Process and Procedure Issues

Title Insurance

Most kinds of insurance are self-explanatory. They protect against losses from events that might occur in the future such as fire, theft, or collision. Title insurance,however, is different. Title insurance protects against defects in title that may arise from events that occurred in the past.

You should know that whenever you buy property, that the owner who is selling it to you has extremely strong rights, as do his family and heirs. Also, there may be others, in addition to the owners, who have rights in the property you are going to buy. These may be governmental bodies, contractors, or individuals who have unpaid claims against the property.

Anyone who has such a claim is, in a sense, a part owner. The property may be sold to you without the party who has such a claim knowing about the sale. Likewise,you may know nothing about such a claim at the time you buy. It doesn’t matter.These claims may remain attached to the real estate you have purchased. The process of title insurance is to protect you from these types of problems.

Will you get a clear title? It is of the greatest importance that you do. This means that you must be informed about any of the claims against the property so that you can make certain they are cleared up before you buy. That means you must be protected against any undiscovered claims that may arise in the future that may threaten your title and the possession of your property. Title insurance provides this twofold protection.

You learn what claims there are against the property by a search of the public records. This is the first step the title insurance company takes in order to insure your title. Some of the things a title search uncovers are any unpaid taxes or mortgages; judgments against previous owners, easements, and any court actions or recorded documents, which can affect title to real estate. The title insurance company finds and reports such defects in title so that these matters can be corrected and cleared up.

Surveys and Improvement Locations Certificates (ILC)

The land survey plat includes a scale drawing of the boundaries of a parcel of land which is complied by a series of exact and precise linear and angular measurements taken from a known point of origin developed by mathematical principals of surveying. The purpose of the land survey plat is to determine, locate and/or restore any real property boundaries. The land survey plat will also indicate any conflicting boundary evidence and any recorded and/or apparent rights-of-way or easements.

The improvement survey plat is comprised of the same precise information as the land survey plat mentioned above, and, in addition, indicates the location of all structures and improvements situated on the parcel of land. The improvement survey plat will also show visible encroachments. It will show any fences, hedges,or walls on or within two feet of both sides of all boundaries. The improvement survey plat will show the location of all visible above ground utilities, and all underground utilities for which there is visible surface evidence.

The ILC (improvement location certificate) is another method of describing and approximately locating a property and is often required by lenders and insurance companies. It offers certain reasonable assurances regarding potential boundary or encroachment problems that may affect their interests. It also illustrates the location of improvements and conditions of the property. However, it is based on assumptions regarding boundary location and is not a precise survey. The improvement location certificate is typically used in the purchase of single family residential property located within the established subdivided urban and suburban areas of Colorado.

What The Improvement Location Certificate IS:

a. It is a representation of boundaries and improvements based on a surveyor’s general knowledge of a given area.

b. It is a depiction of the property boundaries showing the size and shape of a parcel which is based on the legal description provided in the warranty deed.

c. It is a document that must be signed and sealed by a professional land surveyor who has certain professional responsibilities for its accuracy.

d. It is a representation of the location of improvements, encroachments, and easements based on their relationship to a reasonable estimate of the location of property lines.

What The Improvement Location Certificate is NOT:

a. It is not a survey.

b. It does not locate exact boundaries.

c. It does not establish property corners.

d. It is not to be legally relied upon for locations of property lines or future improvements.

Sometimes the improvement location certificate will indicate a possible encroachment or some other evidence of a boundary dispute. In this case, a true survey, (i.e.improvement survey plat or or land survey plat) would be required to clarify or resolve any discrepancies before you buy your Boulder real estate.

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