This BLOG On Title Insurance Frequently Asked Questions By Mortgage Borrowers Was Updated On November 22nd, 2018
Common title insurance frequently asked questions by homeowners are the following:
- What is title insurance
- Importance of title insurance
- What does title insurance do for borrowers of loans
- Coverage from the title insurance policy
- Who benefits from title insurance
In this article, we will discuss and cover Title Insurance Frequently Asked Questions By Mortgage Borrowers.
Purpose For Title Insurance
Title insurance insures properties and its purpose is that the title to the property is free and clear and recorded. Title policy needs to abide by instructions given by lenders with the only exceptions are the line items express on the policy.
Another common Title Insurance Frequently Asked Questions is does the title company insure blemishes on the title that do not appear on public records of the title?
Examples of blemishes not reported on the title are items such as the following:
- forgery interest of missing heirs who have claims to the property
- identification of parties, people who have no right to sell the subject property
- mistakes on title made by previous owners
Other Title Insurance Frequently Asked Questions
Other Title Insurance Frequently Asked Questions is are all blemishes on titles covered?
The normal traditional title owners policy insures defects on the title on public records of the county’s recorder of deeds office where the property and land are at.
The title policy does not cover issues that need to be revealed and disclosed by a professional inspector and/or surveyor.
Things Title Insurance Companies Does Not Insure
Here are subjects that title companies do not normally insure:
- The title company will not insure issues not revealed through public records search such as unrecorded easements
- Unrecorded liens and money due are not covered
- Rights to utility ways that are not recorded are not covered
- Unrecorded private and/or public roads are not covered
- Any other types of encumbrances are not covered
Unrecorded rights and claims by people in possession of the subject property who are not recorded on public records are not covered.
Can Protection Be Obtained On Matters Not Recorded?
Upon application, the company issuing a new title can cover issues that are not revealed nor disclosed by inspection or survey of the subject property.
- Title companies will assess a special extra fee for an intense physical inspection of the property to check on flaws or blemishes on the title that are not recorded
- Title companies call this extended coverage
Types Of Title Insurance Policies
Here are the different types of title insurance policies:
- Homeowners Title Policies are granted to owners of properties
- Home Purchase title policy is granted to home buyers and has an executed real estate purchase contract
Home Loan Title Policies is issued and granted to mortgage lenders.
Title Insurance Frequently Asked Questions On Premiums
The determining factors on premiums of title insurance are by the extent of coverage and the type of coverage that is provided by the title insurance company. The unique thing about title insurance is that there is no monthly or annual payments with title insurance premiums. Title insurance is only paid once on the effective date of title and will remain in the name of the title of the owner for life.
November 23, 2018 - 3 min read