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Is Title Insurance Worth the CostIs Title Insurance Worth the Cost

Is Title Insurance Worth the Cost?

10 Jun 2019

In Florida, Title Insurance is one of the requirements you need to meet for most lenders to issue a mortgage; this is for their own protection. However, as a homebuyer, you may be wondering whether Title Insurance is really worth the cost.

As a homebuyer, you must understand the importance of having Title Insurance. In this article, you will find a brief explanation of how Title Insurance works, what it can do for you, and how much you should expect to pay for it depending on the purchase price of your new home.

What is Title Insurance?

Title Insurance is a type of insurance that offers protection against any claims filed against the ownership of your property after you have successfully closed on it. There are two types of Title Insurance policies available: the Lender’s Title Insurance policy and the Owner’s Title Insurance policy. The biggest advantage of Title Insurance policies is that you only pay for them once and it will never expire as long as you own the home you insured.

What Protections Does Title Insurance Provide?

Your Title Insurance policy will protect you from hidden hazards and ownership claims against the property that may be filed after you have successfully completed the home buying process. Ideally, your Title Company will conduct a title search on the property during the closing to make sure there are no hidden issues waiting to emerge and give you headaches after you close on your new home. This helps know whether the seller has a “clear title” that is free of legal claims.

Typically, a thorough title search will reveal any hidden issues with the title to a property. So, why obtain Title Insurance after a title search has effectively shown that the title to the home is clean? Read on to find the answer to that question.

Is Title Insurance Really Worth It?

The answer is short and simple: Yes!

Unfortunately, sometimes there are certain hidden title issues that are not uncovered by the title search, which usually surface many years after you purchase the home. Examples of these issues include:

  • An unknown heir of a previous owner.
  • An oversight during the title search.
  • An error in the property’s ownership history.
  • A pending legal judgment or lawsuit against the property.
  • A fraud committed by a previous owner.

This is why you must protect yourself with an Owner’s Title Insurance policy even if a title search reveals no hidden issues. If a title defect is revealed after closing, you may be legally held responsible for paying different types of legal costs. In extreme cases, some of these “invisible” issues could lead to losing your property—one of the biggest investments you will ever make in your life, if not the biggest.

Do I Need to buy Title Insurance if there is a Warranty Deed on the Property?

Some homebuyers argue that there is no need to buy Title Insurance because the seller has issued them a warranty deed. This is a mistake. A warranty deed tells you that the seller is offering you a property with a clean title. However, it does not protect you against any ownership defects that occur several years after closing—Title Insurance does.

What Are the Title Insurance Regulations in Florida?

When it comes to Title Insurance in Florida, the seller usually covers most of the costs, including the cost of the title search and the cost of the Lender’s Title Insurance. The amount of money you (the homebuyer) will need to pay in order to purchase your Owner’s Title Insurance policy will be a percentage of the purchase price of the home you are buying—typically 0.5%.

Enjoy a Memorable Closing Experience with Marina Title!

To answer the question that inspired this article: Yes. Title Insurance is definitely worth the extra cost for those who want to make sure nothing will lead to them losing their investment.

If you are considering obtaining an Owner’s Title Insurance policy, Marina Title can help you!

To learn more about our title services, call us today at (305) 901-5628 or send us an email to info@marinatitle.com to schedule an initial consultation with one of our title professionals.

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