Title Term: CC&Rs – What does it mean?

As part of the disclosure process, once a prospective buyer has an accepted offer on California real estate they will need to review the CC&Rs (if there are any) that exist for the home being purchased.

CC&Rs stands for Covenants, Conditions and Restrictions
Sounds complicated, but it’s not really…although they can be VERY lengthy with LOTS of legal terms. You will find them most commonly in subdivisions/housing tracts and they are generally recorded documents.

Simply put, CC&Rs are a description of things a homeowner can and cannot do with their property on the area in which the property resides.

Covenants are promises to do or not do certain things.
The homeowner might be prohibited from parking an RV on the street or in the driveway (a separate area would normally be provided).

Conditions are pretty much the same as covenants, except that it refers to either the monetary penalty, court injunction or action taken against the homeowner for violating a covenant. A condition can also specify an action that a homeowner must take in order to correct a covenant violation.

Restrictions limit the activities of homeowners
(e.g., You can’t turn your property into a farm) to assure that the property use is consistent with the land use in the general area.

If there is a Home Owner’s Association (HOA) they have the authority to enforce these rules. Please Note: CC&Rs DO NOT report on the status or solvency of their governing HOA.

CC&Rs ARE NOT NEGOTIABLE and their review is part of the real estate contractual process. A preliminary title report will indicate that CC&Rs exist but will not specify them. Digital copies of these LENGTHY public records are obtainable at the start of the escrow process.

The power (or lack thereof) behind a Power of Attorney.

There have recently been many questions, issues and potential title/legal ‘fires’ regarding Powers of Attorney and how they work in the sale of real property.

Here are some of the more IMPORTANT FACTS regarding Powers of Attorney:

1. There are different types of Powers of Attorney for different and specific purposes.

2. In most cases, title companies will require a Specific Power of Attorney granting a Specified Attorney in Fact the authority to act as a representative to sell a specified parcel of property.

3. A Power of Attorney cannot be used to act on behalf of a trustee of a trust.

4. All Power of Attorney documentation should be reviewed (verified) before entering into any sort of real estate contract/agreement. Similarly, most title companies will require a copy of this documentation to determine its valid application to the transaction at hand.

5. Most title companies WILL NOT accept a Power of Attorney that is older than two years.

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Avoiding the 11th Hour Problems

Our goal is to get a real estate transaction closed on time and insure clear title. There are several items that can delay the closing of a transaction.  Some show up when the Preliminary Title Report is prepared while others may be discovered during a conversation with the owner or other agent.

It is critical that you bring these to the attention of your escrow and title professionals
immediately. These items may require added clearance and processing time for escrow and title.

• Establishing the Fact of Death of an Owner of Record
• The Use and Proper Execution of a Power of Attorney
• Liens and/or Judgments—Federal or State Taxes, Spousal Support, Child Support, etc
• Probate
• Bankruptcy
• Transfer or Loans Involving Corporations or Partnerships
• Buyer or Seller Traveling or Living Outside of the United States
• Changes in Buyers
• Change in Policy Coverage
• Recently Built or Remodeled Properties
• Family or Business Trust
• Property Recently Foreclosed Upon
• Physical Inspection Findings—Encroachments, Off-Record Easements
• Proper Execution of Documents—Grantees Compare to Trustors, Proper Jurats and Notary Seals.
• Short Sale with Multiple Loans

Happy 4th of July!

Screen shot 2013-07-03 at 5.59.15 PMOn behalf of all your title partners at Western Resources Title, we wish you and your loved ones a safe and enjoyable 4th of July Holiday.

At WRT we believe that service should be hands-on and local.  We have come to be known as the most expedient resource in the title industry, but did you know that ALL of our work is done locally?  From the searching and abstracting of a preliminary title report to the issuance of a title policy, all of this work is done in your back yard and not some distant land or time zone.

Thank you for supporting WRT, an 100% American Made company and product!