Finally, after years of earning and saving money, you are the proud owner of a home. Negotiating with the seller was a piece of cake. Everything is perfect, you tell yourself during the housewarming party you’re hosting. Then a brief warrant appears asking you to vacate the property, turning the dream into a nightmare. It turns out that his new house is involved in an old legal case.
Many property owners end up in such unexpected legal battles because they were unaware of title insurance or chose to ignore it.
What is title insurance?
It is homeowner’s insurance coverage for losses suffered due to title defects, including outstanding property taxes from previous owners, forged or invalid title deeds, lack of access to the property, heirs who have a valid claim to the property but have not come through, and other factors that come to light after the property has been purchased.
Since properties change hands quickly, buyers tend to overlook crucial details. This can lead to problems later, such as court settlements, legal fees, and in some cases, loss of property. Taking this type of insurance will help you avoid these types of problems.
The Process of Obtaining Title Insurance
When title insurance is taken out on a property, a title search is conducted prior to purchase. An experienced property attorney or title insurance company representative will usually do the searching. They perform extensive checks on documents filed with the local land records office, to make sure the property is free of existing title defects, such as liens, property taxes, outstanding mortgage, defects from previous property transactions, and other issues. that threaten the property of the insured.
If the property passes this verification, the insurance is granted and the property can then be purchased. The responsibility of having done a thorough search of the property now rests with the insurance company. Once the insurance is granted, any loss incurred defending the title will be taken care of by the firm. The insurer will not only cover her legal fees, but will also reimburse her for the amount she invested in the property in the event it is repossessed.
Choosing the right insurance company
Insurance rates vary from company to company. Shop around and compare the different policies on offer to get the best deals on your property.
When selecting a company, be sure to start by talking to some of their customers. Do your homework. Gather information about the policies that are offered. Some companies offer discounts in certain cases. Find out if you are eligible for them. Information about how the company resolves your title disputes and their success rate will help you make a decision.
Another thing to do when purchasing this type of insurance is to make sure you understand what the policy offers. If you are not familiar with the legal aspect of the process, it is recommended that you have a reputable attorney verify the document before signing it.
With property scams increasing by the day, title insurance for your property will give you peace of mind. Plus, if title is ever contested, having secured title won’t leave you battling it out in court.