First Title What is Title Insurance Image

Owner's Title Insurance... What It Is:

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:

Real Estate has always been considered our most valuable possession. It is so basic a form of wealth that 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 many other court actions or recorded documents that 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 that cannot be discovered by examination of the public records is the second part of the twofold benefit which the Title Insurance provides.

For example, the title to the home which you have paid for - and to which you have received a deed - could be threatened or lost by such circumstances as a 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 Dangers?

If a claim is made against your title as covered by your policy, the title protects you by:

  • Defending your title, in court if necessary, at our expense.

  • Bearing the cost of settling the claim if it proves valid, in order to perfect your title and keep you in possession of your property.

Summarizing, Title Insurance Means This to You:

It is assurance that every possible cloud on the title to the land you are buying - which can be discovered from the public records - has been called to your attention so that such defects can be corrected before you buy. And - It is insurance that, if any undisclosed claim covered by your policy arises out of the past to threaten your ownership of real estate, it will be disposed of, or you will be reimbursed, exactly as your title insurance policy provides.


10 Common Title Problems

1. Errors In Public Records

To err is human, but when it affects your homeownership rights, those mistakes can be devastating. Clerical or filing errors could affect the deed or survey of your property and cause undo financial strain in order to resolve them.

2. Unknown Liens

Prior owners of your property may not have been meticulous bookkeepers — or bill payers. And even though the former debt is not your own, banks or other financing companies can place liens on your property for unpaid debts even after you have closed on the sale. This is an especially worrisome issue with distressed properties.

3. Illegal Deeds

While the chain of title on your property may appear perfectly sound, it's possible that a prior deed was made by an undocumented immigrant, a minor, a person of unsound mind, or one who is reported single but in actuality married. These instances may affect the enforceability of prior deeds, affecting prior (and possibly present) ownership.

4. Missing Heirs

When a person dies, the ownership of his home may fall to his heirs, or those namedwithin his will. However, those heirs are sometimes missing or unknown at the time of death. Other times, family members may contest the will for their own property rights. These scenarios — which can happen long after you have purchased the property — could affect your rights to the property.

5. Forgeries

Unfortunately, we don't live in a completely honest world. Sometimes forged or fabricated documents that affect property ownership are filed within public records, obscuring the rightful ownership of the property. Once these forgeries come to light, your rights to your home may be in jeopardy.

6. Undiscovered Encumbrances

When it comes to owning a home, three can be a crowd. At the time of purchase, you may not know that a third party holds a claim to all or part of your property — due to a former mortgage or lien, or non-financial claims, like restrictions or covenants limiting the use of your property.

7. Unknown Easements

You may own your new home and its surrounding land, but an unknown easement may prohibit you from using it as you'd like, or could allow government agencies, businesses, or other parties to access all or portions of your property. While usually non-financial issues, easements can still affect your right to enjoy your property.

8. Boundary/Survey Disputes

You may have seen several surveys of your property prior to purchasing, however, other surveys may exist that show differing boundaries. Therefore, a neighbor or other party may be able to claim ownership to a portion of your property.

9. Undiscovered Will

When a property owner dies with no apparent will or heir, the state may sell his or her assets, including the home. When you purchase such a home, you assume your rights as owner. However, even years later, the deceased owner's will may come to light and your rights to the property may be seriously jeopardized.

10. False Impersonation of Previous Owner

Common and similar names can make it possible to falsely "impersonate" a property owner. If you purchase a home that was once sold by a false owner, you can risk losing your legal claim to the property.


Play It Safe

These and other issues are often covered by an owner's policy of title insurance. When you buy a home, make sure you're protecting that investment with title insurance.