Why you need to go for title insurance
As a property investor, you may think you can forgo several services a home buyer may need when purchasing a property, say for example real estate title insurance. In many of the cases, this may be true, but real estate title insurance can be invaluable, even for investors, and should be something considered every time a transaction is made.
We help you gain a better understanding of what a real estate title insurance policy can offer you, when it’s a good idea to buy an insurance policy, and how much you can expect to see for a its insurance premium.
Title insurance is a kind of insurance that covers missed info by the title agent related to the title search of the geographical area being purchased, also referred as a title defect. It is totally different from most insurance policies like car insurance or homeowners insurance in that real estate title insurance covers things that occurred in the past, and not the future, and is acquired for a one-time fee from the policy holder.
There comes title insurance for both, I.e. lender’s title insurance and owner’s title insurance. An Title Insurance Attorney Weston can help understanding differences between the two of them. However, both of these can be purchased during settlement of any real estate transaction and is settled with the help of an escrow. In many of the cases, the mortgage lender will require the homeowner to buy the lender’s title insurance, and it’s typically encompassed in the closing costs of a conventional mortgage loan. It’s all-important to keep in mind that the lender’s title insurance offers zero coverage to the buyer.
By acquiring title insurance for a real estate, if a legitimate title claim is put forward after the closing, your mortgage lender won’t be held accountable, and the title insurer will take care of any payouts or conflicts on your behalf, depending on your coverage under policy. Although it’s an additive out-of-pocket expense, it’s a one-time fee and covers you for the length of your possession, be it 6 months or 50 years. A title insurance policy can vary just like any other form of insurance, so make sure to read the title policy intimately. Consult our Title Insurance Attorney Weston to understand the severity of policy purchased.
An owner’s title policy will shield all financial losses associated with everything from an ownership dispute to fines discovered after closing of the deal. Since there’s no other recourse if something arises, without a home owner’s policy, you would be on the hook for any costs related to with the claim.
