Condominium/Real Estate Law Blog
Why Title Insurance is Necessary when Purchasing Real Estate
Posted by Jeff Barnes on November 16, 2011
Title companies search public records relating to the subject property and then generate an opinion concerning the chain of title. Each title is different; however, every title contains information about the property owner and the property owner’s rights and interests in the property. Besides the owner of record, other people or entities may have an interest in the same property by way of an easement or mortgage of which these rights may pass on to any new owner unless properly discharged of record. Given the above, it is essential that the buyer know what rights the seller is permitted to pass along. For a one time only premium, a buyer can receive title insurance that protects the buyer from claims arising out of title problems that could have been discovered and those defects that could not have been discovered even with the best title search. This title insurance also provided coverage to the owner’s heirs. Even the most comprehensive title search may miss a defective recording, liens, judgments, inheritance tax and unknown relationship to an earlier owner. Considering the size of your investment, obtaining title insurance is a small price to pay to protect against title issues.
If you have any questions about the above information, please do not hesitate to contact me to discuss how it pertains to your unique situation.
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