Answers To Most Of Your Title Questions

What is title insurance?

Title insurance protects you against ownership claims against your property. Unlike other types of insurance, your title insurance policy, for a onetime premium paid at closing, provides protection to you and your heirs for as long as you own your property.

Title insurance also protects you from events that happened in the past, including forgery, forgotten heir, or other claims by people or entities who may (unknown to you) have a right to the property.

Is title insurance optional?

Title searches don’t uncover every possible defect in a title, they only discover events and documents of public record. As such, anything done illegally or without proper documentation may not be known until sometime in the future.

The most thorough title search is also prone to human error and, even if the title company has done their job perfectly, there may have been an error in recording or at some other step in any previous transaction.

Lenders do not consider title insurance optional. Nearly all institutional lenders insist on having their own policy separate from the owner’s policy. If it’s important for their partial investment in the property, it is even more important for the homeowner to be protected for the full value of the home.

Only an owner’s policy fully protects the buyer against title problems that arise after the home is purchased.

How does title insurance work?

We do a careful search and examination of all recorded documents to determine who currently owns the property, whether it has been properly deeded, and what other parties may have an interest or claim in the property.

This information is disclosed in the title commitment under “exceptions,” so you can review all information prior to taking ownership and make a better informed decision to purchase the property.

The title commitment also lists requirements that must be met to clear any defects in title prior to or at the closing.

Once the closing takes place, the title company records the documents and issues the final title policy (you should keep in a safe place with other legal documents).

If a title problem arise at any future date, the title company will stand behind the policy holder, both monetarily and with legal defense if necessary, to pay claims and defend their title to the property.

Why do I need title insurance?

Title companies state that in more than one-third of all real estate transactions they must undertake extraordinary work to address title issues.

There are potentially hundreds of ways title a to your property can be compromised. Even if you don’t lose your property altogether, certain title defects can make it impossible for you to sell or even give away your property. These include:

• Forged deeds, releases, or wills.

• Documents executed under invalid or expired powers of attorney.

• Misinterpretations of wills.

• Mistakes in recording.

• Undisclosed heirs who surface years or decades later.

Title insurance is a one-time payment and it covers homeowners — and their heirs — for as long as they own the home.

Title companies do most of their remediation work behind the scenes. You may not even be aware that some title defects existed and were taken care of before the closing. Other times you may be asked to sign a document to remove or release the lien or title defect.

A title insurance policy will be your best protection against title problems that may become known after you close on your transaction. The cost for the policy is a one-time fee, and the policy will remain in effect for as long as you own the property.