How Title Insurance Protects You From the Seller

Sometimes title insurance is thought of as protection for recording errors or unpaid liens that happened long ago and have been obscured by the passage of time. However, there are plenty of current problems with the property and its current owners that can make life difficult for a buyer. A title company can help you avoid unwanted situations with current property owners that could lead to extended court battles and expensive legal fees. Here’s how title insurance protects you from the seller.

How Title Insurance Protects You From the Seller


Though we’d like to think the people we’re doing business with are honorable and upstanding, the reality is that this isn’t always the case. Fraud is a possibility in a real estate transaction, and if you’re on the receiving end, you can face some serious problems once the jig is up. A good example of this can be found here, in a sale of a property after divorce. Normally, this would not be an issue, but if one of the spouses moved to another state and filed for divorce there, there would be no record of the divorce in the state where the property is located. Tenancy records would not change, and the remaining party could conceivably have another party pose as the second rightful tenant in order to sell the property. The buyer, unfortunately would be stuck with a property that was not theirs, and if the estranged spouse returned, he or she would claim entitlement to the property. Title insurance would make this situation considerably less difficult for the buyer, who would have a legal defense prepared by the title company as opposed to having to seek legal counsel and fight the battle on his or her own.

Debts, Loans, and More

If the seller has unpaid debts, outstanding loan judgments, unpaid bills, or other “financial or legal obligations that can’t be satisfied at closing,” you could incur the burden of their creditors as any judgments against the property will pass on to you. Having title insurance ensures that you are protected against these and other scenarios.

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About Colony Title Associates:

Founded in 1995, Colony Title Group handles in excess of 2000 real estate closings in Washington DC and the Delmarva area every year. The founder Tee Tillman has over 23 years experience in the title and real estate law fields. Colony handles closings for several lenders, including banks, credit unions and mortgage brokers. Colony is the preferred choice for many real estate brokers in the Baltimore area. If you have any questions concerning issues that Baltimore title insurance protects you from, feel free to contact us at 410 884-1160 or visit today!


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