For most Americans, our home is the single largest financial investment we ever make. More importantly, it’s where we raise our families, share time with friends, live our lives. And while ownership of our home may seem very straightforward, our rights to enjoy our property aren’t always as clear. There are literally dozens of ways in which your title to – and your ownership of – the property can be jeopardized. The title insurance industry and the policies it provides exist to ensure that title issues don’t affect your home ownership rights.
We inform you
Land is permanent, but its ownership isn’t. Every property starts out with a bundle of rights that its owner can expect. But over the years, with each new possession of a property, events can take place that affect the title, such as a refinancing, a tax lien, an encroachment by a neighbor, or the marriage, divorce, or death of an owner.
The Title Search
When a buyer and seller agree on a home or land purchase transaction, a title professional searches public records to see if any outstanding matters could affect the new buyer’s rights. Title professionals research records in municipal and county facilities, or in information storehouses called “title plants,” capturing and analyzing even the smallest details. These records include recorded documents such as: judgments, liens, general taxes, utility assessments, special taxes and levies, and other matters that could cost the new buyer money or, worse, affect their property ownership. This process, called a title search, provides warnings of title flaws that must be dealt with before the property can change hands.
We reduce your risk
Once title professionals find these title issues, they then work to remedy any problems that could keep you from having “clear” title. For example, a previous owner may have had minor construction done to the home, but never fully paid the contractor performing the work. Title professionals identify this unpaid bill so that it can be resolved by the previous owner before you take ownership. If it isn’t, you might very well be responsible for this payment as the new owner!
The Hidden Problems
The best title search, performed by the most experienced and capable experts, cannot ensure that no title hazards exist. Some problems just aren’t revealed in public records. Years ago, there may have been an honest mistake in determining the status of title. Or today, a previously unknown heir may come forward to claim ownership of a deceased relative’s property. There might even have been a forged deed that impairs the ownership of the property.
To help protect you in these events, the title professional issues an Owner’s Policy of Title Insurance that insures you against most of these unforeseen problems. So, title insurance companies not only help to remove the flaws that show, they also insure against those that don’t.
We insure your rights
The title insurance policy is what people usually think of when they think of title insurance. For this reason, there are two kinds of title insurance policies: one for owners and one for lenders. An Owner’s Policy is assurance that your title company will stand behind you – monetarily and with legal defense – if a title problem arises after you buy your home. Bottom line: your title professional will be there to help pay valid claims and cover the costs of defending an attack on your title. Receiving an Owner’s Policy isn’t always an automatic part of the closing process, however. Be sure to request one. Because without an Owner’s Policy, you could be liable for these costs and legal fees, even if you prevail in a legal action.
Why Lenders Like It, Too
Your mortgage lender also has a great financial interest in the property you’re buying. Just as you do, lenders rely on title professionals to ensure that they won’t be impacted by unforeseen title problems that could affect them. The Lender’s Policy covers them for the amount of the loan, and declines accordingly as the loan is paid.
We protect your piece of the American Dream
Title insurance isn’t like most of the things we Americans buy. In fact, it’s not exactly a product, but more a process. It’s different from other kinds of insurance too, in that the premium you pay just once buys coverage that lasts the entire time you, or your heirs, own your home – whether it’s five years or 105!