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THE IMPORTANCE OF TITLE INSURANCE


THE IMPORTANCE OF TITLE INSURANCE

With all of the stress and expenses of buying a new home, title insurance is probably the  last thing you ever think about.   In my work as a settlement agent, I can say that I only     get a call in about one of every twenty cases. Most buyers only really want to know how much it costs.

Like most insurance, title insurance provides protection to the homeowner against a loss. This loss would arise from any problem associated with the title to the property being different than it was insured.  The buyer should understand that there are different types of title insurance.

The lender's policy (which is required by just about every national lender) only protects the lender for the amount of the loan. This covers the lender for any loss it may suffer if there is a claim. The owner's policy is what the buyer needs to protect his or her investment in the property. The owner's policy would provide clear title coverage to the property and protect against risks such as forgery and fraud; defective recordation; undisclosed, but recorded liens, mortgages, easements and use restrictions; a party's lack of competency, capacity or legal authority to act; a missing or defective legal description and missing parties to a deed.

The instances in which problems arise are rare and it is the duty of a quality title     company to produce clear title for both the lender and buyer in any given transaction.    The reason this title insurance coverage is so important to the buyer is that it protects the buyer in these matters literally forever.  There is no ongoing annual expense or premium for the continued coverage the buyer experiences.  By incurring this one time title insurance expense, the buyer is covered for as long as they are in possession of the property. Simply stated, this onetime expense is well worth  the value  and protection  that  it provides.

For individuals that are in the military this coverage can have additional value.  With so many cases in which people are working remotely and in some cases from different cities or countries, this security and peace of mind is invaluable.

Mark Taubenfeld VP of RESOURCE TITLE LLC