Buying a home should be fun, not something that adds stress, that’s why choosing a title insurance company with reliable agents is important. From last minute prior ownership claims, judgments and liens to fraud, not having a policy or a dependable agency can result in unexpected fees, delays and stress that you don’t need. That is where we come in.
Not only will you have an agent that explains things without legal jargon, but we check for everything mentioned above and also have a paperless system to speed up the process while being eco-friendly. If you want an agency that treats you like a person, has agents that do thorough research and communicate quickly to help you close, then we’re ready to support you. Call us today at 703.934.2100 or use the form below and we’ll help get your contract to closing so you can focus on the important things in life with no additional stress.
Questions and Answers About Title Insurance
Just like any type of protective policy, there’s a lot of confusing legal terms that get thrown around and questions that don’t seem to get answered in non-lawyer terms. Below you’ll find the answers to the most common questions we get asked without all of the confusing language.
What is Title Insurance?
It is the protective umbrella that shields you and your property from prior owner issues that could come up after you purchase. Information could have been missed, overlooked, mis-indexed, improperly recorded, and so on, and title insurance covers you for any financial loss that could accrue.
Why Do You Need Title Insurance?
By having a policy, you can help prevent or avoid typical defects such as a mistake in a prior deed, a hidden lien, outstanding ownership claim or even outright fraud that can result in losses for you as the owner and/or your lender.
How Does it Protect Me?
It protects you against loss due to an unknown title or past claim issues that arise after you purchase or refinance a property. Having this can help provide indemnifications against those losses when owners and lenders suffer losses related to a covered risk.
What Happens if an Issue Comes up After Closing?
If an issue arises after closing, a title claim can be submitted with the Underwriting Company listed on your Owner’s Title Policy. The Underwriter will get with the Title Company and review all the documentation to come to a unified conclusion. Without an Owner’s Policy, the Underwriter would not be able to assist or intervene.
How Much Does Title Insurance Cost?
The cost is roughly around $1000 but it is based off the purchase price. The price can go up or down depending on where you live, the provider you choose and the property value.
What is the Process for Getting It?
The step by step process is below:
- A contract or title request is sent in
- The title company is required to research the property’s chain of title or ownership history
- The title company reviews land records and clears any clouds on title
- A Closing is scheduled and occurs
- A Policy is issued at closing table
What are Common Examples of Title Claims?
There are numerous that can arise. The most common ones are unknown or missing heirs, unreleased prior mortgages, or liens placed on the property when a homeowner failed to pay a contractor or homeowner’s association.
If a claim appears, it must be remedied before you as the homeowner are able to sell title (your ownership of the property) and collect payment.
What Makes it Different From Other Types of Insurance?
While most types cover things that happen in the future, these policies cover things that happened in the past and help to provide protection for unknown title defects such as fraud, prior deeds, liens, or ownership claims by other parties.
Is Title Insurance Required by Law?
Yes, but only because your mortgage lender will legally require you to purchase a lender’s policy as a stipulation of the loan to protect the bank’s money in the event a title claim arises down the road.
Does a Title Search or Abstract Ensure Clean Title?
Not always. A Title Search is a search of the property up to 60 years back, and it will pull as much information from the county records as possible. Sometimes certain documents are not recorded or mis-indexed with the county, so non-filed issues could arise that a Title Search may miss.
What is the Difference Between an Owner’s and Lender’s policy?
Owner’s title insurance is optional, and it covers the homebuyer’s down payment, along with the home loan amount and any legal expenses incurred to defend title.
A lender’s policy does nothing to indemnify the home owner in the event of a title claim, which is why nearly all consumers opt to purchase both lender’s and owner’s title insurance at the closing table.
Should I Buy an Enhanced Policy?
Paying extra for an enhanced policy is not always necessary and it generally runs about 20 percent more than the Standard, or Limited, title insurance policy but it covers a variety of title claims or defects. The most common scenario when a homebuyer should strongly consider an enhanced title insurance policy over a standard title insurance policy is in the case of new home construction.
Note: Always speak with your title attorney or closing agent to determine what is the best path forward for your unique real estate transaction.