One fee you may pay when you buy a home is for an owner’s title insurance policy and for a lender’s title insurance policy. Title insurance for a lender assures the lender that you own the home free and clear, with no liens on it. When you buy title insurance a title company will run a title search to check public records for information on the home. When you get an owner’s title insurance policy, the title insurance company protects you from title issues that your real estate property might have had prior to your ownership. It may be fraud, it may be a lien that is not discovered, or another title issue. In these instance, the title company’s title insurance policy will protect you from undisclosed issues. Who pays for the title insurance varies by state – sometimes it’s the buyer, sometimes the seller. Learn the ins and outs of title insurance here.
Even if you're not legally required to buy title insurance, not buying title insurance is a mistake. Get title insurance and give yourself peace of mind. You might be very sorry if you don't get title insurance if there were errors in the conveyance documents or unknown issues that could cause a problem on your title.
Why should I purchase title insurance when my house is paid for? Title insurance companies provide the service of searching the public records and furnishing a report called a title insurance commitment. The cost of title insurance varies greatly from state to state. Title insurance should not be thought of a a real insurance policy. Think of it as a cost of selling your home.
Before you go to closing, ask about your title insurance protection, and be sure to protect your home with an owner's title insurance policy. Just because there is a title commitment does not guaranty that the seller can convey "good" title to a buyer. If the title company has done a good job searching the title to the property, you, as the buyer, will have a good understanding of the issues that will affect your title.
When a property line is incorrectly recorded it results in title problems, which can delay or prevent a home sale. To resolve this kind of title problem, you have to correct the documents filed with the homeowners association and possibly create an easement so that the property line becomes acceptable. It may also be worthwhile to ask the developer to modify the documents that describe the property line.
When you're applying for a mortgage loan you need to look out for extra fees that mortgage lenders may charge. Some of these extra fees, such as extra money toward credit reports or appraisals, are illegal under RESPA, the Real Estate Settlement Procedures Act. Learn more about what mortgage fees to watch out for here.
When you're buying a home your lender will likely ask you to buy title insurance. Title insurance covers the cost of a title search to make sure you have a clear title. Title insurance protects the lender in case it's later discovered that there's a problem with the title. When you're buying a home, it's a good idea to get an owner's title insurance policy too to protect you.
Having the correct insurance coverage will help save you when you need it most. Whether you rent or own, buying homeowners or renter's insurance is a necessary part of life. If you rent, you need to protect yourself in case your belongings are damaged or stolen. If you own your home, you need to protect yourself financially should something happen to your home. What other kinds of home-related coverage do you need? You may need personal property, personal liability, or homeowners insurance. Make sure you don't fall into these common insurance mistakes.
When selling your home, it's easy to get caught up in the excitement of an offer. But sellers need to remember the little details for smooth sailing to the closing of their home.