9 Things Homebuyers Need To Know About Title Insurance

In your journey to buy a home, you’ll learn a great deal about real estate, property values, home repair, financing and a variety of other topics. Title Insurance is one of those items, so here are 9 things you need to know:

  1. Titles exist to prove legal ownership of property, such as a house, condo or vehicle.
  2. The title of your new home needs to be transferred to you upon purchase.
  3. Property ownership can only be transferred from seller to borrower with a clean and clear title, meaning no other person or entity can claim ownership.
  4. A clear title means that it is free from judgments, liens and bankruptcies.
  5. Nearly 1/3 of title searches turn up some irregularity. Even if it’s a small issue, it must be resolved.
  6. Title insurance provides financial protection against things like fraud, forgery, spousal claims, undisclosed heirs and tax issues.
  7. One type of title insurance is necessary to protect your interests. The other type is to protect the lender. Both are required.
  8. You have the right to choose your title insurance provider.
  9. Generally, the buyer pays for one policy while the seller assumes the cost for the other.

This quick list outlines the most common scenarios, but title insurance varies based on where you live and several other factors. Ask your Stearns Mortgage Loan Originator for details about your individual title insurance needs.

This blog post is being provided for the purpose of general education, but should not be construed as legal or financial advice.
- By Lauren Howey, May 17, 2017