If you are a Buyer and are obtaining a loan, the lender is NEVER going to send over the closing funds until they have a CPL as well. So as you can see there may be three to four (or more) CPL in an Escrow. These are highly recommended for both the Buyer and Seller. As I have stated, your lender will require it.
What is a closing protection letter?
A closing protection letter (sometimes “insured closing letter” or “CPL”) forms a contract between a title insurance underwriter and a lender, in which the underwriter agrees to indemnify the lender for actual losses caused by certain kinds of misconduct by the closing agent.
Does closing protection letter expire?
A closing protection letter is a contract between a title insurance underwriter and a lender. … It is good for 1 year from the date of the letter. However, transaction specific information such as the loan amount, name of parties, etc.
How much is closing protection coverage?
The Closing Protection Letter fee is $25 for each party protected. More specifically, $25 for a Lender CPL when there is a mortgage in either purchase or refinance transactions. $25 for a Buyer CPL in all purchase transactions.
What is closing or settlement protection?
In a Closing Protection Letter, your underwriter agrees to reimburse the addressee if your title agency is guilty of fraud or dishonesty in handling the closing money or documents, which courts have said covers more than just theft of the loan money, or if you fail to follow certain written closing instructions.
What is a settlement fee at closing?
The title settlement fee, or closing fee, is a charge from the title company to cover the administrative costs of closing. Title companies may or may not list out the individual costs of the fee.
Are closing Protection Letter mandatory in Indiana?
As of July 1, 2013, title insurers in Indiana will be required to issue Closing Protection Letters (CPLs) not just to lenders, but also to buyers, sellers, and owners in a refinance, on all residential transactions. … The CPL coverage is separate from the coverage of the title insurance policy.
What does a real estate closing agent do?
For a real estate transaction, closing agents are professionals who function chiefly for the buyer by conveying the selling interest from the buyer to the seller and ensuring the orderly transfer of the legal title from the seller to the buyer through the closing process.
What is offer of closing protection coverage?
A CPL frees the lender from liability caused by fraud on the closing agent’s part, error, or negligence in complying with the terms of a real estate transaction. This means that the title insurance company or closing agent has agreed to cover the cost of misappropriated funds.
Is a closing protection letter required in Pennsylvania?
The settlement company will require a Closing Protection Letter (CPL) from your lender. This document and fee ensure that the settlement company will handle the transaction with care and integrity or else reimburse the lender. The Pennsylvania Department of Insurance sets the $125 CPL fee.
What is a title binder?
Title binders are temporary is a form of temporary real estate insurance used during ownership transfer. Title binders protect the buyers and sellers during transfer—i.e. times when there might be a gap in the buyer’s or seller’s home insurance policy.