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Escrow Officer practice questions

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Question 1Escrow and settlement: authority, funds, documents and a controlled closing

What is the defining characteristic of an escrow agent's relationship to the parties?

  1. Advocate for the buyer
  2. Advocate for the seller
  3. Dual neutral fiduciary Correct answer.
  4. Government appointee

Explanation

An escrow agent serves as a dual neutral fiduciary, holding funds and documents in trust for both parties under written instructions. The agent cannot favor either side and must follow instructions strictly and impartially.

Question 2Escrow and settlement: authority, funds, documents and a controlled closing

Escrow instructions must generally be:

  1. Verbal and informal
  2. In writing, signed by all parties, with mutual instructions Correct answer.
  3. Signed only by the escrow officer
  4. Issued by a court

Explanation

Escrow instructions must be in writing and signed by all principals. They constitute the contract that governs the escrow officer's actions; the officer cannot disburse or perform without mutual written authorization.

Question 3Escrow and settlement: authority, funds, documents and a controlled closing

'Opening escrow' typically refers to:

  1. Sending wire instructions
  2. The acceptance of a real estate purchase agreement and delivery to the escrow holder, who opens the file and orders title Correct answer.
  3. Recording the deed
  4. Issuing the title policy

Explanation

Escrow opens when the purchase agreement is signed and delivered to the escrow holder, who creates a file, assigns an escrow number, orders the title commitment, and begins coordinating the transaction.

Question 4Escrow and settlement: authority, funds, documents and a controlled closing

In most states, escrow officer trust accounts must be reconciled:

  1. Quarterly
  2. Annually
  3. Monthly using a three-way reconciliation (bank statement, book balance, trial balance of escrow files) Correct answer.
  4. Only when audited

Explanation

State laws and ALTA Best Practices Pillar #2 require monthly three-way reconciliation: bank balance, book balance, and trial balance of all open escrow files. Any out-of-balance condition must be investigated and resolved promptly.

Question 5Escrow and settlement: authority, funds, documents and a controlled closing

What is 'good funds' for purposes of disbursement?

  1. Personal checks of any amount
  2. Funds verified as collected and immediately available, such as wires and (in some states) cashier's checks Correct answer.
  3. Foreign currency
  4. Promissory notes

Explanation

Good funds are funds collected and immediately available for disbursement - typically wires and cashier's checks (some states accept certified checks). State good-funds statutes prohibit disbursing against uncollected items that could be returned unpaid.

Question 6Escrow and settlement: authority, funds, documents and a controlled closing

Prorations at closing are calculated as of:

  1. The contract date
  2. The closing/recording date (varies by custom and contract) Correct answer.
  3. The loan application date
  4. The 1st of the next month

Explanation

Prorations are typically calculated as of the closing date (or recording date, depending on local custom and the purchase agreement). Items prorated include property taxes, HOA dues, prepaid rents, utilities, and similar recurring charges.

Question 7Escrow and settlement: authority, funds, documents and a controlled closing

An escrow officer receives conflicting closing instructions from buyer and seller. The officer should:

  1. Choose the lender's instructions
  2. Pick the most recent
  3. Notify both parties in writing and request mutual reconciliation; if unresolved, interplead the funds Correct answer.
  4. Cancel the escrow

Explanation

When instructions conflict, the neutral escrow officer must notify both parties in writing and seek mutual reconciliation. If parties cannot agree, the officer's remedy is to file an interpleader action and deposit the funds with the court rather than choose a side.

Question 8Escrow and settlement: authority, funds, documents and a controlled closing

What is the purpose of the Closing Disclosure (CD)?

  1. Marketing brochure
  2. An itemized federal disclosure of all loan terms and settlement costs delivered to the consumer at least 3 business days before consummation under TRID Correct answer.
  3. A property listing agreement
  4. A homeowner's insurance policy

Explanation

The Closing Disclosure (CD) is the standardized federal disclosure under TRID showing loan terms, projected payments, closing costs, and cash to close. The creditor must ensure delivery at least 3 business days before consummation.

Question 9Escrow and settlement: authority, funds, documents and a controlled closing

RESPA generally applies to:

  1. Federally related mortgage loans on 1-4 family residential property Correct answer.
  2. Cash transactions
  3. Vehicle loans
  4. Commercial loans over $5M

Explanation

RESPA applies to most federally related mortgage loans on 1-4 family residential property, including home purchases, refinances, and home-equity loans. All-cash purchases without a federally related mortgage are exempt.

