Last Train to Clarksville

Should YOU Get It?

If you have a contract on your future home or you are in the process of closing, one thing you will be asked at closing by the attorney is, “Do you want to purchase a Title Policy?”

Most Realtors tell their client that at closing they will be asked this question and will be given the option to purchase at closing with a great rate or wait and possibly pay more later.

So what would you be paying for and what does it mean to you?

What is Title Insurance?

Title Insurance is different from other types of insurance in that it protects you, the insured, from a loss that may occur from matters or faults from the past.  Other types of insurance such as auto, life, or health cover you against losses that may occur in the future.  Title insurance does not protect against any future faults. Another difference is that you pay a one-time premium.  A title insurance policy will protect you from risks or undiscoverable interests.

What is a lender’s policy?

A lender’s policy protects the mortgage holder.  If there is a fault in title that results in a loss, the mortgage holder will be paid back.

What is an owner’s policy?

An owner’s policy protects you, the purchaser, against a loss that may occur from a fault in your ownership or interest you have in the property.  You should protect the equity in your new home with a title policy.

What does an owner’s policy provide?

• Protection from financial loss due to demands that may be charged against the title to your home, up to the cost of the title policy.
• Payment of legal costs if the title insurer has to defend your title against a covered claim.
• Payment of successful claims against the title to your home covered by the policy, up to the cost of the policy.

What “hidden risks” are protected under a title policy?

How do I obtain title insurance and what does it cost?

Let the Title company, Attorney, or agent handling the closing of your property know that you want to purchase an owner’s title insurance policy.

In most states, the insurance commission or some other governmental body controls the premiums for title insurance policies.  You only pay the premium once.  The cost depends upon the purchase price of the property, and usually is less expensive if purchased at closing than waiting a while.

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