Do I need title insurance?

Even though Klosinski Overstreet scrutinizes every title before closing, there still are risks ranging from identity theft to fraud or probate issues.

That’s why it’s important for buyers to purchase title insurance, which offers the same protection to the title that a homeowner’s policy does to the home. Title insurance is so important that lenders insist on coverage for themselves. That policy, however, does not protect the new owner should the title later be called into question. That’s why it’s a good idea to purchase owner’s title insurance to protect your home.

What is title insurance?

Title insurance protects real estate owners and lenders against any property loss or damage they might experience because of liens, encumbrances or the defects in the title to the property. Each title insurance policy is subject to specific terms, conditions and exclusions.

How does title insurance differ from other insurance?

Insurance such as car, life, health, etc. protects against potential future events and is paid for with monthly or annual premiums. A title policy, obtained by paying a one time premium at the close of escrow, insures against events that occurred in the past of the real property and the people who owned it.

What does it cover?

Title insurance protects against claims from defects. Defects are things such as another person claiming an ownership interest, improperly recorded documents, fraud, forgery, liens, encroachments, easements and other items that are specified in the actual policy.

Who needs it?

Purchasers and lenders need title insurance in order to be insured against various possible title defects. The buyer, seller and lender all benefit from the issuance of title insurance.

How is a title policy created?

After the escrow officer or lender opens the title order, Klosinski Overstreet begins a title search. A Preliminary Report is issued to the lender for review and approval. All closing documents are recorded upon escrow’s instruction. When recording has been confirmed, demands are paid, funds are disbursed, and the actual title policy is created.

What are the policy types?

A standard policy insures the new owner/homebuyer, and a lender’s policy insures the priority of the lender’s security interest.

How much will title insurance cost? Visit Stewart Title Guaranty’s Web site to get an estimate through its online calculator.