Question 10Escrow and settlement: authority, funds, documents and a controlled closing

Wire fraud in real estate closings is most often perpetrated through:

  1. Theft of paper checks
  2. Business email compromise (BEC) and email spoofing to alter wiring instructions Correct answer.
  3. Robbery of bank vaults
  4. Counterfeit signatures on deeds

Explanation

Real estate wire fraud is dominated by business email compromise: criminals hack or spoof emails (often the title/escrow office) to send fraudulent wiring instructions. ALTA Pillar #3 and the FTC Safeguards Rule require controls including verbal verification through a known phone number, MFA, and encrypted email.

Question 11Escrow and settlement: authority, funds, documents and a controlled closing

Form 1099-S reports:

  1. Mortgage interest
  2. Gross proceeds of real estate sales to the IRS Correct answer.
  3. Closing costs
  4. Title insurance premiums

Explanation

Form 1099-S reports gross proceeds from real estate transactions to the IRS. The settlement agent is typically the reporting person and must file the return and provide a copy to the seller, unless the transaction is exempt (e.g., principal residence with proper certification under safe harbor).

Question 12Escrow and settlement: authority, funds, documents and a controlled closing

Under FIRPTA, the standard withholding rate on the amount realized by a foreign seller is:

  1. 5%
  2. 10%
  3. 15% Correct answer.
  4. 30%

Explanation

FIRPTA (Foreign Investment in Real Property Tax Act) generally requires a 15% withholding on the amount realized when the seller is a foreign person. A reduced 10% rate applies to certain residential transactions $300,001-$1,000,000; some lower-priced personal-residence sales may be exempt.

Question 13Escrow and settlement: authority, funds, documents and a controlled closing

Recording the new deed and mortgage at the county recorder generally:

  1. Has no legal effect
  2. Provides constructive notice to the world of the recorded interests Correct answer.
  3. Voids the deed
  4. Replaces the title policy

Explanation

Recording provides constructive notice to subsequent purchasers and creditors that the recorded interests exist. It is essential to establish priority and perfect liens. Recording does not validate an invalid instrument, but proper recording creates public notice.

Question 14Escrow and settlement: authority, funds, documents and a controlled closing

Anti-Money Laundering (AML) requirements for non-financed residential purchases in covered metropolitan areas are imposed by:

  1. The SEC
  2. FinCEN through Geographic Targeting Orders (GTOs) Correct answer.
  3. HUD
  4. The Federal Reserve

Explanation

FinCEN's Geographic Targeting Orders (GTOs) - and the 2024 Residential Real Estate Reporting Rule effective in 2026 - require title insurance companies in specified metropolitan areas to report beneficial-ownership information on certain non-financed residential purchases by legal entities above specified thresholds.

Question 15Escrow and settlement: authority, funds, documents and a controlled closing

In most jurisdictions, escrow funds belong to:

  1. The escrow company
  2. The principals (buyer/seller/lender) until properly disbursed under instructions Correct answer.
  3. The state
  4. The lender

Explanation

Escrow funds remain the property of the principals (buyer, seller, lender as applicable) until the escrow officer disburses them per the written instructions. The officer holds them as a trustee/fiduciary, not as company assets.

Question 16Escrow and settlement: authority, funds, documents and a controlled closing

What document typically conveys real property from seller to buyer at closing?

  1. A bill of sale
  2. A deed Correct answer.
  3. A promissory note
  4. A title commitment

Explanation

A deed (typically a general or special warranty deed, or grant deed in some states) is the instrument that conveys real property from grantor to grantee. The deed must be properly executed, acknowledged, and recorded to complete the transfer.

Question 17Escrow and settlement: authority, funds, documents and a controlled closing

Earnest money deposited into escrow is typically:

  1. Released to the seller immediately
  2. Held in the trust account and credited to the buyer's purchase price at closing (or distributed per the purchase contract) Correct answer.
  3. Forfeit if closing is delayed by one day
  4. Kept by the escrow officer

Explanation

Earnest money is held in the escrow trust account and applied to the buyer's purchase price at closing, or distributed according to the purchase contract terms in case of cancellation or breach.

