Feeling a little confused about certain aspects of your upcoming real estate transaction?
Here’s what you need to know about Title Insurance…
A title is a legal right to the possession of property. Title insurance protects you from claims of ownership, outstanding debts of previous owners, and other title problems that you may not have known about before you purchased the property.
It’s important to have title insurance because you want to be protected from issues or problems with the title that could pop up months or years after you buy the property, such as:
- forged deeds, releases, wills, or other legal documents;
- failure of spouses to join in conveyances;
- undisclosed or missing heirs;
- deeds from defunct corporations;
- mistakes in recording legal documents;
- liens for unpaid taxes including estate, inheritance, income or gift taxes
- HOW MUCH?
It’s a one-time only expense that is directly related to the value of your home (usually a little less than your annual car insurance). It is paid at the time you buy your home but provides complete coverage for as long as you own the property.
If you are a buyer, seller, lender, real estate broker, attorney or home builder – chances are you need title insurance.
- WHAT TYPE?
Here are the two most common types of policies that protect buyers:
- Lender Policy: If you want to borrow money to buy your home, the lender will require that you purchase a lender’s policy. It covers up to the amount of principal on your loan. This kind of title insurance will repay the balance of your mortgage if a claim against your property voids your title.
- Owner Policy: Unless you specifically reject it in writing, a title company will automatically issue you an owner policy when you buy a home and get a lender’s policy. This kind of title insurance protects you from the risks listed in the policy and covers up to the value of the property at time of purchase. If you want it to cover any increases in your home’s value in the future, you must buy an ‘increased value endorsement’.
For all your real estate needs, contact expert DFW realtor, Stacey Perry with Keller Williams Realty, today!
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