example, if the search revealed that you were on a mortgage property and could not locate a document proving to be foreclosure, one of the conditions would be a full settlement and a mortgage cancellation record.
Another example could be a problem with the chain of ownership and the way they went through the records. For example: a property that was owned by a husband and wife, but when they sold the property 30 years ago, only the husband signed a deed. Such a situation is a defect in ownership and cannot be given to a future buyer of property insurance. Problems such as these are referred to in the professional language - cloud on title and if they are not resolved or corrected this can cause you to lose the buyer and unable to sell a property with a “clean” title as required by the purchase agreement.
The job of the Teitel company or the Teitel agent is to make sure that there are no defects or problems that will prevent you from selling a clean Teitel to the buyer.
Of course, if any problem arises and can even be found by the Teitel or agent who made the previous transaction and issued a property insurance policy and require them to correct the defect. If the defect is not repairable, the insurance company can be sued under the policy. Pay attention? Because the insurance amount will always be at the purchase price you paid for the property. It is important to pay attention to the price of the net asset purchase, as stated in the closing statement, as opposed to cases where the price you actually paid is higher that also includes a renovation budget.
The second part of the commitment to issue property insurance is the Exclusion Chapter. That is, matters that are not insured and will not be sued if they arise later. For example: a right of passage, a connection to electricity, water, sewerage, common house regulations, and in some cases also invasions (targeting marked boundaries) to the lot, and unregistered debts.
Interest in unlisted debts has been rising over and over the years I have been in the field and representing investors. The issue is a significant problem that if not paid attention or not, investors may find themselves immersed in astronomical debt to the local authorities without even knowing the existence of the debt and, worse, For those to whom to turn. why? Because most, if not all of the Teitel companies do not perform unregistered liens and this is because unlisted liens are not considered in terms of the Taitel as a defect that prevents the transfer of clean ownership to the new owner and the insurance companies explicitly exclude such liens and liabilities from the policy. In most cases, this is a violation of such an immediate repairable area, for example, a violation of a local ordinance prohibiting the abandonment of abandoned vehicles in the home area, a requirement for the removal of dead vegetation, the cleaning of the driveway and the like. The problem starts when alerts for such violations are sent by mail to the address on the property appraiser's website and you do not live at (in most cases) but your tenant receives mail and does not always forward to you or your management company. The matter is not addressed, some notifications are not answered. Next, you will receive a summons for a hearing and if you do not sit down or who on your behalf does not appear for a hearing, a decision will be made in the absence of a attendance that is usually accompanied by a cumulative fine of $ XNUM per day for the full remedy of the violation, including the approval of a municipal examiner who has arrived at the property and has approved it. And all of this happens when you are not at all aware of the move and debt that is beginning to swell and swell. In many cases, you will discover the problem when you want to sell the property and the Teitel company making the deal will be a thorough and orderly company that always performs unregistered liens and a huge debt will be revealed to its towns. I cannot emphasize enough the importance of such an unrecorded lien search. I cannot list the amount of cases I have dealt with that I have found that investors have found themselves with debts that cost tens of times the value of the property.
Even if the title company tells you that it is not their responsibility or agrees to complete the closing subject to debts (since they do not insure against them anyway) my recommendation is to insist that the seller settle all debts until you receive confirmation that the debt has been settled (whether before the closing or within the closing, Whether in a compromise arrangement or otherwise) Do not close or agree to release trust funds.
I feel obligated to re-emphasize how critical this issue is and it is important that really many investors are unaware of these issues. So for your attention ...
In the next post I will go into more explanation and tips on the closing process itself and what this closing statement is.
Successfully!

Link to the original post in the United States Real Estate Forum on Facebook - Works on a desktop computer (To view the post must be members approved for the forum)

The original responses to the post can be read at the bottom of the current post page on the site or in the link to a post on Facebook and of course you are invited to join the discussion

• Great to read
• Great, thanks
• Very interesting, thanks. If you can add, Teitel is the job of another professional in every state (for example, in the state of New York, who plays the Teitel role is the lawyer who represents you in purchasing the apartment)
• If Nuisance was discovered on the property from the buy (currently recognized) that was about a week before closing on the total 600 $.
  And right now he can track the sale, is it worth suing / demanding compensation from the Teitel for such an amount?
• important information! Thanks!
• Thanks for the pleasure information to read 🙂
• Adam Maimon Omri Galili Eran Galili
• Thank you!
• What happens when violations and penalties are discovered on the pre-sale seller and the seller claims to have never encountered them? That is to say, neither his tenants in the property nor the management company updated him in the municipal audits, nor did the fines reach the "registered agent" or the address of the business?
• Is there a way to prove he got it?
  Was it that he knew or not, and not an affidavit, still responsible for him?