Question 18Escrow and settlement: authority, funds, documents and a controlled closing

A 'closing protection letter' (CPL) is issued to:

  1. The seller, by the agent
  2. A lender (and sometimes parties) by the title underwriter, indemnifying against the closing agent's fraud or failure to follow written closing instructions Correct answer.
  3. The buyer's attorney
  4. The IRS

Explanation

A CPL is issued by the title underwriter to the lender (and in many states the buyer/seller) and indemnifies the addressee against actual loss caused by the closing agent's fraud, dishonesty, theft of escrow funds, or failure to follow the lender's written closing instructions.

Question 19Escrow and settlement: authority, funds, documents and a controlled closing

To prevent wire fraud, an escrow officer should:

  1. Email wiring instructions immediately
  2. Verify any change in wiring instructions verbally with the recipient using a previously known phone number Correct answer.
  3. Use any phone number that arrives by email
  4. Skip verification for repeat clients

Explanation

Best practice (ALTA Pillar #3 and FTC Safeguards Rule) is to verify wiring instructions - particularly any change - verbally with the recipient using a phone number obtained from a trusted source independent of the email request. Never trust numbers supplied within suspect emails.

Question 20Escrow and settlement: authority, funds, documents and a controlled closing

Property tax prorations on a property where taxes are paid in arrears (e.g., Texas):

  1. Are credited to the buyer for the seller's pre-closing period Correct answer.
  2. Are credited to the seller
  3. Do not occur
  4. Are paid only at year-end

Explanation

When taxes are paid in arrears, the buyer will eventually pay the full year's tax bill though the seller occupied the property for part of the year. The seller credits the buyer at closing for the seller's portion of the unpaid taxes.

Question 21Escrow and settlement: authority, funds, documents and a controlled closing

A 'short sale' typically requires:

  1. No lender involvement
  2. Approval from each lender holding a lien because the sale proceeds are less than the loan balance Correct answer.
  3. Foreclosure first
  4. A new appraisal yearly

Explanation

In a short sale, sale proceeds are less than the total loans secured by the property. Each lienholder must approve accepting less than the full payoff. Escrow must obtain lender approval letters and ensure all liens are properly released.

Question 22Escrow and settlement: authority, funds, documents and a controlled closing

In a closing, the seller's net proceeds are typically:

  1. The contract price minus all seller-side debits Correct answer.
  2. Always equal to the purchase price
  3. The lender's payoff
  4. The earnest money

Explanation

Seller net proceeds equal the sales price minus all seller-side debits (loan payoffs, real estate commissions, prorated taxes, recording fees, transfer taxes, title premium where customary, escrow fee splits, etc.).

Question 23Escrow and settlement: authority, funds, documents and a controlled closing

Required signatures and acknowledgment for a deed in most states include:

  1. Just the grantor's printed name
  2. Grantor's signature, witnessed and/or notarized acknowledgment per state law Correct answer.
  3. Both grantor and grantee signing
  4. The lender's signature only

Explanation

A deed must be signed by the grantor and acknowledged before a notary (and witnessed in some states). The grantee does not sign the deed. Proper acknowledgment is essential for recording.

Question 24Escrow and settlement: authority, funds, documents and a controlled closing

The lender's payoff figure for a closing should be:

  1. Estimated by the escrow officer
  2. Obtained directly in writing from the existing lender, valid through a specified date Correct answer.
  3. Calculated from the original note
  4. Taken from the borrower's last statement

Explanation

The escrow officer must obtain a written payoff statement directly from the existing lender showing principal, interest accrued through a 'good through' date, plus per diem interest. Reliance on borrower estimates risks underpayment and short payoff.

Question 25Escrow and settlement: authority, funds, documents and a controlled closing

Under TRID, the 3-business-day waiting period after Closing Disclosure delivery means closing cannot occur until:

  1. 1 day after
  2. 3 business days after the consumer receives the CD Correct answer.
  3. On the day of delivery
  4. 7 days after

Explanation

TRID 12 CFR 1026.19(f) requires the CD to be received by the consumer at least 3 business days before consummation. 'Business day' for this purpose excludes Sundays and federal holidays. Closing may occur on the fourth business day.

