If you’re purchasing a home for the first time, you may or may not be aware of the importance of title insurance. You may be looking on this blog for the first time, wondering what title insurance even is! Other types of insurance, such as homeowners or car insurance, may be simple to understand, but title insurance is a little harder to grasp. Let’s learn a little more about what title insurance actually is, and why it is important.
Protection Against Claims
In home-buying, a title gives you legal ownership of a property. As the legal owner, you are solely responsible for any claims against that property, even those by previous owners. So, for example, say you purchased a home and found out after closing that the previous owner had not paid property taxes for several years. As the new owner, you have assumed those outstanding debts and would be legally obligated to pay those back taxes. Or you may find a previous owner that did not sign off on the sale of the property and wants to file a claim in the ownership of the property. Title insurance is designed to protect you against these kinds of claims.
Title Insurance Prevents Headaches
A good title company will do the research on the title of a prospective sale to determine if there are any outstanding claims or liens on the property. That way any problems can be cleared before you assume ownership. You pay the title company a one-time fee for the insurance that covers the home for the duration of your and your heir’s ownership of the property. Liens and claims on a property rarely turn up after a sale, but the insurance fee mostly covers the initial research and clearing of trouble before the sale goes through. Title insurance is an important tool for a homebuyer and should not be overlooked. It may save you money and a lot of preventable headaches.
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 take advantage of the record low mortgage rates to come. 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+.