Insurance is designed to protect you and your possessions from damages and claims. You are already familiar with other forms of insurance such as car, health, and home, but have you remembered title insurance?
Title insurance is a type of insurance that protects and covers both lenders and homeowners in the case of loss on a property due to legal defects.
Protects The Lender’s Interest In The PropertyYour lender will have as much interest in your property that you do. Should you default on the loan, title insurance protects the lender by ensuring they get back their principal and interest, and be able to foreclose on the home.
Be it from an ex-spouse, previous liens or encumbrances, or errors in real estate documents, title insurance protects you, the homeowner from claims and covers the amount of the purchase price.
When or if you decide to sell your home, title insurance will help you sell. For one, it will help a buyer know that your property is free and clear, with a good title. It will also show them that no one else has claims on the home.
When you purchase your home, you will be required to get title insurance and have it for as long as you are paying off the loan. When you close on your new home, you will pay a one-time fee to the insurance company so they may do an extensive search of records on the property for any claims or losses. They will also check to make sure that the seller actually has the right to sell the home.
While you will need title insurance, you have the right to choose the title company that is best for you. Choosing your own allows you to pick a company that you trust and works with your budget. Getting title insurance through a company that the seller recommends and is included in the closing costs can be expensive.
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