4 Things Your Customers Should Know About Title Insurance
Below is some helpful basic information about title insurance. I always counsel buyers to research the matter - if they are getting a loan, then the lender will require it and the further endorsement to add owners coverage is not much more. The question comes up more often for cash buyers - is it worth it.
Its primarily about peace of mind - title claims are fairly rare, but when it involves whether or not you really own your home, its a big deal!
4 Things Your Customers Should Know About Title Insurance
At some point as a real estate professional, you’ve likely been asked by sellers or buyers: “What exactly is title insurance?”
For some sellers and buyers, title insurance is a new concept and, because it is considerably different in scope and process from other types of insurance, requires explanation. Here are five important facts to share with your clients when you’re asked about title insurance:
1. Title Insurance helps protect your ownership rights to your property.
Through the search and examination process, defects, liens, and encumbrances in the chain of title can be detected that could adversely affect your ownership interests in the property. A title insurance policy protects the homebuyer from the day of closing into the past. This covers all owners before them.
2. There are two types of title insurance involved in a home purchase.
If the buyer is securing a mortgage for the purchase, the lender will require a title insurance policy designed to protect only the lender’s interest in the property. This is called a loan policy. The seller or buyer (depending on the contract terms) would also purchase an owner’s title policy, which protects the buyers (new owner) interest in the property for as long as they own it.
3. You only pay for an owner’s title insurance policy once.
Typically paid at closing, an owner’s title insurance premium is a one-time fee. The coverage included in the policy, however, lasts as long as the insured parties (or their heirs) hold an interest in the property. Unlike a loan policy that is no longer in effect once the loan is paid off or refinanced. If the property is refinanced in the future, the lender (even the same lender that held the previous loan) will require a new loan policy to protect their interests in the new loan.
4. You have the right to select the title company.
The Real Estate Settlement Procedures Act (RESPA) protects buyers and sellers rights to select providers of various settlement services. This includes title insurance companies. Consumers should know they are free to work with the title company that they are most comfortable.
Title Junction is a full service real estate title company serving the area of Fort Myers, Cape Coral and the entire state of Florida since 2005. The company handles a number of real estate title services for both commercial and residential properties. Employees of Title Junction can also act as a witness in courtesy closings as well as an escrow agent or a notary public.
Please contact Jennifer Ferri of Title Junction, LLC for further information @ 239-415-6574 or www.title-junction.com.
Jennifer Ferri
Owner and Operator
Title Junction LLC
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