Question 26Escrow and settlement: authority, funds, documents and a controlled closing

An escrow officer who fails to record a deed within instructions and exposes a lender to gap-period risk may be:

  1. Held harmless automatically
  2. Liable for breach of fiduciary duty and negligence Correct answer.
  3. Promoted
  4. Disciplined only if intentional

Explanation

Failure to follow written closing instructions exposes the officer (and their employer) to claims of breach of fiduciary duty, negligence, and possibly a Closing Protection Letter claim by the lender. Damages may include actual losses incurred.

Question 27Escrow and settlement: authority, funds, documents and a controlled closing

A 'commission disbursement authorization' (CDA) is typically:

  1. A general accounting principle
  2. An authorization from the real estate broker to disburse commissions from escrow at closing Correct answer.
  3. A bank loan agreement
  4. An IRS form

Explanation

A CDA (sometimes 'disbursement authorization') is signed by the broker authorizing the escrow agent to disburse the commission split as directed at closing. It ensures commissions are paid correctly and that the broker has approved any adjustments.

Question 28Escrow and settlement: authority, funds, documents and a controlled closing

An escrow officer should never:

  1. Communicate with both parties
  2. Disburse funds before written instructions are met and good funds are collected Correct answer.
  3. Charge a fee
  4. Order title work

Explanation

Disbursing before all instructions are met and good funds collected violates fiduciary duty, exposes the officer's employer to liability under the CPL, and may violate state good-funds law. This is one of the most common sources of escrow losses.

Question 29Escrow and settlement: authority, funds, documents and a controlled closing

What is 'commingling' in trust accounts?

  1. Mixing client funds with the firm's operating funds Correct answer.
  2. Discussing two cases together
  3. Writing notes on the file
  4. Closing two transactions same day

Explanation

Commingling - mixing fiduciary trust funds with the firm's operating funds - is a serious violation of state escrow regulations and can result in license revocation, fines, and personal liability. Trust funds must be strictly segregated.

Question 30Escrow and settlement: authority, funds, documents and a controlled closing

In community property states, property acquired during marriage with community funds is generally:

  1. The husband's separate property
  2. Owned 50/50 by both spouses, with both required to sign for conveyance Correct answer.
  3. The wife's separate property
  4. Owned only by whoever's name appears on the deed

Explanation

In community property states (TX, CA, AZ, NV, NM, ID, LA, WI, WA), property acquired during marriage with community funds is presumed to be community property owned equally. Both spouses must sign deeds, mortgages, and many key documents to convey or encumber the property.

Question 31Escrow and settlement: authority, funds, documents and a controlled closing

A 'reverse mortgage' (HECM) payoff at closing typically requires:

  1. Approval from HUD/FHA Correct answer.
  2. No special handling
  3. Approval from a court
  4. No payoff is needed

Explanation

HECM reverse mortgages are insured by HUD. Payoff in connection with a sale or death of the borrower follows specific HUD procedures, often involving FHA-approved servicers; the escrow officer should obtain written payoff and confirm release procedures.

Question 32Escrow and settlement: authority, funds, documents and a controlled closing

The 'Privacy Notice' under GLBA must be provided to consumers:

  1. Only after a complaint
  2. Initially and annually thereafter to disclose information-sharing practices and consumer rights Correct answer.
  3. Only when closing fails
  4. Never

Explanation

Under the Gramm-Leach-Bliley Act, financial institutions (including most title/escrow companies) must provide consumers an initial privacy notice and annual notices describing what NPI is collected, how it is shared, and the consumer's opt-out rights, where applicable.

Question 33Escrow and settlement: authority, funds, documents and a controlled closing

An escrow officer learns the buyer is purchasing through an LLC formed yesterday with no clear beneficial owner. The officer should:

  1. Proceed with no inquiry
  2. Conduct customer due diligence and, if subject to FinCEN's reporting rule, gather beneficial ownership information Correct answer.
  3. Refuse to close
  4. Report to the FBI

Explanation

Under FinCEN's Residential Real Estate Reporting Rule (and applicable GTOs), title insurance companies must perform due diligence and report beneficial ownership for non-financed residential purchases by legal entities meeting thresholds. The officer should follow company AML procedures.

Question 34Escrow and settlement: authority, funds, documents and a controlled closing

A 'simultaneous issue' rate generally applies to:

  1. Two policies issued at the same closing - typically owner's plus loan policy Correct answer.
  2. Two unrelated closings on the same day
  3. One policy issued twice
  4. One policy on two separate lots

Explanation

Simultaneous issue refers to issuing the owner's policy and the lender's policy at the same closing on the same property. The loan policy is generally issued at a heavily discounted simultaneous rate (often a nominal amount such as $50-$200).

