Title insurance is one of the few types of protection policies available to homebuyers and one that is often overlooked because of its optional nature.
Because title insurance is purchased simultaneously with the home, it can be very easy to forego when looked at alongside all the additional fees that are associated with purchasing property.
This is typicaly not advisable, as title insurance is one of the smartest forms of protection a homeowner can buy. Here are just three reasons why every purchaser should get title insurance.
It’s The Best Protection Against Fraud
Title insurance protects the owner of a home from any claim made against their property, whether or not they are responsible. These include unpaid mortgage balances on the home, an improper foreclosure or any form of real estate fraud perpetrated by the seller.
Fraud is more prevalent now than ever before and has started to gain momentum in real estate as well. Forgeries are easier to create in the electronic age and criminals take advantage of today’s ‘do-it-yourself’ attitude to sell property they don’t actually own to unsuspecting victims.
The Insurer Performs An Exhaustive Title Search
Countless records are now made public online for low one-time payments to access them. But does anybody really know what they should be looking for? Title insurers are experts at finding anything suspicious with a home and researching exhaustively to make sure everything about the transaction is legitimate.
And if it’s not, the insurance still covers the buyer for any losses incurred if they are ordered out of their new home should a claim be made against it. Then they will research the claim to make sure it isn’t a fraudulent one.
Title Insurance Is A One-Time Fee
Although it is a large fee, title insurance only needs to be paid for once. Unlike other insurance policies that are either monthly or annually, title insurance is a one-time fee that is acquired at the time of closing. Most mortgage lenders require that their title insurance policy is paid for by the borrower anyway, so it’s not a giant leap to take out your own policy the same time.
Title insurance will also protect against mortgage fraud or any unpaid mortgages the home already has. Although title insurance is strongly recommended, it is a good idea to speak with a professional about it so that any questions you have may be answered.
When you are going through the process of looking for a new home, you are probably focused on the sticker price of that home. Even though it is important to think about your down payment, your monthly mortgage payment, and the total amount of the loan, there are other expenses that you might need to cover as well. If you do not put down enough money, there is a chance that the lender could ask you to pay for something called private mortgage insurance. What is private mortgage insurance and how much do you have to pay? There are several important points that you should keep in mind.
Many homeowners do not realize that the risk of a flood is a significant factor that plays a role in not only homeownership but also the closing process. Even though flooding is a major risk, many homeowners do not carry enough coverage. Without proper flood insurance, homeowners risk losing millions of dollars. Therefore, it is prudent for those who are looking for a home to factor flood insurance into their home search. This can streamline the closing process down the road.