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Understanding Title Insurance

Possible hidden title problems can include

When buying a home, you want to be sure the property you are buying is yours, no strings attached. Other than your mortgage holder, no one else should have any claims or restrictions against your home. That's where title insurance comes into play. 

Title insurance is issued after a careful examination of the public records. Despite the knowledge and experience of professional title examiners, even the most thorough search cannot absolutely be accurate. Title insurance eliminates any risks and losses caused by faults in title from anything that happened before you owned the property.

Possible hidden title problems can include

  • Undisclosed heirs
  • False impersonation of the true land owner
  • Fraud
  • Probate matters
  • Deeds and wills by persons of unsound mind
  • Mistakes and omissions resulting in improper abstracting
  • Forfeitures of real property due to criminal acts
  • Documents executed by a revoked or expired Power of Attorney
  • Defective acknowledgements due to improper or expired notarization
  • Forged deeds, mortgages, wills, releases and other documents
  • Deeds by minors
  • False affidavits of death or heirship
  • Rights of divorced parties
  • Conveyances by undisclosed divorced spouses
  • Deeds by persons falsely representing their marital status
  • Errors in tax records
  • Adverse possession

Frequently Asked Title Insurance Questions

Is title insurance like homeowners insurance?

No, title insurance is different from other types of insurance, such as home, auto, or health that covers you against losses that occur in the future. Title insurance protects against losses from ownership problems that arose before you bought the property, but were not known at the time. Title insurance does not protect against any future faults, but does protect you from risks or undiscovered interests.

Why does the seller need to provide title insurance?

Any purchaser will need evidence that their investment in your property is free of title defects. The title insurance policy that you provide is a guarantee that you're selling a clear title to your real estate, without any legal attachments that might limit or jeopardize ownership. It will reassure your purchaser that they are protected from any risks or losses and could help you close the deal.

Why does the buyer need title insurance?

Without title insurance, you may not be fully protected against errors in public records, hidden defects, or mistakes in examination of the title. As a result, you may be held fully accountable for any prior liens, judgments or claims brought against your new property. If this should occur, your title policy insures that you will be defended at no cost against all covered claims up to the amount of the policy.

How much does title insurance cost?

The insurance commission approves and controls the premiums for title insurance policies. The premiums are paid only once and the cost depends upon the purchase price of the property. The policy amount must be equal to the purchase price. To get an estimated cost, you can use our online calculator.

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