For most Americans, their home is the largest single investment that they will make in their lifetime. Buying title insurance to protect the basic proof of ownership (the title) is a relatively low-cost means of having peace of mind and ensuring that your commercial or residential title transfer is free of any defects.
At Southern Title, we issue a title insurance policy after thoroughly abstracting the property’s history of ownership and transfer at the courthouse.
Title insurance guarantees that no errors have been made in the title search as well as that there are no errors in the public records.
It also protects against undisclosed title defects that, no matter how thorough a search is made, cannot be discovered from the public records.
Title insurance provides the safety net that national lenders require to make mortgages across the country with confidence. Local practices and activities differ across the United States, and any lender that is not familiar with them may be in fact hesitant to make a loan without some type of protection. That is precisely where title insurance comes into play, reducing the risks to everyone in the transaction.
For sellers, title insurance allows quick and easy closings, as they must prove to a buyer that they have title to their house with no liens or other encumbrances. The title insurance process requires a title search and insurance to the buyers in the amount of the sales price, which proves the validity of their title claim with an insurance guarantee.
With an insured property title, potential delays related to passing your property are reduced. In the case of a challenge to your ownership claim, the rights of the insured side are protected even if it means going to court. And if the claim is established, the loss is fully paid up to the limits specified in the policy.
Should a claim be made against your property, title insurance will, according to the terms of your policy, assure you of a legal defense as well as pay all court costs and related fees. In addition, if the claim proves valid, you will be reimbursed for your actual loss up to the face amount of the policy.
Title insurance provides valuable protection for property buyers. Like all forms of insurance, however, it does not cover every conceivable problem, so it is important to understand its limitations.
Title insurance is based on examination of the county real estate records, and generally will not cover problems arising from facts outside of the recorded chain of title. One common problem not covered by title insurance is boundary line issues, which would be revealed by a survey of the property (for example, it turns out that your fence is actually two feet onto your neighbor’s property). Unrecorded mechanics’ liens and unpaid public utility bills are other examples.
The title insurance policy will describe many of the situations it does not cover, and these same limitations will generally be found in an attorney’s title examination. A qualified real property attorney can assist in helping a buyer understand the limits of a title policy and can take care of issues not covered by the policy.