Question 35Escrow and settlement: authority, funds, documents and a controlled closing

When are escrow funds typically interest-bearing for the benefit of the parties?

  1. Only if all parties agree in writing and state law permits (often with disclosure) Correct answer.
  2. Always
  3. Never
  4. Only for FHA loans

Explanation

Escrow funds may be placed in an interest-bearing account when all parties agree in writing and state law permits, with appropriate disclosure. Many smaller escrow holds are placed in non-interest-bearing trust accounts; IOLTA-like arrangements may apply in some jurisdictions.

Question 36Escrow and settlement: authority, funds, documents and a controlled closing

The settlement statement line item 'Owner's title insurance premium' typically:

  1. Cannot vary by state
  2. Is paid by the buyer or seller depending on local custom or contract Correct answer.
  3. Is always paid by the lender
  4. Is paid only by the escrow officer

Explanation

Who pays the owner's title premium varies by local custom and the purchase contract. In some states the seller pays (e.g., parts of CA, TX, FL), in others the buyer pays. The contract controls; escrow follows it.

Question 37Escrow and settlement: authority, funds, documents and a controlled closing

A 'mortgage release' or 'satisfaction of mortgage' should be obtained from the existing lender after:

  1. The escrow opens
  2. The payoff is sent and applied to the loan balance, requesting written release for recording Correct answer.
  3. Title is searched
  4. The buyer signs

Explanation

After paying off the existing mortgage, the escrow officer or settlement agent must obtain and record a satisfaction or release of mortgage from the lender to remove the lien of record. Failure to record release within statutory time can subject the lender to penalties.

Question 38Escrow and settlement: authority, funds, documents and a controlled closing

Which is NOT a valid 'good funds' source under most states' good-funds statutes?

  1. A wire transfer
  2. A personal check for $500,000 Correct answer.
  3. A cashier's check from an in-state bank
  4. An ACH credit (if state permits)

Explanation

Most state good-funds statutes specifically exclude personal checks, particularly for large sums. Wires, cashier's checks (state-permitted issuers), and certified checks are accepted; ACH credits may be permitted in some states.

Question 39Escrow and settlement: authority, funds, documents and a controlled closing

Earnest money disputes (after a contract cancellation) require:

  1. The escrow officer to decide who gets the money
  2. Mutual written release from both parties, or court interpleader Correct answer.
  3. Immediate return to buyer
  4. Immediate release to seller

Explanation

The escrow officer cannot unilaterally decide between disputing parties. The required path is: (1) attempt to obtain mutual written release/disbursement instructions, or (2) interplead the funds into court if mutual agreement cannot be reached.

Question 40Escrow and settlement: authority, funds, documents and a controlled closing

When does title pass from grantor to grantee?

  1. When the contract is signed
  2. When the deed is delivered and accepted Correct answer.
  3. When the deed is signed (but kept by grantor)
  4. When the seller cashes the buyer's check

Explanation

Title passes when the deed is delivered (manually or constructively, including through escrow) and accepted by the grantee with intent. In escrow closings, delivery occurs when conditions of the escrow are met and the deed is released for recording.

Question 41Escrow and settlement: authority, funds, documents and a controlled closing

For tax purposes, a 1031 exchange's identification period requires the taxpayer to identify replacement property within:

  1. 15 days
  2. 45 days from the sale of the relinquished property Correct answer.
  3. 90 days
  4. 180 days

Explanation

Under IRC Section 1031, the taxpayer must identify potential replacement properties within 45 days of the sale of the relinquished property, and must close on the replacement within 180 days. Identification is in writing to the Qualified Intermediary.

Question 42Escrow and settlement: authority, funds, documents and a controlled closing

An escrow officer is approached by a 'remote' notary signing agent. The officer should verify:

  1. Whether remote online notarization (RON) is permitted in the state of property/document signing Correct answer.
  2. Nothing - RON is universal
  3. Only the signing fee
  4. Nothing - RON is illegal everywhere

Explanation

Remote Online Notarization is now permitted in most U.S. states with statutory requirements (audio-video, identity verification, audit trails). The officer must confirm that the state where the property is located and the law governing the document accept RON for the document type.

