When buying a home, you should consider purchasing title insurance. Real Estate Title Insurance insures against potential title issues which arose before you purchased the property, such as:
- Mistakes in recording of legal documents;
- Forged deeds, releases, or wills
- Undisclosed or missing heirs
- Deeds by persons of unsound mind
- Deeds by minors
- Deeds executed under invalid or expired Power of Attorney
- Liens for unpaid taxes
Loan Policy of Title Insurance
If you are financing the purchase of your home, the Lender will require that you purchase a Loan Policy of Title Insurance which protects the Lender’s interest only in the property.
Owner’s Policy of Title Insurance
An Owner’s Policy of Title Insurance would provide protection to you, the property owner, should a covered title problem arise. It would provide protection to you against losses arising out of the title issues discussed above including claims by contractors who say they were not paid for work done on the property before you purchased it.
There is a one-time fee paid at closing that lasts for as long as you own the property, and can be issued at the same time as the loan policy.
Title policies are issued after a complete and thorough title search. The Lender’s attorney will perform a title search at the appropriate registry of deeds to determine if there are any outstanding title issues of record. If the title search reveals any title issues, the seller customarily resolves the title issue before the closing. A title search does not reveal the type of title issues listed above which is why it is a good idea to have an Owner’s Policy of Title Insurance.
Purchasing Title Insurance
You usually purchase real estate title insurance through the Lender’s attorney who is also an agent of the title insurance company and authorized to prepare loan and owner’s title insurance policies.
Title Insurance Fees
The standard Loan Policy base rate is $2.50 per $1,000 of the loan amount. If you wish to purchase simultaneous Owner’s and Lender’s policies, the policy rate for an Owner’s Policy is $4.00 per $1,000 of the purchase price, plus $175.00 for any amount of loan coverage not in excess of owner’s coverage.
Call Now For A Free Consultation
If you are buying or selling a home, contact Attorney Bob Allison for a free telephone consultation at 978-740-9433.