Why do you need Title Insurance?
Buying a home is likely the most important investment you will ever make. Title insurance is
used to ensure the credibility of the “record” title to a property as it is recorded in the registry of deeds. While a careful review of a property’s deed is usually performed by a certifying attorney before closing, defects can, and do, still go undetected. Your lender requires a loan policy to insure its mortgage interest in your property against title defects and other risks.
Although the premium for the load policy is usually included in your closing costs, it does not protect you. Your best protection against potential title defects that could deprive you of your ownership right is an owner’s tile insurance policy.
For a one-time premium, an owner’s policy remains in effect for as long as you or your heirs own the property. When you want to sell or refinance your property, the policy insures against loss or damage that you may suffer if the new buyer or lender challenges your titles as marketable. In the event of a claim, the owner’s policy will either correct covered title problems, or reimburse you for insured losses and will defend against any lawsuits attacking your title as insured.
An owner’s policy may save you thousands of dollars in legal costs. Owner’s coverage takes the risk out of acquiring property and gives you the ultimate in peace of mind. An owner’s policy insures against title defects that would not be found despite the most thorough search of public records, such as:
- Forged documents
- Unknown creditors
- Clerical errors in public records
- Mistakes in recording
- Incapacity of a grantor
- Undisclosed or missing heir
- Missing signatures