Question 43Escrow and settlement: authority, funds, documents and a controlled closing

Recording fees, transfer taxes, and similar charges are typically:

  1. Negotiable but governed by local custom and the purchase contract Correct answer.
  2. Set by the federal government
  3. Always paid by the lender
  4. Always paid by the escrow officer

Explanation

Recording fees and transfer taxes (stamp/documentary taxes) are set by local statute. Allocation between buyer and seller follows local custom unless the purchase contract specifies otherwise. The officer disburses per the contract.

Question 44Escrow and settlement: authority, funds, documents and a controlled closing

A buyer's closing funds wire arrives one hour before closing. Escrow should:

  1. Disburse immediately
  2. Confirm the wire is actually received and irrevocably credited before disbursing Correct answer.
  3. Refuse the wire
  4. Send a reverse wire

Explanation

Wires must be confirmed as actually received and credited to the trust account before the funds are 'good funds' available for disbursement. Sending wires can be reversed/rejected before posting; only credited funds are disbursable.

Question 45Escrow and settlement: authority, funds, documents and a controlled closing

The HOA (homeowners association) 'estoppel certificate' or 'statement of account':

  1. Is irrelevant at closing
  2. Provides the current dues, assessments, special charges, and violations that must be paid or assumed at closing Correct answer.
  3. Is a tax form
  4. Replaces the deed

Explanation

In HOA-encumbered transactions, the escrow officer orders an HOA estoppel/statement showing current dues, assessments, late charges, special assessments, transfer fees, and notes any violations. Amounts due are paid at closing and the new owner is responsible going forward.

Question 46Escrow and settlement: authority, funds, documents and a controlled closing

A 'judgment lien' search at closing typically involves:

  1. Checking the social media of the parties
  2. Searching name indexes for judgments against parties affecting the property Correct answer.
  3. Calling the police
  4. Checking USPS records

Explanation

Escrow/title search includes name-index searches in the county where the property lies (and sometimes statewide) for judgments against the seller (and sometimes buyer) that could attach to the property. Judgments must be paid or addressed to clear title.

Question 47Escrow and settlement: authority, funds, documents and a controlled closing

Closing instructions from the lender typically require the escrow agent to:

  1. Disburse only when title is in the prescribed condition, the borrower has signed all loan documents, and the funds will be applied as specified Correct answer.
  2. Ignore the lender
  3. Provide loan amortization
  4. Issue the title policy

Explanation

Lender closing instructions specify the conditions for disbursing the lender's wired funds: required documents signed and notarized, title in specified condition (lender's policy issued at closing with stated coverage and endorsements), and disbursement order. Compliance is essential to CPL protection.

Question 48Escrow and settlement: authority, funds, documents and a controlled closing

The escrow officer must verify identity of signers to:

  1. Reduce premium
  2. Prevent fraud and forgery, meet notary requirements, and comply with CIP/AML rules Correct answer.
  3. Confirm signing dates
  4. Avoid recording errors

Explanation

Identity verification is essential to prevent impostor fraud (a covered title risk), to satisfy notary acknowledgment requirements, and increasingly to comply with customer identification program (CIP) and AML obligations under FinCEN rules.

Question 49Escrow and settlement: authority, funds, documents and a controlled closing

Why is GLBA-required nonpublic personal information (NPI) sensitive in escrow?

  1. NPI includes financial account numbers, SSNs, and similar data subject to safeguards Correct answer.
  2. NPI is public
  3. NPI is unrelated to escrow
  4. Only insurance companies have NPI

Explanation

NPI includes Social Security numbers, bank account and routing numbers, loan numbers, and other private financial data routinely collected in escrow files. GLBA and the FTC Safeguards Rule require encryption, access controls, employee training, and incident response plans.

Question 50Escrow and settlement: authority, funds, documents and a controlled closing

A 'lis pendens' on the property must be:

  1. Ignored if filed by the buyer
  2. Addressed before issuing clear title - typically requiring release or final disposition of the underlying lawsuit Correct answer.
  3. Removed automatically
  4. Filed by escrow

Explanation

A lis pendens (notice of pending action) provides constructive notice of litigation affecting title. Title cannot be insured without exception until the lis pendens is released by the filing party, dismissed by the court, or the underlying litigation is resolved.