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The Importance of title insurance

Lawyers Land & Title Services offers title insurance for property owners. Typically title insurance is called an Owner’s Policy, and covers the amount of the real estate purchase. The owner of the real estate purchases title insurance one time at closing, and is valid as long as the owner, or their heirs, retain an interest in the purchased real estate. An Owner’s Policy fully protects the buyer should a covered title problem arise with the title that was not found during the title search. Possible hidden title problems can include:

• Errors or omissions in deeds
• Mistakes in examining records
• Forgery
• Undisclosed heirs

Title insurance for mortgage lenders title insurance is called a Loan Policy. Most lenders require a Loan Policy when they issue a mortgage loan. The Loan Policy is usually based on the dollar amount of the loan and it protects the lender’s interests in the property should a problem with the title arise. It does not protect the buyer. The policy amount decreases each year and eventually disappears as the loan is paid off.

  • Title Insurance FAQ
  • What is title?

    Simply stated, the title to a piece of property is the evidence that the owner is in lawful possession of
    that property.

  • What is title insurance?

    Title insurance protects real estate owners and lenders against any property loss or damage they might experience because of liens, encumbrances or the defects in the title to the property. Each title insurance policy is subject to specific terms, conditions
    and exclusions.

  • How does title insurance differ from 
other insurance?

    Insurance such as car, life, health, etc., protects against potential future events and is paid for with monthly or annual premiums. A title policy insures against events that occurred in the past of the real property and the people who owned it, for a one-time premium paid at the close of the escrow.

  • What does it cover?

    Title insurance protects against claims from defects. Defects are things such as another person claiming an ownership interest, improperly recorded documents, fraud, forgery, liens, encroachments, easements and other items that are specified in the actual policy.

  • Who needs it?

    Purchasers and lenders need title insurance in order to be insured against various possible title defects. The buyer, seller and lender all benefit from the issuance of title insurance.

  • How is a title policy created?

    After the escrow officer or lender opens the title order, Stewart Title begins a title search. A preliminary report is issued to the customer for review and approval. All closing documents are recorded upon escrow’s instruction. When recording has been confirmed, demands are paid, funds are disbursed, and the actual title policy is created.

  • What is escrow?

    Escrow refers to the process in which the funds of a transaction (such as the sale of a house) are held by
    a third party, often the title company or an attorney in
    the case of real estate, pending the fulfillment of
    the transaction.