Understanding Title Insurance and Why You Need It
There's a long list of costs on your closing statement. You're scanning through them wondering, "How many of these can I eliminate to cut down on my closing costs?"
Then you see a line for homeowner's title insurance. "Hmmm....maybe that one can go."
Before you reach for the red ink pen to cross it off your closing costs list, make sure you understand the value, the protection, and the peace of mind it can bring.
Here's what you should know first.
Then you see a line for homeowner's title insurance. "Hmmm....maybe that one can go."
Before you reach for the red ink pen to cross it off your closing costs list, make sure you understand the value, the protection, and the peace of mind it can bring.
Here's what you should know first.
What is Homeowner's Title Insurance?
Before you delete title insurance as an unnecessary expense, first understand what it is.
Homeowner's title insurance protects you against possible future claims against your home related to ownership of the property.
Lenders require lender's title insurance because they are not willing to risk their investment over the possibility of a dispute over homeownership.
And neither should you!
Homeowner's title insurance protects you against possible future claims against your home related to ownership of the property.
Lenders require lender's title insurance because they are not willing to risk their investment over the possibility of a dispute over homeownership.
And neither should you!
But Doesn't the Property Title Search Cover Me?
Your Waynesboro title company will do a title search of the property you want to purchase. If no defects are found in the search, your property will get what is known as a "clear title."
That simply means there are no legal claims against the property that the title searcher could find. There were no liens, levys from a lender or creditor, no taxes due on the property, etc. The title is clear.
But therein lies the catch. Not all defects are recorded. What if an heir comes forward claiming that the deed was forged? Or what if it's later learned an heir has a life estate in the property? And, oh by the way, you have to move out!
In short, you've got a problem that's going to cost thousands of dollars to resolve.
That simply means there are no legal claims against the property that the title searcher could find. There were no liens, levys from a lender or creditor, no taxes due on the property, etc. The title is clear.
But therein lies the catch. Not all defects are recorded. What if an heir comes forward claiming that the deed was forged? Or what if it's later learned an heir has a life estate in the property? And, oh by the way, you have to move out!
In short, you've got a problem that's going to cost thousands of dollars to resolve.
Title insurance protects you from
what isn't legally recorded.
Title insurance protects the new homeowner from hundreds of common legal problems. Here's just a few of the legal problems that Lilly Title & Settlement covers. For a complete list, please click here and scroll down the page.
- Mechanics lien
- Forgery, fraud
- Defective recording of document
- Someone else has an interest in your title
If you have title insurance, the company will handle the legal matter. If you don't have title insurance, you could be looking at thousands of dollars in legal fees, and the possibility of losing your home.
For the one-time investment of a couple of hundred dollars, title insurance allows you to move into your new home confidently.
Lenders and Title Insurance
Banks are all about protecting their investments and making money.
They are some of the most conservative financial businesses on the planet!
If your lender thinks it's a good idea to protect their investment, isn't it a good idea for you to protect yours?
Lilly Title & Settlement is a full service title and real estate closing company that covers Staunton, Waynesboro, and Augusta County. Got questions? Call us! 540-414-8763
They are some of the most conservative financial businesses on the planet!
If your lender thinks it's a good idea to protect their investment, isn't it a good idea for you to protect yours?
Lilly Title & Settlement is a full service title and real estate closing company that covers Staunton, Waynesboro, and Augusta County. Got questions? Call us! 540-414-8763
RSS Feed