Legal FAQs for REALTORS® — Title Issues
Seller Financing

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My client is purchasing a property by means of seller financing. I know that lenders require a mortgagee, or lender, title insurance policy to protect the lender from any problems with the title, but would the buyer in this case still have to provide a mortgagee policy to the seller? (Updated July 24, 2015)

Yes, if you're using the TREC contracts. Paragraph 4C of the TREC contracts state that if an owner policy of title insurance is furnished to the buyer in a seller-financing transaction, then the buyer has to provide the seller with a mortgagee policy of title insurance.


Legal Disclaimer: The material provided here is for informational purposes only and is not intended and should not be considered as legal advice for your particular matter. You should contact your attorney to obtain advice with respect to any particular issue or problem. Applicability of the legal principles discussed in this material may differ substantially in individual situations.

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