FAQ’s

A home is the single largest investment most of us will make in our lives. To buy with confidence, get owner’s title insurance. It’s the smart way to protect your property from legal and financial claims. To help you understand how it works, here are answers to common questions:

What is a Title?
A title is your ownership right to your property.
What is Title Insurance?
Owner’s title insurance is meant to protect your ownership interest in your home. Subject to the terms of your policy, owner’s title insurance protects you against losses incurred due to any title defects that existed prior to the purchase of your home. Your owner’s title policy offers insurance protection for as long as you own your home. To the extent of the matters covered in the policy, an owner’s title insurance policy will protect you in the event a legal challenge is made to the ownership of your home.
How does Title Insurance Work?
As property changes hands, mistakes and irregularities – often made long before you expressed interest in the property – can place your ownership in dispute. The seller may have:
• Avoided disclosure of using the property as collateral for an unpaid loan.
• Fraudulently claimed to be the sole owner.
• Failed to pay real estate taxes.
Even a simple mistake in the recording of legal documents, improper execution of legal instruments or the reappearance of undisclosed or missing heirs could result in the loss of your home.
Types of Title Insurance
If you’re buying a home, title insurance is a policy that protects your investment and property rights. There are two different types of title insurance: owner’s policy and lender’s policy.

Type 1: An owner’s policy protects your property rights for as long as you own the home.

Type 2: A lender’s policy is usually required by the lender and protects only the lender’s financial interests. The buyer typically pays for this policy, but this varies depending on geography. We recommend you ask an ALTA member how it’s handled in your area.

What is a title search?
A title search is a standard part of the home buying process that is conducted to uncover issues that could prevent your right to the property. Your closing agent reviews public records to see if there are problems or defects that could cause you legal issues.
Why should I purchase Owner’s Title Insurance?
Purchasing owner’s title insurance is a smart decision because it’s the best way to protect your property from future legal claims.
What does Owner’s Title Insurance Cost?
The one-time payment for owner’s title insurance is low relative to the value of your home. The typical owner’s title insurance policy costs around 0.5% of the home’s purchase price.
For how long am I covered?
Your owner’s insurance policy lasts as long as you own your property. Your life will change over time, but your peace of mind never will.
Important Reasons why you need Owner’s Title Insurance.
Your policy may cover:
1. Forgery of a covered document
2. Fraud in the execution of a deed or other covered document
3. Undue influence exercised over the grantor of a deed
4. False impersonation by someone purporting to be the owner of the property
5. Undisclosed or missing heirs
6. Wills not properly probated
7. Misinterpretation of wills and trusts
8. Mental incompetence of a grantor of a deed
9. Transfer of title by a minor
10. Heirs born after the execution of a will
11. Incorrect legal descriptions
12. Non-delivery of deeds
13. Deeds executed under expired or false powers of attorney
14. Confusion due to similar or identical names
15. Dower or curtesy or homestead rights of spouses of former owners
16. Incorrect indexing of the land records
17. Clerical errors in recording legal documents
18. Delivery of deeds after the death of the Grantor
Protect yourself and your family with the security of Owner’s Title Insurance
In order to provide title coverage, we search public land records for documents and other interests that may be associated with the title to your home. If we identify recorded defects, liens or encumbrances upon the title, such as unpaid taxes, unsatisfied mortgages, easements, or restrictions, these are identified on a report prepared prior to your purchase of the property. We will then discuss with you how to resolve these items prior to closing. If you later identify a potential title issue, you should review our policy for potential coverage.
We guarantee property protection
To the extent of your coverage under your title insurance policy, if ownership of your property is challenged, the title insurance will defend your ownership of the property – and assume the legal costs of that defense – for as long as you own the property. What’s more, if challenges to your property’s title proves to be legitimate, the title insurance will pay for your covered losses.

Take advantage of the title company’s expertise, strength and superior service for your peace of mind and the protection of your property.

What is FIRPTA?
United States tax law requires that all persons pay income tax on the disposition of U.S. real property interests. U.S persons or entities typically are subject to this tax as part of their regular income tax; however, the U.S. needed a way to collect taxes from foreign persons on the sale of U.S. real property interests. The Foreign Investor in Real Property Act (“FIRPTA”) was enacted to provide such a mechanism and requires that a buyer withhold and remit to the IRS, a certain percentage of the sales price (15%) in anticipation of the taxes that will be due from the foreign seller on such transaction. FIRPTA applies in nearly all transactions, residential and commercial, in which a foreign owner of a U.S. real property interest sells such interest. The amount withheld is not the tax itself, but is payment on account of the taxes that ultimately will be due from the seller.

