Title Insurance:
What is it and Why do you need it?
Fire insurance protects you against losses from fire. Collision
insurance guards you against the cost of a damaged car. Theft insurance – well
you get the idea.
Title Insurance protects your title to real estate that you are
about to acquire. To understand why title protection is essential;
we need to consider real estate for a moment.
Your
Ownership of Real Estate
Many special laws have been enacted to protect ownership of land
and the buildings, which stand on the land. You should realize
whenever you buy property that the owner who is selling it to
you has extremely strong rights as do his family and heirs. Also,
there may be others in addition to the owner, who have "rights" in
the property you are going to buy, perhaps governmental bodies
or contractors, for example. Some of the things a title search
uncovers are any unpaid taxes or mortgages, judgments against
previous owners, easements and much other court actions or recorded
documents, which can affect title to real estate. We find and
report such defects in the title to the real estate you wish
to buy, so that these matters can be corrected and cleared up.
It is the first benefit you receive when title insurance is ordered.
Protecting
You Against Hidden Risks
Protection against loss from claims on real estate, which cannot
be discovered by examination of the public records, is the second
part of the twofold benefit, which we provide. For example, the
home that you just purchased could be threatened or lost by such
circumstances as forgery, confusion due to similar names or error
in the records. These contingencies will be covered in your policy
of title insurance.
How does a Title Insurance Policy protect against these damages?
If a claim is made against your title as covered by your policy,
we protect you by:
1. Defending your title, in court, if necessary at our expense.
2. Bearing the cost of settling the claim if it proves valid, in
order to perfect your title and keep you in possession of the property.
You
Only Pay Once for Owners Title Insurance
Unlike other forms of insurance, the original premium is your only
cost as long as you own the property. There are no annual payments
to keep your Owners Title Insurance policy in force.
Lenders
Policies
When you apply for a mortgage to purchase real estate or refinance
your present mortgage, the lender must also be insured. Therefore,
when you purchase real estate, you will receive an Owners policy
and the mortgage company will receive a Loan policy. When you
refinance, your owner’s policy remains in effect, but once
the loan is paid off the old Loan policy becomes void. At this
time, the new mortgage company will require a Loan policy to
cover the new loan. You will have to purchase this policy and
have to go to a settlement again. The good news is that you may
qualify for a discounted title insurance rate. Please call Jan
Sapp at 850.547.2025 or email jan@professionaltitlefl.com for
a quote.
