Acquiring title insurance as a new homeowner is crucial for protecting you and your mortgage lender against problems with a title when there is a transfer of property ownership. Issuing title insurance often includes the two steps of first, researching records to make sure the title is “clean,” and second, issuing an insurance policy that will pay for your defense if anyone challenges your title. Homebuyers typically need both an owner’s policy and a lender’s policy. Before you begin the process, ask these six questions regarding your title insurance to ensure that you are prepared.
Are My Local Title Insurance Prices Regulated?
In many states, title insurance prices will be regulated to limit significant differences among companies. Ask your lender if you’re in a cost-regulated area.
When searching for your title insurance, you should consider two factors: the quality of both the insurance and the title search. You want to find a title company that can do a thorough search and an underwriter who will be around in the future if you encounter problems.
How Much Coverage Do I Need?
A typical owner’s title insurance policy will protect you against several problems such as fraud, forgery, undisclosed heirs, and spousal claims. However, your lender might also require additional insurance on the property or mortgage. For instance, an adjustable-rate mortgage endorsement guarantees that the lender is first for repayment if the home goes into foreclosure.
Who Pays for Title Insurance?
The party responsible for paying for both title insurance policies varies from state to state. However, the price can always be negotiable, and if you are buying the owner’s and lender’s policies from the same company, there can often be a discount.
Is the Seller Pushing a Title Company?
If you are paying for your title insurance, you have the right to select the company from which you buy the insurance. If the seller is encouraging you to use their title company, you should be wary. It is often better to have a fresh set of eyes on your title search to unearth potentially new problems.
Who to Trust?
If you are getting advice from your seller, your real estate agent, and your mortgage lender regarding your title insurance, you should listen to the mortgage lender as their interests align most with your own.
How Much Reassurance Do I Need?
If you want to verify that the underwriter issuing your insurance policy is reliable, check its financial solvency with rating companies. You can also research the underwriter and the title company online to see what customers are saying about their services. Don’t be afraid to do further research before committing; your title insurance policy is supposed to help protect your property ownership. Don’t make a hasty decision rather than spend some more time selecting the right people.
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 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+.