Here’s where we walk you through everything you ever needed to know about title insurance. Provided your questions are about title insurance, that is.
What is Title Insurance?
Put as simply as possible, title insurance ensures that when you purchase a property, you don’t end up owing any unexpected fees or issues you wouldn’t have known about otherwise.
Why Do I Need Title Insurance?
Our best guess would be that it’s because you’re in the process of buying a property. It’s actually against the law to not have title insurance. Do you want this on your record? Let’s avoid involving the authorities whenever possible.
How Does the Title Search Work?
After your sales contract is accepted, a title professional (that’s us) will search the public records to make sure there aren’t any problems with the home’s title. That could be anything from previous construction where the contractors weren’t fully paid, to the house being located on top of an old haunted cemetery, or worse. More than 30% of these searches uncover problems that need to be fixed before you can move in. It’s not worth risking it.
What If There Are Problems That Aren’t Listed In Public Records?
That’s what Title Insurance is for. It covers you in case the public records search doesn’t find a covered issue that could have slipped through the cracks. Nobody’s perfect! Should anything come up, the title professionals (us again) will help you defend the title.
What's an Owner's Policy?
Owner’s title insurance, also called an Owner’s Policy, is what protects you and YOUR investment in your home. As you begin to payoff your mortgage your Owner’s Policy gradually increases protecting your ownership and your growing equity!
What's a Lender's Policy?
Lender’s title insurance, also called a Loan Policy, is the other type of title insurance. All lenders require one when they issue you a loan, as it protects them (and THEIR investment) should a problem with the title arise.The policy amount decreases each year and eventually disappears as the loan is paid off. Nothing gold can stay.
What are Some Common Title Problems?
Here are a couple good ones (bad ones) that we see frequently:
FRAUD & FORGERY
Say you buy a property from someone, then someone else shows up and it turns out that new someone else actually owns it and didn’t, you know, technically, sell it to you. Whoops.
Fraud and forgery are examples of hidden title hazards that can remain undetected until after a closing despite even the most careful precautions. An Owner’s Policy keeps you protected in this case.
So let’s say you buy a house and someone shows up saying their dearly departed mother left that house to her kids, one of whom sold you the house, and the other of whom now wants his share. And the court says you owe it to him. Again, Owner’s Policy has you covered.
Other situations arise where folks who have been out of the picture for a while suddenly show up to claim money from you after you’ve purchased property that at one point was owned in their family. (Say that three times fast.) If you’ve got an Owner’s Policy, we’ve got your back.
Nobody wants to go through these types of things when you’re buying a property. But you can rest assured that if anything comes up, we can help you get through it.
I'm Refinancing! Why Do I Need Title Insurance?
It’s because when you refinance you are obtaining a brand new shiny loan.Your lender will usually require a new title search and Lender’s Policy to protect their investment in the property. You won’t need a new Owner’s Policy though; the one you bought at closing is good for as long as you and your heirs have an interest in the property.
I'm Buying A Newly Built Home! Do I Need Title Insurance?
Even though it’s a new home, chances are the land it sits on had many previous owners. And that means it could have liens, failed payments, and other unpleasant surprises. A title search and Owner’s Policy makes sure you’re in the clear.
How Do I File A Claim?
If there’s a problem, simply reach out to the company you bought the policy from. If you don’t know where your policy is, don’t panic; just contact the company, the agency, or attorney who handled your title purchase. When you make contact, provide them with the address, a brief summary of the issue, and copies of any forms you may have. We’ll take it from there.