Preferred Land Title, LLC
What is Title Insurance?
Title insurance is a policy of insurance that insures an owner or a lender against defects in title The information provided to a prospective purchaser or lender is valuable in that it discloses who has a right to a use or interest in the property other than the seller and the nature of that right. A purchaser should always protect their equitable interest in the real estate with an owner's title insurance policy no matter what the lender requires for its loan.
Do I need Title Insurance?
YES, the most important investment you'll ever make is the investment in real estate. You owe it to yourself to protect it!
What does title insurance protect against?
-
False impersonation of the true owner of the property
-
Forged deeds, releases or wills
-
Undisclosed or missing heirs
-
Instruments executed under invalid or expired power of attorney
-
Mistakes in recording legal documents
-
Misinterpretations of wills
-
Deeds by persons of unsound mind
-
Deeds by minors
-
Deeds by persons supposedly single, but in fact married
-
Liens for unpaid estate, inheritance, income or gift taxes
-
Fraud and Forgeries
-
Unreleased Mortgages
-
Unpaid Taxes or Assessments
-
Unpaid judgements or Liens
This is only a few of the most common hidden risk that can cause the loss of title or create an encumbrance on title
How can there be title defects, if the title has been searched and a loan policy issued?
Title insurance is issued after a careful examination of copies of the public records. But even the most thorough search cannot absolutely assure that no title hazards are present, despite the knowledge and experience of professional title examiners. In addition to matters shown by public records, other title problems may exist that cannot be disclosed in a search.
What is the danger of loss?
If the lender has title insurance protection and the owner does not, what possible danger of loss exists?
As an example, assume real estate was purchased for $100,000. A down payment of $20,000 is made, and a lender holds an $80,000 mortgage lien, or beneficial interest. The lender acquires title insurance protecting the lender's interest up to $80,000. But the purchaser's down payment of $20,000 is not covered.
What if some matter arises affecting the past ownership of the property?
The title insurance company would defend and protect the interest of the lender. The purchaser, however, would have to assume the financial burden of his or her own legal defense. If the defense is not successful, the result could be a total loss of title.
The title insurance company pays the lender's loss and is entitled to take an assignment of the borrower's debt. The purchaser loses the down payment, other equity in the property that may have accumulated, and the property. And the balance on the note is still due!