Title Insurance Basics

Buying a new home is one of life’s most gratifying experiences. As you approach the big day of closing, however, all the details can be a little overwhelming. You might easily overlook the single most important step in the entire process - the purchase of title insurance on that wonderful new home of yours.

What Is A Title?

A title is the legal evidence that a person has ownership and possession of land. Since it is possible that someone other than the owner has the legal right to the property, the premium coverage offered by an Owner’s Title Insurance Policy is a MUST for the added peace of mind.

There can be a number of problems that remain undisclosed even after the most careful search of public records. These hidden “defects” are very dangerous. Sometimes these defects are not discovered for months or years after you purchase your home. You could be forced to spend substantial sums on a legal defense to protect your rights. With an Owner’s Title Insurance policy you are protected.

Two Types of Title Insurance

Your lender will require that you purchase a Lender’s Policy. This policy only insures that they (the lender) have a valid, enforceable lien on the property. It does not protect you! The Owner’s Title Insurance policy, on the other hand, is designed to protect your equity.

How Much Does Title Insurance Cost?

The one-time premium is directly related to the value of your home. Typically, it is less expensive than your annual auto insurance. It is a one-time only expense, paid when you purchase your home. Yet it continues to provide complete coverage for as long as you or your heirs own the property.

The Owner’s Policy provides complete protection from these and a host of other hidden defects:

• Creditor Claim
• Undisclosed Heirs
• Mistakes In Recording
• Incorrect Legal Description
• Forged Deeds
• Errors In Tax Records

In addition to all of the coverage provided in the traditional owner’s policy, some policies offer many expanded coverages.

Now you can also insure against:

• Zoning Violations
• Subdivision Law Violations
• Improvements That Encroach Into An Easement
• Unmarketability Of Your Title
• Inflation

These expanded policies provide more coverage than ever before. Now you can have the peace of mind that your title is protected in many additional ways. Purchasing an Owner’s Policy when you close on your home provides you with lasting protection and coverage.

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Contact a Massachusetts Real Estate Lawyer

For more information regarding the preparation and filing of a homestead, or if you are looking for a real estate lawyer in Massachusetts, please contact Rob D. Stewart. If you prefer, you can also telephone our offices in Boston seven days a week at toll free 866-414-0400.

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