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A closing protection letter is essentially an agreement from a title insurance company to a lender that indemnifies the lender against any issues arising from a closing agent's errors, fraud or negligence.
A closing protection letter is essentially an agreement from a title insurance company to a lender that indemnifies the lender against any issues arising from a closing agent's errors, fraud or negligence.
A law requiring a title insurer to issue Closing Protection Letters to buyer, seller and lender in a sale, or to both lender and borrower in a refinancing loan, gives protection to people who cannot get that protection today because they are not insureds. Those parties are the seller and the refinancing borrower.
A closing protection letter is a contract between a title insurance underwriter and a lender. In this agreement, the underwriter agrees to indemnify the lender for actual losses caused by certain kinds of misconduct by the closing agent.
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.
A Closing Protection Letter or CPL is offered before closing to protect lenders against unauthorized actions by settlement agents or failure to comply with the terms of the lender's closing instructions.
A law requiring a title insurer to issue Closing Protection Letters to buyer, seller and lender in a sale, or to both lender and borrower in a refinancing loan, gives protection to people who cannot get that protection today because they are not insureds. Those parties are the seller and the refinancing borrower.
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