Title Insurance and Why You Should Consider A Policy for Your Home

What is title insurance? It’s a great question and there’s a good answer for it. Title insurance protects homeowners (and mortgage lenders) against any property loss or damage they might experience because of liens, encumbrances or defects in the title to a property. Put another way, homeowner’s insurance protects only the structure and belongings of your home, but a title insurance policy protects you from unexpected claims against your property ownership. And that’s only the beginning. Here are three huge reasons why you and your family should seriously consider title insurance:

  1. Eternal Protection – For only a one-time fee, a title insurance policy protects your property rights for as long as you or your heirs own your home. A small price to pay for the tremendous value it provides.
  2. Covers Unexpected Title Claims – If you are buying a home, there are many hidden issues that may appear only after you purchase your home. Getting an owner’s title insurance policy is the best way to protect yourself from unforeseen legal and financial title discrepancies.

Unexpected title claims include:

•  Outstanding mortgages and judgments, or a lien against the property because the seller has not paid his taxes
•  Pending legal action against the property that could affect you
•  An unknown heir of a previous owner who is claiming ownership of the property
•  Lost or forged deed
•  Transfers by incapable people
•  Incorrectly indexing in the land evidence records
•  No right of access to your property

3. Peace of Mind– If you’re buying a home, a title insurance policy lets you rest assured, knowing that you’re protected from inheriting any existing debts or legal problems, once you’ve closed on your new home

It’s a No Brainer.  Each year, more than 80% of America’s homebuyers choose to get an owner’s title insurance policy. A home is probably the single largest investment you will make in your life.  You insure everything else that’s valuable to you, including your life, your car, health, pets, etc., so why not protect what is arguably your largest investment?

Benefits of an Expanded Title Insurance Policy

For residential property containing a one-to-four family dwelling, and for an additional 10% of the title premium for a standard Owner’s Policy, you may obtain an Expanded Protection Owner Policy, which can provide additional coverage beyond that provided in the standard Policy.  These protections include:

  • Coverage against loss due to forced removal of an existing residence because the residence:
  • Coverage if you lose your property because of a violation of any covenant or restriction that occurred before you acquired the property
  • Coverage against loss due to forced removal of the existing residence because any portion of it was built without a building permit
  • Coverage against loss caused by the refusal of a buyer to purchase, or the refusal of a lender to make a loan, or inability to obtain a building permit for remodeling, because of a violation of existing subdivision law
  • Coverage against loss resulting from future encroachments onto your property (other than boundary walls or fences)
  • Coverage against loss by reason of future forgery of an instrument by which someone else claims to own your land or have a mortgage or some other lien on it
  • Survey coverage (coverage against loss resulting from adverse title matters that would have been disclosed by an accurate survey) may, in certain cases, be available without the need to obtain a survey

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