What the Heck is Title Insurance?

A scale house on some forms for a deed to conceptualize on the financial investment.

What the heck is title insurance? Why should you buy it?

Well… unless you are paying for your home entirely in cash, lenders will not let you purchase a home without title insurance.  Title insurance ensures that the sellers truly own the property and that there aren’t any problems with the title.

Common Problems with Titles:

1) A previous owner had some construction done on the home and never paid the contractor.  The contractor can place a mechanic’s lien on the title.  You didn’t have that work done, so you shouldn’t have to pay for it.

2)  A previous owner skipped out on paying their property taxes, which resulted in a lien being placed on the title.  Liens are placed on the property, not on the individuals, so new owners need to protect themselves against the antics of previous owners.  T

3)  Forgery! There have been cases of forgery where scam artists search public records to find homeowners who reside out of state and attempt to sell the property as their own on the internet!  (There are so many creative honest ways to make money in this world, it always blows my mind when people do things like this to try to make a buck, but… it happens.)

4)  There are sometimes cases of missing heirs… maybe a child was left in the will and became estranged from their family… years later, the prodigal son or daughter returns and technically has claim to the property. Should this be your problem if you bought the house fair and square?  Of course not!

Title insurance protects home buyers against all of these potential issues and more.