What is title insurance?
Why is title insurance so important?
Who is covered by title insurance?
What risks are covered?
What is the title search?
What is the commitment to insure?
How much does title insurance cost?
What is title insurance?
Insurance is a contract between the insured and the title company. Under the terms of the contract the insured agrees to pay a one-time premium and the title company agrees to defend the title or pay losses the insured may suffer if the title is challenged or defective.
Title insurance protects you against hidden mistakes.
Why is title insurance so important?
1. It provides a “safety fence” around your property. It is your assurance of safety.
2. Having title insurance can save you money, time, trouble—and even your home!
Who is covered by title insurance?
The lender and the buyer. When you buy property, you are commonly required to buy title insurance. This covers the outstanding balance on the mortgage for the lender, but does not protect you. When acquiring property, it is a good idea to get your own title insurance policy. It will give you peace of mind and maximum protection in case there’s a claim against your home.
What risks are covered?
ERRORS - incorrect information in deeds, mortgages, public records, etc.
LIENS - claims against the property or the seller that become the new owner’s responsibility after the sale
CLAIMS TO OWNERSHIP - for instance, a claim to “marital interest” by the spouse of a former owner or by a child of a former owner who was not mentioned in his or her parents' wills; INVALID DEEDS—for example, transfer by a previous seller who did not own the property.
What is the title search?
The purpose of a title search is to verify the sellers' right to transfer ownership, and to discover any claims, errors, assessments, debts or other burdens or restrictions on the property.
What is the commitment to insure?
The commitment to insure, sometimes called a “binder,” usually includes a summary of the condition of the title, including title defects, liens, etc.; conditions to be met in order to insure the proposed transaction; and an agreement to issue a title insurance policy upon payment of the premium.
How much does title insurance cost?
You pay a one-time premium which covers you throughout your ownership of the property. Costs vary depending on the price of the property and various issues. |
