Get Title Insurance: Do You Need Title Insurance?

Get Title Insurance: Do You Need Title Insurance?

The question often asked is if a buyer needs to purchase title insurance for a property. A residential owner’s policy of title insurance provides protection to the owner. Prior to issuing a title policy, the title company performs a search and examination of the public records to discover any matters affecting title to the property. A thorough search an’t discover hidden title hazards (i.e. forgery, fraud, human errors, defective documents) which may affect the marketability of your home at the time of selling. When purchased the title insurer defends and protects your title to the property, at their expense, should a claim arise.

The lender’s policy protects the lender against claims that affect the security of the mortgage on the property. The lender’s policy terminates when it is paid off. A lender’s policy provides no protection for the homeowner.

Owner’s policies remain in effect providing protection so long as yourself or your heirs have an interest in the property, or an obligation under a warranty in any transfer of the property.

Even on new homes you need title insurance because of possible defects in the chain of title, could threaten your possession to the property. Also many parties supplied labor and materials for your new home, have they have lien rights on the home which may be addressed during or after the closing process.