5 Tips for Buying Title Insurance

When compared with the cost of buying a new home, which can amount to an excess of hundreds of thousands of dollars, purchasing a title insurance policy is relatively minor. This investment ensures that the homeowner is protected from losses or damages incurred due to an issue originating before the time of purchase. Paying the price for a previous owner’s negligence is undesirable, to say the least. Title insurance ascertains that the current proprietor will be spared such an unfortunate eventuality.

The erasure of the risk of losing one’s home due to unforeseen circumstances provides a compelling reason to invest in such a policy. On the other hand, acquiring the right policy can leave many prospective homeowners feeling perplexed. What follows is a list of five tips whose aim it is to inform those in the market for title insurance.

Get Full Coverage

In the event that, for whatever reason, the ownership rights of the property come into question, the owner will want to be covered for the full amount paid for it. Those lacking adequate coverage risk forfeiting $50,000, $100,000 or more.

Invest in a Lender’s Title Insurance Policy

Homebuyers would be well-advised to acquire a lender’s title insurance policy. This serves to cover the bank’s investment in the property up to the mortgage’s full amount. The mortgage down payment and other costs associated with purchasing the property should be taken into consideration when determining the degree to which one should be covered. A lender’s title insurance policy bears the added incentives of reducing the price of the home and ensuring that the relationship between bank and buyer is financially sound. Visit Marina Title’s Residential page for more information.

A Lender’s Policy Does Not Protect the Homeowner

Owning a lender’s policy in conjunction with title insurance is essential. The former provides no protection for the homeowner in the event of hidden damages which could prove disastrous down the road. Title insurance safeguards against many types of misfortunate, including potential litigation.

Refinancing Requires a New Policy

Be advised that any new lender will require that the borrower purchase a new title insurance policy when he or she sets out to refinance the home in question. This remains the case even if the borrower refinances through the bank which holds the initial mortgage. The homeowner’s title insurance, however, will in no way be affected by the refinancing process.

Caveat Emptor

Buyers who are offered a deal that seems too good to be true are strongly recommended to seek out legal counsel. Though the proposition may not be of nefarious intent, it could contain provisions that will prove disadvantageous to the buyer in the future. For example, a lawyer experienced in the complexities of titles can ascertain if a seller’s offer to pay for the buyer’s title insurance and lender’s policy is legitimate and worthwhile. A buyer should never act on such offers in the absence of sound advice from a qualified attorney.

For more information regarding title insurance and lender’s title insurance, or to buy a policy,  contact us by phone at (305) 901-5628 or by email at info@marinatitle.com.