What is Title Insurance on Real Estate?
Title insurance protects both real estate owners and lenders against loss or damage occurring from liens, encumbrances, or defects in the title, or actual ownership of, a property.
What do title companies do?
Title insurance companies provide protection against hazards of title and unlike other kinds of insurance that focus on possible future events and charge an annual premium, title insurance is purchased for a one-time payment and is a safeguard against loss arising from hazards and defects existing in the title – prior to your insured ownership.
There are two kinds of Title Insurance
- Owners coverage
- Lenders, or mortgagee, protection
Owners title insurance ordinarily is issued in the amount of the real estate purchase and lasts as long as the insured – or his/her heirs have an interest in the property concerned. This may even be after the insured has sold the property.
Lenders title insurance decreases and eventually disappears as the loan is paid off. Most lenders require mortgagee title insurance as security for their investment in real estate, just as they may call for fire insurance and other types of coverage as investor protection.
Read more here: http://www.nationaltitlecompany.com/resources/buyerssellers/
Understanding Title Insurance – and Why You Need It
Unlike most insurance policies, you pay just a one-time fee and your property is covered for as long as you or your heirs own it. If you are taking out a loan to buy your home, the lender will require you to purchase lender’s title insurance to cover its investment. Essentially, the lender wants to make sure this is a legitimate deal with someone who has the full right to sell the property to you. But the lender’s policy will only cover the outstanding amount of the loan at the time a claim is made. You also want to make sure you have a policy that covers your interest, called an owner’s policy. When purchased together, the owner’s policy is a relatively inexpensive addition.
As you’ve probably guessed by the one-time fee, title insurance doesn’t work the same way most other policies do. The truth is that title insurers rarely have to pay out on claims. But that doesn’t mean you’re paying them for nothing. To the contrary, unlike other types of insurance, title insurance companies mostly incur their expenses upfront and help prevent any kind of title surprise later on.
While you are in the escrow phase of your purchase, the title insurance company will conduct a comprehensive search to make sure there are no such surprises lurking in the dusty files in some forgotten corner of the county courthouse. The title company searcher looks at deeds, wills, and trusts, tracing the history of the property back many, many years. The search can be manual or on a computer or both, depending on records in your area. Among the important questions is whether all past mortgages and liens have been paid. Does anyone hold an easement? Are there any pending legal actions? That’s where most of your insurance premium goes – to conducting that search. Then, just to make sure you’re protected in case they missed something, title insurance will cover your losses if it turns out later that they missed something.
In some areas, the cost of the title search and the title insurance are separate, while in other regions they are lumped together.
Read more here: https://www.zillow.com/home-buying-guide/what-is-title-insurance/
Artesian Title - Closing with a Concierge Touch
Title companies tend to be the last thing a potential new homebuyer—or even Realtor—thinks about in all the excitement of buying and selling a new home. We are often a last minute addition to the closing—a necessary legal checkmark on a long list of boxes. Why? Because until now, title companies have been somewhat of a commodity product, with no real compelling reason to choose one company over another. Artesian Title has at least three real reasons that make a compelling case for choosing us: Concierge Service, Florida Legal Specialists, and an up to 20% Savings.
Artesian Title provides closings with a concierge touch. Our mobile, licensed “Concierge Closers™” are yours when and where you need them. They come to you when you call. They work to your timetable. They communicate in ways you prefer—They’re ready to answer all your questions and provide every document at a moment’s notice Add that to our weekly email—Peace of Mind Fridays™—that provides a progress update on the status of your title case and the real differences with Artesian are truly significant.
Read more here: Florida Title Insurance
Title insurance protects your biggest investment for not a lot of cost
Insurance is one of those necessary evils in life. You purchase a policy and hope you never have to file a claim. And in the meantime, you send a regular payment to your insurance company “just in case.”
That’s true of all but one type of insurance. Unlike other policies, title insurance is a one-time fee paid at closing. It protects your financial stake in the property you’re buying should an unforeseeable claim arise in the future. A claim could stem from anything from fraud or identity theft to encroachment or mortgage liens.
Without an owner’s title insurance policy, the legal costs to hash out a title claim would be in the tens of thousands of dollars paid directly out of your pocket. Not to mention you could lose the money you’ve invested in your property such as your down payment and any improvements you’ve made.
What Does Owner’s Title Insurance NOT Cover?
Before we get into details, we should note that each title insurance policy is different. As a result, it’s difficult to make generalizations that will apply to every policy. That being said, here are some of the items that are typically not covered in a general title insurance policy:
Any defects created after the issuance of the policy, or defects that you create.
Issues arising as the result of failing to pay your mortgage.
Issues arising as the result of failing to obey the law or certain covenants.
Specific taxes and assessments.
Violating zoning or building ordinances related to land use, improvements, or environmental protection.
Restrictive covenants that limit the use of the property.
Condemned land.
Claims from others who might have rights to your property if a body of water (river, stream, lake, etc.) is on or near the property.
It’s always important to communicate with your title company about these potential issues and to make sure you fully understand what is and is not covered under your policy.
Read more here: https://cptitle.com/owners-title-insurance-not-cover/
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