When purchasing a home, home buyers should understand the need for title insurance. During the purchase of real estate, buyers must have home owners insurance, and they should have title insurance. The protection offered by title insurance will shield home buyers from the damage already done to the home, restrictions by rights and claims of others, and risks establishes prior to the issuance of title insurance coverage.
Reasons to Purchase Title Insurance
There are numerous reasons for a home buyer to attain title insurance. When the home buyer acquires the new house, the buyer purchases the title or deed to the land and the right to occupy and utilize the space. At this point, the title may be restricted by the rights and claims of others. Title insurance covers the home buyer against the rights and claims of others that could cause financial loss or limit the use of the property. Title insurance involves protection against past events. Title insurance requires a premium of only one payment whereas other forms of insurance require various amounts of insurance premiums. Title insurance eliminates the risks issued prior to the title insurance coverage such as claims. And title insurance covers undetectable problems that may emerge in the future. The job of the title insurance company is to certify the title, prove the title to be transferable, and defend any claims that may arise in the future. The responsibilities of the title insurance company will involve perfecting the title or providing the expenses awarded to valid claims. Since the legitimate claims may be time consuming and expensive, having title insurance will prevent home buyers from experiencing the costs or the stress that come along with the legal proceedings surrounding these claims.
Any rights or claims filed by other parties such as previous owners and title holders are resolved through the title company’s research and investigation of the title. The title company researches the history of the title and an agent investigates any possible material objections regarding the title. The inquiries and explorations into the title may result in the discovery of improper title transfer documents. Examples of improper title transfer records include:
·Documents enclosing inaccurate wording or incorrect names on deeds, wills, and trusts.
·Documents that support outstanding mortgages and judgments.
·Documents sustaining liens against the home and the estate due to unpaid taxes.
·Documents permitting construction on a road or utility line.
·Documents affirming pending legal actions against the estate possibly influencing the purchaser.
·Documents with incorrect notary recognition.
Any matters unidentified during the title agent’s research and investigation may lead to financial difficulties or the loss of the estate. These untraceable predicaments may include:
·Forged signatures on the deed of the estate may lead to no transfer of ownership.
·An unknown heir of a previous owner can attempt to claim the estate.
·Mistakes found in the public records may result in corrections made by the buyer.
Title insurance is a very beneficial home buyer purchase. The title insurance coverage will keep the home buyer from handling any and all complications surrounding the title. Whether obstacles are caused by legal title claims or previous title impediments, the purpose of title insurance is to guard and defend home buyers from any and all arising title problems.