The History Of Title Insurance

title insurance

Title insurance hasn’t always been a requirement in real estate transactions.

Not so very long ago, property in the United States was bought and sold without title insurance. Of course, as you can imagine, the real estate transactions were much riskier than they are now. With inconsistent record-keeping, problems were bound to arise. In fact, it was possible to lose your entire property investment should significant title defects come to light. Therefore, something had to change. Enter, title insurance.

Property Transactions Before Title Insurance

From the colonial days until nearly the American Centennial, real property would be bought and sold without any protection or guarantee. At that time, buyers of land were merely trying to purchase property without any title rights, interests or liens. However, this was far from guaranteed.

Expansion Of Property Transfers

While transactions at this time were still complicated and risky, conveyancers were there to be the local real estate expert. While they were not lawyers, they knew real estate law inside and out. Although much of the land in America at the time wasn’t for sale, this practice worked with such a small volume of transactions. However, as the years went on, an increase in purchases began to occur.

The End Of The Conveyancer And The Beginning Of Title Insurance

The risky business of conveyancers led to its eventual demise. In 1858, a man named Mr. Watson attempted to buy a parcel of land in Pennsylvania. Mr. Watson subsequently hired a Mr. Muirhead to act as his conveyancer. Muirhead discovered recorded judgments on the property and disregarded these explicit title defects. However, Mr. Watson completed the sale. Soon after, he was hit with a slew of liens and ultimately sued Mr. Muirhead. This led to the case Watson v. Muirhead which establishes title insurance as a necessary instrument needed in any real estate transaction.

The Push For A Standard Uniform Title Insurance Policy

The American Land Title Association (ALTA), the primary trade association for title insurance, was first formed in 1907. It was then that title insurance became widely available throughout the entire country.

A Title Company You Can Trust: Colony Title

At Colony Title, we will help you through the process of getting your property’s title and help you avoid the pitfalls of hidden costs while you buy and sell your home. We are also well trained in identifying any and all errors in public records and helping you resolve them. We specialize in real estate title insurance in both Maryland and Washington, D.C., and we will perform an expert title search, check through all past documentation, and examine records for any fraud or forgery. For more information on how we can get you into the home of your dreams, contact us online or give us a call at (410) 884-1160. To get more updates on housing markets and how to get into your home, follow us on Facebook, Twitter, LinkedIn, and Google+.


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