FIRPTA FAQ’s

Who is responsible for FIRPTA withholding?
The IRS rules place the responsibility for withholding potential income tax due in the amount of 10% of the purchase price on the buyer of the real property from a foreign entity. The real property becomes the security for the IRS to ensure that they receive taxes that are due to them. If the payment is not made by the buyer, the IRS can seize the real property (or other assets of the buyer).
Who is responsible for FIRPTA withholding?
The IRS rules place the responsibility for withholding potential income tax due in the amount of 10% of the purchase price on the buyer of the real property from a foreign entity. The real property becomes the security for the IRS to ensure that they receive taxes that are due to them. If the payment is not made by the buyer, the IRS can seize the real property (or other assets of the buyer).
Can’t the buyer assign the responsibility for withholding to the settlement or escrow agent?
There are no provisions in the IRS rules for the buyer to assign their responsibility to anyone else, including the escrow or real estate agents. The escrow agent cannot provide legal or tax advice.
The seller is foreign, but has a social security number. We’re okay, right?
If the seller is foreign, it is likely they do not have a social security number. Foreign citizens doing business and earning income in the United States are required to have taxpayer identification numbers (TINS). These look similar to social security numbers. The test of whether FIRPTA withholding is required or not, is a statement made by the seller under penalty of perjury that they are not a non-resident alien for purposes of U.S. income taxation.
I don’t understand what that means, “not a non-resident alien”. What does that mean?
Another way to explain that (although it may not cover all situations) is that the seller must either be a U.S. citizen or resident alien with a green card.
The seller is taking a loss on their home. They don’t need to pay FIRPTA withholding, right?
Under FIRPTA there is no automatic exemption from withholding if the seller is taking a loss or no gain. If a foreign seller feels they are exempt from FIRPTA withholding because there is no gain on the sale, they need to consult with a tax expert and may find they need to apply for a withholding certificate from the IRS that will grant them the exemption on the transaction using IRS form 8288-B. If this is the case, this should occur early on in the transaction.
A foreign seller doesn’t have a TIN and is willing to pay the IRS. Can the money just be sent to the IRS without a TIN?
No, the IRS requires that sellers of real property have TINs.
A foreign seller only owns a portion of the property. How much money does the foreign seller owe?
The foreign seller will owe withholding on their percentage of ownership of the property.
The property is under $300,000 and the buyer is going to live in it. Doesn’t that automatically exempt it from withholding?
The buyer must agree to sign an affidavit stating that the purchase price is under $300,000 and the buyer intends to occupy. The buyer may choose not to sign the form, in which case withholding must be done.
Isn’t a transaction from a foreign seller to a foreign buyer exempt from withholding?
No. The same rules apply, and both parties are required to have TINs.
The FIRPTA withholding was paid at close of escrow, but not that much money was due to the IRS. How does the seller get their money back?
The seller can either in advance of closing file an 8288-B Application for Withholding Certificate to request a reduced amount or no withholding. The seller can also file a tax return the following year to obtain any refund due.  A CPA or other tax expert should be consulted for guidance.
The sellers and buyer don’t want to pay a CPA to answer their questions. Can’t the real estate person or escrow person help with FIRPTA questions?
Escrow personnel and real estate agents may have experience with FIRPTA, but are not qualified to provide advice on individual taxpayer’s situations.
The seller lives in another country, but says they are a U.S. citizen. Isn’t withholding required?
U.S. citizens may be living in other countries. Current residency is not a good indication of FIRPTA status.

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Testimonials

  • “We just finished closing on the sale of our condo in Miami. Marion was an outstanding partner who helped us execute the closing with seamless precision and ensuring all i’s were dotted in time for the closing. Despite being remote for the closing she did an outstanding job. Customer service at its best! Highly recommend Cloudless Title for your needs.”

    Sonal Bhatia

  • “I only have excellent words for Marion. Her work is impeccable, transparent, efficient. I recommend Cloudless Title and Marion 1,000%. We had a sale and a purchase very much complicated due to the other parties, but she and the team did a such a phenomenal job. Both transactions were successful at the end. Thanks, Marion!!”

    Natalia Diaz

  • “In 14 years as an agent, I had not found a title company like Cludless Title This is My first closing with Cloudless title, I was amazed with the attention, diligence, communication, service and speed with which we closed the transaction. My next transaction will be again with Cloudless Title… I recommend it 1000%”

    Werner Velasquez

  • “Working with Marion is always a great and wonderful experience. She is always willing to help each party on the transaction and go the extra mile, even when it’s not necessarily part of her own duties. I recommend her and her company 100%.”

    Fausto Garofalo

  • “Marion you Rock! Thanks for everything as always impeccable service! I highly recommend Cloudless Title for your future business!”

    Javier Motta

  • “Our realtor, Consuelo Peniza, recommended us to use Cloudless Title because she’s had great closings with Marion. Well…she wasn’t kidding. Marion was excellent, super responsive during the process, well prepared, took her time to explain every single line of our HUD and didn’t leave our home (yes, it was an onsite visit) until we were clear on all docs to be signed. We are very happy with the personal touch and professionalism of Marion & Cloudless Title. Thanks to both for a perfect closing.”

    Xavier Robalino

  • “I have worked with Marion Castro (owner) for many years. With her willingness to help, professionalism, knowledge and many years of experience, she is able to give you a secure, pleasant and smooth closing experience with Cloudless Title Company . Guaranteed.”

    Alejandro Sanchez

  • “I am a broker and I have worked with Marion Castro for 6 years; I highly recommend her, excellent work!”

    Gabriela De Marinis

  • “At first and for years, working with title companies had always been a headache for both me and my client, that changed radically a few years ago, when I had the opportunity to meet Marion Castro, it is a real pleasure to work with her and her team, she is professional, dedicated, knowledgeable, she solves problems and helps you a lot to carry a smooth and secure end transaction. I highly recommend her.”

    Rosa Poler

  • “Marion Castro and her company are number one in customer service. I can’t remember the last time a Title Company answered my phone calls, texts and emails after hours. Marion is highly professional and knowledgable in in delivering Title and providing a smooth closing, following up with all parties in a timely manner. She is priceless!!! I highly recommend her.”

    Consuelo Peniza

  • “Marion is special, She has been a pleasure to work with. She brings her attention to every detail in each transaction and Her communication and people skills are magnificent.”

    Simon Pavonessa

  • “I have been working with Marion Castro for the last 4 years. The experience with Marion referring my clients for their closings has been outstanding. Marion Castro is a knowledgeable and organized person. I am very please with her services.”

    Giancarlo Butron

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