Title Insurance
When a property is financed, bought, or sold, a record of that transaction is filed in public records. Likewise, records of other events that may affect the ownership of a property, like liens or levies, are also archived.
In order to purchase a policy of title insurance, a title company searches these records to find – and remedy, if possible – several types of ownership issues. First, the MJH title examiner searches public records to determine the property’s ownership status. After this search, the underwriter will determine the insurability of the title.
For a one-time fee paid at closing, title insurance can protect your property rights for as long as you or your heirs own the property. This purchase protects you from:
- Unpaid mortgages
- Unpaid property taxes
- Fraud
- Undisclosed heirs who could claim the property belongs to him or her
- Undisclosed easements or rights of way that could limit your use of the property
- Judgement Liens
Key Terms
Owner's Policy
Owner’s title insurance protects the buyer from issues that might emerge after the close of the sale. Issues may include human error, unpaid liens, forged documents, undisclosed or missing heirs, or incorrect legal descriptions.
Loan Policy
Lenders require a loan policy when they originate and fund your loan. The loan policy is based on the loan amount. It only protects the lender’s interests in the property should a problem with the title arise. It does not protect the buyer.
Policy Premium
A policy premium is based on the loan amount or purchase price of the property, which is determined by the value of the land plus any improvements. Title insurance industry practices vary due to differences in state laws and local real estate customs.