It can be stressful to close on a real estate transaction. Buying a home could be the single largest purchase of your life and you want to make sure you get each step right. A good title company will explain to you that title insurance is a necessary purchase to protect yourself from anything that could go wrong…even after the closing.
When making a purchase this large, you want to protect your investment the best you can. When you purchase title insurance, it protects you from hidden title hazards that can emerge and impact your investment. Despite all of the hard work and dedication that goes into a title search and examination, there are always issues that could arise and impact your deal.
Some issues that could impact your new property transferring to you would be if the deed was found to have a forged signature or if an heir to a previous owner of the property came forward to lay claim on the property. There could also be mistakes in the public records or if the instruments were executed under an expired or fabricated power of attorney, the deal would be impacted.
Title insurance also protects you from defects that might already exist in the title. Any number of documents can present concern if there are mistakes in them, from deeds, wills and trusts to outstanding mortgages, judgments and liens. Easements that allow construction of a road or utility line, pending legal action against the property, or even incorrect notary acknowledgements can all impact your real estate transaction. However, you will be protected in all of these situations with title insurance.
There are two types of title insurance: lender or mortgagee protection, and owner’s coverage. With lender or mortgagee protection, the title insurance protects you if there is a claim made against your property, helping you secure a legal defense, if necessary, and reimbursing you for your loss if the claim is proven valid.
With owner’s coverage, title insurance covers the ownership of the property for the benefit of the current owner, for as long as they own the property. Both lender or mortgagee title insurance, as well as owner’s coverage title insurance are both one-time premiums, paid at the time the policy is issued. Most title companies, such as Florida Home Title Company will offer a discount when both of the title insurance policies are purchased at the same time.