What Does a Title Company Do?
A title company oversees the interests of all parties, consisting of buyers, sellers, lenders, real estate agents and coordinates the transfer of money and property at the time of closing. Prior to settlement the title company will research the ownership history of the property (which is called the title examination) to determine that the title is free of any liens or claims. At the settlement table, the title company collects and distributes funds from the transaction, transfers ownership of the property, and issues title insurance.
What is Title Insurance and Why do I Need It?
The title insurance protects you, the property owner, and the lending institution that holds your mortgage from unforeseen claims that may arise against your property. The policy provides protection from financial loss and payment of legal costs associated with such claims.
Is a Title Exam Sufficient Without the Need for Title Insurance?
No. A title examination is only as good as the land records. Should a filing error happen, if someone perpetrates a fraud,or if an estate is mishandled, the title insurance protects you, even thought the title examination did not and could not disclose the problem.
Do Title Companies Charge Different Rates for Title Insurances?
Title Insurance rates are set by state insurance commissions and are based on the purchase price of your property (owner’s policy) and the loan amount (lender’s policy).
Am I Required to Purchase Title Insurance?
Most lenders will require that you purchase a lender’s title Insurance policy. This protects their investments in your property. You are not required to purchase an owner’s policy; however, your one-time payment will protect your property for as long as you own it.