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this article is by Todd Foust who is the chief marketing executive for the FOUST Team at C21 Discovery; one of the top-selling real estate teams in Southern California
When it comes to real estate, we all know by now that things are not as simple as finding the home of your dreams and going on with your life.
Real estate comes with some strange procedures, terms, and lingo which can become very overwhelming to consumers. Despite the potential for confusion, there are some questions that they absolutely should be asking, particularly about the subjects of title and title insurance.
We have found that obtaining answers to these questions will help alleviate much of the normal home buying anxiety. With this in mind, here are the 3 best title insurance questions consumers should be asking, and the typical answers we would give.
Top Question #1 - What is Title?
Our Answer: The word "title," obviously, can mean a number of things. In real estate, when you hear "title," it is referring to one's right to ownership, or any form of evidence of land ownership. Simply put, you need to know is that having title means you have the rights to that land.
Top Question #2 - What is Title Insurance and Why Do I Need It?
Our Answer: Title insurance is a protection mechanism that will protect you against any kind of damage caused by a defect in the title. In California, for example, a standard title insurance policy will protect against things such as forgery, impersonation, and the expenses incurred in defending the title. Title insurance not only verifies ownership, it will also detect any possible "clouds" on your title. Clouds could be in the form of IRS claims, liens, or other uncertainties of ownership.
Speaking in more detail, consumers should know there are two different title insurance policies issued in every real estate sale. The first type is an owner's policy, which will protect the new owner from any ensuing claims to the property. The second type is a lender's policy, which will protect the lender against loss of an unpaid loan balance in the event of a claim.
Title insurance policies are important because they protect against possible non-recorded claims against your property and ensure free and clear ownership. As such, these policies benefit consumers in establishing safety and security in owning real estate.
Top Question #3 - Who Pays for Title Insurance?
Our Answer: Although there is not just one way to pay for title, one method stands out as the most common. As mentioned before, there are two types of policies: a lender's policy and an owner's policy. As far as the lender's policy goes, it is usually paid for by the actual buyer of the real estate. The owner's policy on the other hand is paid for by the seller of the real estate. Of course in real estate, almost everything is negotiable, but this is typically the way the policies are paid.
1:56 PM - Aug. 14, 2009 - {0} -
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