Title insurance is an insurance policy that protects your legal right to own, possess, use, control, and dispose of land.
Transferring a real estate title can be complicated because land is permanent and the usage of land and the rights to its use can change over the years.
A title search is a detailed examination of historical public records concerning a property. These records include deeds, court records, property and name indexes, and many other public documents.
There are two main types of title insurance policies: a lender’s policy and an owner’s policy. A lender’s policy is typically required for a mortgage, it financially covers the amount of the loan and provides protection to the lender. An owner’s policy protects the landowner against a title loss, which ensures the value of the property. With owner’s title insurance, if a claim is made against the title, the underwriter must pay any and all costs associated with defense against the challenge. If unsuccessful in that defense, the underwriter reimburses the landowner for any reduction in the value of the land.
Homeowner’s insurance typically provides protection for the dwelling and its contents. For instance, if a fire destroys your home, you can rebuild and buy new possessions. However, if the title to the land fails, you could lose the right to inhabit your home as well as the land it occupies.
Title insurance charges vary in different parts of the country. However, you pay for an owner’s policy of title insurance only once; there are no monthly premiums.
The lender’s policy of title insurance lasts until the mortgage is paid in full. An owner’s policy of title insurance lasts for as long as you or your heirs retain an interest in the property.
You can obtain title insurance from any licensed title insurance company or their agents. Oh and by the way… we’re one!