Importance Of Holding a Title Deed Insurance
Title deed insurance is a policy that covers third-party claims on a property that don’t show up in the initial title search and arise after a real estate closing.
A third party is someone other than the property’s owner, such as a construction company that didn’t get paid for its work on the home under a previous owner.
A title deed insurance policy covers underlying issues with a property’s title that you might have missed before you bought the home.
An owner’s title insurance policy can cover the costs of paying off a previously undiscovered lien, which is a legal right or claim on someone’s property or assets until they pay a debt or fulfill an obligation.
The person claiming the property is the one referred to as a lien) or defending against a lawsuit filed against you by someone claiming a right to the property.
It can also provide a cash settlement to a new owner who unwittingly purchases a property with a forged deed from a fraudulent seller who does not actually own the home.
Furthermore, owner’s title insurance protects your ability to sell the home one day if a problem turns up during a later title search.
Below are other things that an owner’s title policy can safeguard you from:
Property survey errors
These are mistakes made when measuring or mapping the boundaries, location, or features of a piece of land. They can cause legal, financial, or practical problems for property owners or buyers.
Boundary disputes
These are disagreements over the location or demarcation of a border between two or more countries, states, or other political or geographic entities.
Errors on the property deed
This is a mistake in the legal description of the property that can affect the chain of title.
Others include:
Building code violations by a previous owner
Conflicting wills
Claims by an ex-spouse who didn’t sign off on the sale
Forged documents
Liens from contractors, taxing entities, or previous lenders
Encroachments
Improperly recorded documents
