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Frequently Asked
Questions
What is Title Insurance?
It's PROTECTION
against defects which affect the title to your home or business.
BUT...
occasionally a
HIDDEN DEFECT in the title or a MISTAKE in a prior Deed, will or
Mortgage may give someone else a legal claim against your property.
Why is Title Insurance Important?
Because it
protects the INVESTMENT you've made in your home or business.
If a claim is made against your property, title insurance can save
you TIME and MONEY.
WHO IS COVERED by Title Insurance?
(The Lender) When
you borrow money to buy property, you are typically required to buy
title insurance to cover the outstanding balance on the mortgage
for. But the lender's title policy does not protect you.
(The Buyer) It's a good idea to get your
own title insurance policy for protection in case there's a claim
against your home. Then your investment is safe, too.
What RISKS ARE COVERED?
The policy is
underwritten to include or exclude specific risks, depending on the
circumstances. But generally the title policy covers 4 "HIDDEN
RISKS":
-
ERRORS IN THE PUBLIC RECORDS...
such as incorrect information in deeds and mortgage regarding
names, signatures or legal descriptions.
-
JUDGMENTS, LIENS and MORTGAGES...
claims against the property or the seller which become the
new owners responsibility after closing, such as unpaid taxes,
assessments, and other debts to creditors.
-
CLAIMS TO OWNERSHIP... By the
spouse or a former owner or by "the missing Heir" or a deceased
owner who did not receive his share of the estate.
-
INVALID DEEDS...
Transfers by previous sellers who did not actually own the
property, or by previous owners who were minors or not mentally
competent.
MANY OF THESE PROBLEMS MIGHT NOT BE
DISCOVERED IN A ROUTINE SEARCH OF THE PUBLIC RECORDS. |
