Shopping For Your Home Loan: Hud'S Settlement Cost Booklet - U.s. Department Of Housing And Urban Development (Hud) Page 42
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48Title Service Fees: title service fees include charges for title search and title
insurance if required. This fee also includes the services of a title or settlement
agent.
Title Insurance: insurance that protects your lender against any title dispute that
may arise over your property. Through a title search, the lender verifies who the
actual property-owners are and whether the property is free of liens. The title
search company then issues title insurance which protects the title of the property
against any unpaid mortgages and judgments. In case a claim is made against the
property, the title insurance provides legal protection and pays for court fees and
related costs. You may also purchase Owner's title insurance which protects you as
the homeowner.
Tax certificate: official proof of payment of taxes due provided at the time of
transfer of property title by the state or local government.
Tax Service Fee: this fee covers the cost of your lender engaging a third party to
monitor and handle the payment of your property tax bills. This is done to ensure
that your tax payments are made on time and to prevent tax liens from occurring.
Tolerance Category: the maximum amount by which the charges for a category
or categories of settlement cost may exceed the amount of the estimate for such
category or categories on a good faith estimate. When the originator selects and
identifies the provider of services, these charges may only increase 10% in the
aggregate. If the borrower selects a provider that is not on the written list provided
by the loan originator, the lender is not subject to any tolerance restrictions for that
service.
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