Title Insurance ........... Part I

By
Mortgage and Lending with George Souto NMLS #65149 FHA, CHFA, VA Mortgages NMLS #65149

It is not usual for Borrowers to confuse Title Insurance with Homeowners Insurance, but they are two completely different things.  One protects the homeowner against fire, theft, and liability, while the other protects the Lender. However, Title Insurance can also be obtained to protect the Homeowner as well, and we will look at that coverage in a later blog, but the initial Basic Title Insurance Policy or Lenders Title as it is often referred to, protects the Lender against title claims against the property such as liens.

Title insurance protects a Lender against loss from something that has already happened, like a fake deed somewhere in the chain of title.  For example someone could come along claiming that a past relative owned the house, and as an heir of that relative they now own the property. 

Even though Lenders Title Insurance mainly protects the Lender, it is usually paid in a one time lump sum fee at the Closing by the Homeowner.  The policy then remains in force until the property is sold, or the Homeowner refinances.  Mortgage lenders normally require that borrowers obtain title insurance to protect the Lender's interest in the property.  The Homeowner may also purchase an owner’s policy to protect their interest in the property.

Next blog will cover the Owner's Title Policy.

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Who To Call For Your Mortgage Needs In Connecticut:

George Souto NMLS# 65149 is a Loan Officer who can assist you with all your FHA, CHFA, and Conventional mortgage needs in Connecticut. George resides in Middlesex County which includes Middletown, Middlefield, Durham, Cromwell, Portland, Higganum, Haddam, East Haddam, Chester, Deep River, and Essex. George can be contacted at (860) 573-1308  gsouto@mccuemortgage.com, or visit my McCue Mortgage Homepage.

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 Info about the author:

George Souto NMLS# 65149 is a Loan Originator who is licensed in #CT, #RI, #MA, #NH, & #FL and can assist you with all your #FHA, #Conventional, #VA, #USDA, and #State Bonded Progam #mortgage needs in #CT, #RI, #MA, #NH, & #FL. George resides in Middlesex County which includes #Middletown, #Old Saybrook, #Middlefield, #Durham, #Cromwell, #Portland, #Higganum, #Haddam, #East Haddam, #Moodus, #Chester, #Deep River, and #Essex. George can be contacted at (860) 573-1308 or souto@snet.net

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Re-Blogged 1 time:

Re-Blogged By Re-Blogged At
  1. Barbara Altieri 11/29/2011 01:43 AM
Topic:
Mortgage / Finance
Location:
Connecticut
Groups:
Realtors®
Mortgages
1st Time Buyers
Real Estate Rookie
Tags:
title insurance

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Rainmaker
1,317,601
Joan Whitebook
BHG The Masiello Group - Nashua, NH
Consumer Focused Real Estate Services

It is very important for buyers to understand the difference between homeowner's insurance and title insurance.  I always recommend that buyer not only purchase borrower's title insurance, but the extended insurance as it covers many more things that could effect title.  I'm looking forward to your future posts.

Nov 25, 2011 01:57 PM #1
Rainmaker
658,326
Kathy Toth
Ann Arbor Market Center Keller Williams - Ann Arbor, MI
Ann Arbor Real Estate Experts - Kathy Toth Team

That always seems confusing to 1st-time home buyers, Title vs. Homeowners Insurance.  When a buyers makes a purchase on a Land Contract - run a title search.  And remind them that when they get ready to pay off the Land Contract they do another title search.  Just good practice.

Nov 25, 2011 02:09 PM #2
Ambassador
4,301,228
Praful Thakkar
LAER Realty Partners - Andover, MA
Andover, MA: Andover Luxury Homes For Sale

George, good post about title insurance. I may add part of your post into my presentation for my buyer's consultation.

Nov 25, 2011 03:09 PM #3
Ambassador
1,654,047
Jennifer Fivelsdal
JFIVE Home Realty LLC | 845-758-6842|162 Deer Run Rd Red Hook NY 12571 - Rhinebeck, NY
Mid Hudson Valley real estate connection

George this is an important topic; some buyers think the the title insurance they are paying for is to protect them and not the lender.  Buyers should purchase insurance to protect their interest too, I have heard of occassions where this paid off.

Nov 25, 2011 03:59 PM #4
Rainer
422,958
Peggy Chirico
Prudential CT Realty - Manchester, CT
REALTOR® 860-748-8900, Hartford & Tolland County Real Estate

Hi George - Very clear explanation of title insurance.  It's important that owners protect their interest too!

Nov 26, 2011 01:53 AM #5
Rainmaker
2,282,467
Joe Petrowsky
Mortgage Consultant, Right Trac Financial Group, Inc. NMLS # 2709 - Manchester, CT
Your Mortgage Consultant for Life

Great explanation about a topic that can be confusing for most individuals, either buying a home or refinancing.

Nov 26, 2011 03:35 AM #6
Rainmaker
880,355
Debbie Walsh
Shahar Management - Middletown, NY
Hudson Valley NY Real Estate 845.283-3036

George great explanation - buyers don't always have a clear understanding of these things before closing.

Nov 26, 2011 04:08 AM #7
Rainmaker
1,325,251
Nick T Pappas
Assoc. Broker/Broker ABR, CRS, SFR, e-Pro, @Homes Realty Group, @HomesBirmingham & Providence Property Mgmnt, LLC Hun... - Huntsville, AL
Madison & Huntsville Alabama Real Estate Resource

George, title insurance is usually split between the buyers and sellers.  Depending on the negotiations the buyer can ask the seller to pay all, but whatever the outcome, title insurance is very important.

Nov 26, 2011 06:02 AM #8
Rainmaker
592,907
William J. Archambault, Jr.
The Real Estate Investment Institute - Houston, TX

George,

The difference between "Home owners and Title Insurance can't be stressed enough!

Bill

Nov 27, 2011 03:19 PM #9
Ambassador
2,300,879
1~Judi Barrett
Integrity Real Estate Services 118 SE AVE N, Idabel, OK 74745 - Idabel, OK
BS Ed, Integrity Real Estate Services -IDABEL OK

George, First time home buyers especially appreciate simple explanations of the costs and fees associated with purchasing a home.  This blog makes it plainly simple to them the difference between A homeowners property insurance and title insurance.    Many of our local lenders in Oklahoma do not require title insurance since we are an abstracting state and a Title Opinion is required on the abstract before a title policy can be issued.  Often they are content with the TO as their assurance that there is a good and marketable title.  

Nov 30, 2011 11:01 PM #10
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