A: Title Insurance is the modern method of Real Estate Protection. A policy of Title Insurance protects the insured against a partial or total loss arising out of defects, liens and encumbrances in the title to Real Estate. Q: Why Do I need Title Insurance? A: Your Real Estate Purchase is an important transaction. It is something that needs to be protected from hidden defects and liens. Some of th
ese defects found while searching are errors in the public records, unpaid taxes, legal incompetency or parties, fraud, forgery, outstanding dower rights, defects in the execution of instruments, and many others. These problems, or Similar issues can limit your enjoyment and bring great stress and financial loss. An Owner's Policy can give you a safeguard against loss, arising from flaws and defects already existing in title. Don't stress about the history associated with your property. Let the Title Insurance Policy protect you from any risks that may occur and give you peace of mind! Q: What is the difference between an Owner's Policy and a Lender's Policy? A 1: An Owner's Policy protects the interest of the owner of real estate and lists the name(s) of the new buyer as the insured party. As the new buyer, you will want assurance from the seller that the title is marketable and free from any liens, that could create problems. The Owner's Policy assures that title is marketable and provides for defense of the title, at the expense of the insured company. A 2: A Loan Policy protects the interest of the mortgage lender and lists the lender as the insured party. All lenders require the borrower to provide proof and assurance that the loan being applied for will be in the correct lien position. If the validity of the lien of the mortgage is challenged or questioned, the policy provides for the defense of the mortgage interest. Q: What is the cost of Title Insurance? A: The cost depends upon the face amount of the policy issued. The face amount is normally the market value of the real estate; in the case of an Owner's Policy and the amount of the loan; in the case of the Mortgage Policy. Only one premium is paid and the protection lasts as long as the insured has any interest in the property. When the property is transferred or sold at a later date, and an existing Owner's Policy is surrendered, an Owner's Policy will be issued protecting the new purchaser at a reduced premium. When an Owner's Policy and Loan Policy are issued simultaneously on the same land, special reduced rates are applicable. Note: In this area, is is customary for the SELLER to incur the cost of the Owner's Policy and the BUYER to incur the cost of the Loan Policy.
