What is title insurance (owner’s policy)?

Title insurance is a form of indemnity insurance that protects homebuyers from financial loss sustained from defects in a title to a property.

Do I need both loan AND owner’s policies?

As a buyer of real estate property, you’ll want to protect your major investment as well as the ownership rights that come with it. That’s why it’s wise to purchase an owner’s policy of title insurance in conjunction with the loan policy your mortgage lender will require you to purchase.

What are some the most common claims title insurance will protect me against?

Some of the most common issues are:

  • Existing Liens and their priority.
  • Fraud and Forgery
  • Undisclosed heirs and marital rights
  • Violation of zoning or building permits
  • Property’s improper legal description
  • Encumbrances
  • Escrow and Closing errors etc.

What does a title search process involve?

A title search is a complex process, one that very few homeowners recognize, at the time they purchase their home. When you purchase title insurance, Five-Star Abstract professionals will conduct a public records search to identify and correct, when possible, any issues that could affect your right to own your property.

What is the typical price of an average title insurance policy?

Since it is a highly regulated industry, title insurance policy costs will vary from state to state. In general, however, each policy price is based on the purchase amount of the home (for an owner’s policy) or the total amount of the loan (for a loan policy). In case of owner’s (title) insurance policy, you should be looking at approximately $2.50 per $1000 dollars of your home value.

What is the difference between loan and title (owner’s) policies?

The two main types of title insurance policies are an owner’s policy and a lender’s policy. Homeowners need an owner’s policy, while the lender’s policy protects your lender from any losses that could come up if the property’s mortgage is invalid.

How long does owner’s policy last?

It lasts as long as long as you or your heirs retain an interest in the property or remain liable for any warranties on the title.

Are their monthly or annual premiums for title insurance?

No! You pay for title insurance (owner’s policy) only once. There are no additional costs or ongoing premiums involved.

How common are title deffects?

Title defects are found in approximately 25% of real estate transactions. This is every forth title.

Will you perform a public records search before issuing a title (owner’s) policy?

In order to significantly reduce or completely eliminate risk, the process of issuing a title insurance policy includes a thorough search of public records and court documents to assess and remove any issues on the property’s title, when possible.

Who are your title insurance underwriters?

Five-Star Abstract has a successful relationship with both First American and Conestoga underwriters.

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