All Forum Posts by: Linda N.

Thanks for laying that out for me Rick. Since there's a 50 - 50 chance we'll want to sell in a few years and would want the sale to be as easy as possible (meaning no owner financing, etc) , it seems to make sense to get the insurance now.  It's nice to know the options.  

Many thanks! Your discussion was most helpful in expanding my understanding of the title insurance business.

Thank you for your replies.  I am going to purchase the title insurance - I just wondered if it was really needed.  The initial title search a local attorney did for me before the auction did not pick up any problems, thankfully, the more complete search the title company did also showed no problems.  I thought the risk would probably be worth it since I've watched this house and the owners (the original builders) for over 20 years with no big surprises, the taxes were up to date, etc. Only when they passed were the son's not able to keep up the refinance payments. 

The search and premium are $430.  The insurance policy covers the up to date and clear title as found by the search to the cost of the purchase. Otherwise, I am asked to attest that no other actions have been taken that would have resulted in a lien against the property. 

I'm guessing that this is typical. 

Thank you again for such clear discussions of the issues.

I've had a title search done on a house I bought with cash from a substitute trustee auction.  The title search came up clean. My plan is to hold the house and let a relative live in it.  At some time later I might want to rent to non-family or sell. 

I'm wondering if I misunderstand what title insurance does and if I even need it.

Thanks - yes, this is a super abbreviated version of

https://www.biggerpockets.com/forums/311/topics/301827-total-newbie---need-help-with-title-insurance

I had an attorney do an informal search which he said showed no problems but was not a formal title search.  For this, he charged me nothing.  Since then, I've had a title search done by First American title.  I have questions about what they've sent me that I detailed in another post just a few minutes ago that is also in the buying and selling real estate category.  If you have a moment to look at it and could help me understand how the whole title search/insurance process works, I would be most appreciative.

Thank you for your reply.

Sorry - the paragraph above should have said THIS -

why does the title company want me to sign a sellers/owners affidavit and indemnity that basically says that if there are no liens or other issues that might cause a problem down the road with the title, and that I would have no legal recourse with them for not finding the problem in their search?

Hi, I purchased a house next door to my home.  It was sold on the courthouse steps as a foreclosure by a substitute trustee.  I have watched this house and the deceased owners for years - the sons who inherited it could not keep up the payments on it.  I did not have a title search done before the purchase.

I contacted First American title about doing a search and purchasing an owner's policy.  They've sent me the documents (original title deed, subsequent refinance title deed, substitute trusteee's deed for the forclosure, and the deed that shows I purchased the house).  No outstanding debts were found, taxes paid.

However, the original owner's sons are still in the house. We are midway in the eviction process to take possession of the property.  I have had the deed registered with the county.

Sorry this is so long but this is what I can't figure out - why does the title company want me to sign a sellers/owners affidavit and indemnity that basically says that if there are no liens or other issues that might cause a problem down the road with the title, and that I would have no legal recourse with them for not finding the problem in their search?

AND

That there is a laundry list of evidence they want like proof that the notice of foreclosure was mailed with a return receipt, notice published 3x, evidence that the sale (to me) was compliant with laws, that the foreclosed upon (the deceased were named in the sale) had not filed for bankrupcy protection, and that the permises have been surrendered to me at the time of the recording of the substitute trustees deed.  All this is along with a list of other not so troublesome issues in Schedule B - Requirements (which I'm presuming are boiler plate).  Schedule B - Exceptions seem reasonable enough and not a problem.

AND

I'm wondering if I need the insurance part since they seem to be legally non-liable for anything that might emerge beyond what they have sent me details of and I have to sign the affadavit to seal the deal with the title company for insurance.  They want me to state (sign) that no activity has occurred in this house for the past year that might result in a lien - how would I know?  Actually, I have watched what has gone on at this house every day for the past year and there has been no construction so my guess is that this is not a problem but do they really expect me to attest to something that I cannot possibly know?

So very sorry this is so long - now you know how I've sort of stumbled into this situation.  I have the title search, do I need the insurance? Please help me understand so I'll do better the next time.

Many thanks.

Yup, as I thought but their paperwork says they may decline or change their minds at any time.  What a deal for the trustee. Many thanks!

Many thanks all for your quick replies.  My plan is to talk to the insurance agent first thing Monday AM and tell her to find a company that doesn't have objections if this issue is based on some unfounded worry.  I don't know the source of the underwriter's concern yet.  All the houses built in this little neighborhood were built around the same time.  I wondered if the fact that it's a foreclosure might be an issue with no access until the owners get out might be part of the issue. 

I bought a forclosure (as is) that was auctioned at the courthouse steps, paid cash, and am awaiting a deed from the trustee.  The deed will take around 10 days or so according to the trustee.  I have a receipt for the purchase but I think I've confused myself about the actual date of sale that will be on the deed.  The date of the purchase or something else (like when the trustee processed the paperwork)?

I know this is really ignorant - be gentle.