Your Guide to Title Insurance

When you are purchasing a home, especially if you are a first-time homebuyer, it’s easy to become overwhelmed by all the things you must think about.  Something like title insurance is probably not even on your radar. It’s a fee that will appear on your closing document and chances are you don’t even know what it’s for.  If that’s the case, we’ve got you covered. 

Here are five things you need to know about title insurance:

  • Like other insurance policies, title insurance is something that protects you financially should there be a loss. In this case it protects you with regard to property ownership. It not only ensures that the property you are purchasing will be legally transferred to you from the previous owner, it also protects you from possible future title defects. There isn’t a monthly premium with title insurance; it is a one-time fee paid at closing. This one-time payment will protect the insured from title defects for the life of the loan. Defective Title
  • Title insurance is important because while a title research company will investigate the history of ownership of the home to be sure there are no title defects, there is always a possibility that an issue could arise later due to several reasons such as improperly recorded documents, mistakes in ownership history or other legal matters that occurred prior to your purchase of the home.
  • There are two types of title insurance; one that protects the homeowner and one that protects the mortgage lender. Your lender will require that you purchase the lender’s policy to protect them from any loss should a problem arise. The owner policy protects you and will cover legal fees or other losses that occur due to a title defect. You are not required to get an owner policy, but it’s well worth it to have it in place just in case something goes wrong in the future.
  • It can be frustrating to pay for insurance that you might never use, but it is risky to not have it in place. Think of it as paying for peace of mind.  With title insurance, you will be protected from catastrophic circumstances should a title defect be found. You could not only lose a lot of money; you may even lose your home.
  • Title insurance is purchased when closing on your home. You have the option of buying it from whatever company you choose, but if your lender has a preferred company, you may find it less expensive to add your owner’s policy onto your lender’s policy. Cost of Title Insurance

If you’re thinking about buying or selling a home in the New River Valley area, contact professional, experienced Realtor Desi Sowers and let her assist you with all your real estate needs. Give her a call today at 540-320-1328!

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