Asked by: Nikol Magnus
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What is a CPL in real estate?

Last Updated: 9th April, 2020

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A closing protection letter (sometimes “insured closing letter” or “CPL”) forms a contract between a title insurance underwriter and a lender, in which the underwriter agrees to indemnify the lender for actual losses caused by certain kinds of misconduct by the closing agent.

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Regarding this, wHAT DOES Cpl mean in real estate?

A closing protection letter (sometimes “insured closing letter” or “CPL”) forms a contract between a title insurance underwriter and a lender, in which the underwriter agrees to indemnify the lender for actual losses caused by certain kinds of misconduct by the closing agent.

is a closing protection letter necessary? 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 refinance 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.

Thereof, what is Title Cpl fee?

The fees are identical for each underwriter. 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.

How long are closing protection letter good for?

1 year

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Should I pay for closing protection coverage?

Most lenders will require the buyer to pay to cover the lender. It is up to the buyer to decide, before closing, if they also want coverage. There is a one-time small fee (generally $35-60) for this coverage and is purchased within the transaction closing. Anyone can purchase it whether in a flood zone or not.

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What is a closing protection letter for?

A Closing Protection Letter is added protection for the Insured Party (usually the lender/buyer) against actual loss of funds incurred within a specific transaction due to misconduct by the closing agent.

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Is a closing protection letter a finance charge?

Answer: Since the CPL indemnifies the lender for failures of the title company's agent in executing the lender's instructions for the closing of the loan, it would be a finance charge, as I do not believe it falls in any category found in 226.4(c).

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What is an insured closing?

The insured closing is a transfer of risk that allows the parties to look to the resources of a national title insurance underwriter to solve any post-closing problems. In order for a closing to be an insured closing, the closing agent (Hendrich Title Company) must also be issuing the title policy.

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Who provides closing protection letter?

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.

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What is the settlement fee in closing costs?

Definition: Costs assessed at settlement that include a loan origination fee, points, appraisal fee, title search and insurance, survey, taxes, deed recording fee, credit report charge and other costs. The closing costs are usually around 2 percent to 6 percent of the mortgage amount.

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What is CPL in mortgage terms?

The definition of mortgage term: Closing Protection Letter
A Closing Protection Letter is a contract between the lender and the title company that protects the lender should the closing agent make and error or participate in fraudulent and/or negligent activities.

Anya Osenstatter

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What does ICL stand for in real estate?

An insured closing letter, also called a closing protection letter, is issued on behalf of a title agent (i.e., title/settlement company) by the title insurance underwriter for the benefit of your mortgage lender…

Dionisie Susarte

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What is title policy insurance?

Title insurance is a form of indemnity insurance that protects the holder from financial loss sustained from defects in a title to a property. The most common type of title insurance is the lender's title insurance, in which the borrower purchases coverage only to protect the lender.

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What is a closing protection letter Illinois?

New Closing Protection Letters and Procedures for Illinois in 2011. A Closing Protection Letter (CPL) is a form of insurance issued by title insurance companies, insuring the actions of a particular attorney, agent, and/or closer in conducting a closing. This insurance has been offered primarily to lenders in the past.

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What is offer of closing protection coverage?

It is basically (via issuance of a Closing Protection Letter) insurance that will bind the title underwriter to cover you in the event of a loss due to "theft misappropriation, fraud, or other failure to properly disburse settlement, closing or escrow funds" by the licensed agent.

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Is a closing protection letter required in Pennsylvania?

The settlement company will require a Closing Protection Letter (CPL) from your lender. This document and fee ensure that the settlement company will handle the transaction with care and integrity or else reimburse the lender. The Pennsylvania Department of Insurance sets the $125 CPL fee.

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What closing costs cover?

The term "closing costs" includes a variety of expenses above the purchase price of your property, such as fees for an attorney, a title search, title insurance, taxes, lender costs and some upfront housing expenses such as homeowners insurance.