Title Insurance 101

 

Are you buying a home and unsure about exactly what title insurance is and what it does for you? Read on to learn about the key concepts home buyers should know about title and title insurance.

Title

• What is it? Title is the right of ownership to your property.
• Why does it matter? Title ensures that you will not inherit any existing legal issues or debts from the property’s previous owner, and that nothing will interfere with your property rights in the future.
• How do I benefit? If your title is clear, you are free to modify or use your property however you want.

Title Professional

• Who is it? A title insurance professional researches and examines public records, making sure that there are no defects or problems with your property that could lead to legal issues. They can also oversee and manage the closing process.
• Why do they matter? A title professional makes sure that the title search is completed, creates the title insurance policy, and takes steps to ensure that you will not have any future ownership issues.
• How do I benefit? A title professional gives you peace of mind. They sweat the small stuff so you can focus on settling into your new property.

Title Search

• What is it? A title search uncovers any issues that could limit or jeopardize your rights to the property. It takes place early in the house buying process.
• Why does it matter? If any title issues are found during the title search, your title professional will take care of them, sometimes without you even knowing. Once any issues are resolved, you will be able to get owner’s title insurance.
• How do I benefit? Running a title search on your property safeguards you from unknowingly inheriting any legal obligations, debts, or other issues from the previous owner.

Title Insurance

• What is it? Title insurance comes in two forms:
  • The owner’s policy is purchased by the homebuyer. It is not required, an owner’s title insurance policy is the best way to be sure your property rights are protected.
  • The loan policy is usually required by the lender and paid for by the homeowner or seller. A loan title insurance policy only protects the lender’s interest.
• Why does it matter? There are situations where issues arise after a title search that could not have been discovered beforehand, such as fraud, forgery, or clerical errors. If you have an owner’s title insurance policy, you are protected from losing your property due to one of these unforeseen issues.
• How do I benefit? Owner’s title insurance is the best way to protect your interests once you have purchased the largest investment of your life: your home. A vast majority of American homebuyers purchase owner’s title insurance to protect themselves from title issues.

Closing

• What is it? Closing is the last step in the home buying process, where your home becomes officially yours.
• Why does it matter? Closing is the process that allows the transfer of the property’s ownership to take place.
• How do I benefit? Once the closing process is complete, you get the keys to your home!

For more information about owner’s title insurance, contact Two Rivers Title Company today.