As real estate is the nation’s largest market, its purchase and sale are essential to the U.S. economy’s health. However, these transactions are never without risk. That’s why title insurance has been protecting American homeowners for more than 130 years.
When a piece of real property is financed, purchased, or sold, a record of that transaction is generally filed in public archives. Likewise, other events that may affect the ownership of a property are also documented and filed. These may include liens, levies, and encumbrances. When a buyer purchases title insurance, the title company searches these records to find and remedy, if possible, issues that may affect the purchaser’s ownership.
Title Search and Exam
That’s where title insurance differs from traditional insurance models. When you purchase a policy insuring you for matters related to your car or health, the insurance company assesses the risk involved of insuring you and bases its premium on the risk being assumed. With title insurance, the insurer first works to identify the status of ownership, liens, and other matters affecting title by collection documents affecting title from the public records that are statutorily identified for the recording of real estate transactions. This process is called the search. Once the search is complete, the title insurance underwriter can determine if the title is insurable and list the exceptions from coverage and requirements to ensure
Of course, even the most skilled title professionals may not find all the title problems. Other risks include more difficult to identify, such as title issues resulting from errors, forgeries, undisclosed heirs, and other unforeseen problems. That’s one reason why your title insurance policy can play a key role in protecting your real estate investment.
It would be best if you had it.
When you purchase a new home or another piece of real property by securing a mortgage, your lender will require you to purchase a loan policy of title insurance. The policy insures the lender against covered title defects up to the amount of the deal. Call me anytime with any questions; if I can help you, I’m happy too. 602 299-1743