Title Insurance Port St Lucie
While homeowners insurance designed to protect the structural damage to a home, the title insurance is to protect the ownership of that home. Title insurance is divided to two different policies protecting the interest of different people. The owner’s policy protects the homeowner against title defects and lender policy protect the mortgage holders investment on that property. Although the financial institutions are the beneficiaries of the lenders insurance, but the home buyers pay the premium.
Title Insurance is one of the lender’s required documents, which is not mandatory in cash sales of properties. However, it is wise to have title insurance on these types of transactions because the concept of properties which have changed many hands before should not have any title issues have been proven wrong. The cost of the title insurance in comparison to the total price of a home is a minimal cost that it is not worth the risks of not having title insurance.
The role of a title insurance is to protect the current owners from hidden issues which may threaten the ownership of a property. Some of these hidden hazards could include:
- Clerical Errors
- Deed issues, such as transfer of the deed through forgery
- Spousal or unknown heirs claims on the property
- Unknown liens or fraudulent activities effecting the deed
- Transfer of deed through an expired or fraudulent power of attorney
There are restrictions and covenants revealed in your Title Binder or Commitment package that you may not have known when you made your offer. Though you may have read disclosure documents or even a copy of subdivision or condominium covenants, it is possible that some of the rules and regulations and other covenants have been changed since its initial print. The only way you would find out is to read the copy of the documents in the title insurance binder, which will include the latest and most current copy of documents as they were recorded at the courthouse. You may also find some recent filings related to obligations of the homeowner association indicating their financial standing and future plans, which could result in expensive assessments in the future.
There are two sections at the front of the title insurance binder (or commitment) that summarize what’s included and can give you a quick overview to guide you to the most important items first, or those of most concern. These two sections are the “Requirements,” and the “Exceptions.” Requirements are things the title company says must be done or criteria met before their binder is good and title insurance will be issued. Generally, these are pretty cut-and-dried, such as the seller paying off any mortgages or liens against the property, paying current taxes due, etc.
The “Exceptions” are fairly standard set of exclusions that the insurer would not cover. Some of these exclusions many include:
- Easements or any claim for easements not recorded previously
- Any disputes regarding the encroachments and boundary lines of the property
- Mineral or water rights
- Taxes or special assessments not shown in public records
- Mechanic’s Lien not recorded at the time the insurance policy was issues
You’re the customer, and it is your money and investment, so don’t be shy about asking questions about the documents, requirements and exceptions in the title insurance. There are deadlines for objections you may have that could result in default, so don’t hesitate to to examine all documents and the attachments.