Buying a new home is a huge step – and one that is a lengthy process in and of itself. One of the last few pieces to the puzzle that is buying a home is working with a title insurance company to make sure that your new home is exactly that: your new home. Title insurance involves a thorough search through property records to ensure that you are free and clear to buy your new property without an error or mistake buried somewhere in the deed, title, and miscellaneous paperwork. Additionally, title companies issue an insurance policy that will cover expenses in the event that someone challenges your title, and will compensate you for your equity should you lose the challenge.
To help you decide whether title insurance is right for you, we’ve put together some questions to think about.
What coverage do I need? Typically, owner’s policies protect one from various scenarios such as fraud, forgery, undisclosed heirs, and spousal claims. However, if you want additional coverage, that can bump up the price.
Who pays for title insurance? Title insurance usually includes an owner’s policy and a lender’s policy, however the person responsible for purchasing the policies can vary from state to state. One thing to keep in mind is that this can be negotiated as part of the sale, whether it is the full sum of the policy or a part of the overall cost. Another thing to keep in mind is if you purchase the owner’s policy and the lender’s policy from the same company, you might qualify for a substantial discount.
How do I decide who to use? Most realtors, lenders, and even sellers have their own preferred title companies. In this case, your best bet is to go with the lender, as their interests will best align with yours, as they are guaranteeing you money based on the assurance that the property you purchase will be yours and yours only. If a seller is pushy about a title insurance company, consider that their company may not find any new or previously undisclosed issues.
Title insurance is meant to make buying a new home an easy process, one that guarantees you do not have to worry about legal ownership at any point in the process. If you have any questions about title insurance, please give us a call at 410-884-1160 or visit our website at ColonyTitle.com.
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.