5 Things To Know About Title Insurance

Whether you are a first-time homebuyer or long-time property owner, you should be insuring your title. We all know this. By now, you may have done some research into insurance coverage for your property. After all, you keep hearing how important title insurance is. However, there are probably still a few things you have questions about in your search. More often than not, you keep coming back to the burning questions: just what is title insurance, and why do I need it? We at Prairie Land Title want to shed more light on title insurance and key things you should know about it.

Title insurance protects you from potential problems with an ownership title once you buy real estate. These may be problems that existed before the purchase. Unpaid property taxes, fraud or forgery, and a spouse or unknown heir who claims they own the property are a few examples.

1. Title Insurance helps ensure that Ownership Rights are protected. During the search and underwriting - defects, liens, and encumbrances - which the title company can detect could affect your ownership interest in the property. An Owner’s policy is often confused with a homeowner’s insurance policy. A homeowner’s insurance policy protects the owner from future occurrences such as fire, flood, accidents, etc. An Owner’s policy protects against events that have happened in the past that could impact who has rights to the land.

2. When a lender is loaning funds for the purchase, two different policies will be issued. When a loan is involved, the lender will require that a Lender’s policy be issued, which protects their lien against the property.

3. Prairie Land Title will try to resolve any issues before closing to protect the buyer’s interest in the real estate. We use the public records to find and cure, if possible, issues from the past that can affect the new owner’s interest in the property. Your Owner’s policy protects you if liens are not disclosed by the title examination that is not reported on your policy.

4. The Owner’s policy issued is a one-time fee. The premium is usually paid at closing by the seller. The new owner is covered under this policy as long as they or their heirs own the land. The Lender’s policy is only valid until the loan is completely paid off or refinanced. Regardless of the lender, if there is a new mortgage signed, then there will be a new Lender’s policy issued.

5. The seller typically chooses the title company. Title companies are independent in the sale of a property. Your real estate agent will be able to recommend a company that is trustworthy to you. Real estate agents do business with title companies throughout the year and will put you in touch with the best!

Our goal at Prairie Land Title is to ensure you are protected during and after the sale or purchase of a home. We can’t stress enough the importance of title insurance and how it can protect your future!