When it comes to title insurance rates, coverage, and other important policy information, many homeowners simply don’t know the details. In some cases, the act of buying can seem so daunting that they may skip the important step of securing their investment. This simple step can actually end up saving some homeowners thousands of dollars, making it a valuable part of the process not to be missed. If you’re thinking about buying a home, read these answers to frequently asked questions so you can protect what may be your most valuable asset.

What is title insurance and why do I need it?

In some cases, property owners are surprised to discover that someone else has a lien or claim of some kind on the home they just purchased. By insuring your property purchases, you’ll be protected from claims that others make on the home and, if necessary, you’ll be reimbursed for any financial loss.

How is it possible that these types of liens or pending claims are linked to a property after it has been sold?

Property transfers have been going on for over 200 years in the United States. In those years, the transfers have been recorded and re-recorded in books, paper files, and now in computers. Sometimes errors are made when querying, copying, and transferring the records. In many cases, these types of errors can be attributed to human error. Other circumstances arise from fraudulent activity, such as someone acting as the owner of a property when they are not the rightful owner. Other common problems include unpaid property taxes, a forged signature, or incorrect property descriptions.

How long does a title last?

It remains in effect and protects your investment in your home for as long as you own the property, whether for a few years or many decades.

How much are title insurance fees and who pays them?

Title insurance rates vary from sale to sale, depending on the value of the home. In some cases, the seller and buyer split the costs of the policy, although more often it is considered the sole responsibility of the buyer. It is usually included in closing costs so the buyer does not have to worry about additional out-of-pocket costs.

How often does a homeowner pay the fee?

These are paid only once, when the policy is chosen. Many people consider this to be the most important investment a homeowner can make when purchasing a new property.

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