There is perhaps no greater investment you’ll ever make in your life than the one you put into your home. It’s where you’ll live out the rest of your days, build memories with your family, and take part in an amazing community. But what steps do you take to make sure your house and possessions are protected from damage and/or theft?
This isn’t just about home insurance. Most buyers already have that. But what about title insurance? At first glance, you might not even realize what title insurance does or how it can help keep you safe, but it’s an important aspect of ensuring nothing goes wrong, leaving you with a massive mess to clean up.
What is Title Insurance?
When you buy a house, there’s a lot of paperwork that goes with it. You’ll have to draw up and file legal documents, sign a mortgage, ensure all your information and data is correct (or correctly added), and so on. But what happens if there’s a mistake? What if the wrong information was added in or something was incorrectly filed?
The reality is, mistakes happen! Humans are imperfect beings and no matter how hard we try, sometimes we make mistakes. Something gets faxed wrong, we make a typo, we mistake one number for another, and so on. It happens literally every day! So why not protect yourself? Here are four reasons why you need title insurance:
Reason #1: To Protect Your Space
Yeah, your house is protected, as well as your possessions with insurance, but what happens if there’s a border dispute? Maybe someone’s tree fell on a neighbor’s house and that person claimed the tree was on your property. How do you handle the situation? You can get a survey, but the results are often different every time.
Where title insurance will help you is it will determine exactly where your property ends and where it begins. If anyone tries to challenge or dispute it, then they’re out of luck. The title insurance is your way of protecting your borders.
Reason #2: Protection from Fraud
Sometimes people are just crooked. They’re out to make a quick buck and don’t care about anyone else. Sometimes mortgage fraud happens. A ‘seller’ can create a fake deed and gets it notarized. In that case, you’d be sore out of luck because the deed would’ve been an authorized document.
People fake signatures all the time. Maybe an angry wife forges her husband’s signature to get rid of his house and you buy it. What then? Title insurance will protect you from any fraud that might pop up. It’s always better to be safe than sorry.
Reason #3: Liens
Even when you do all the research you can on a home, there still might be a certain amount of unknown history hiding somewhere. This is especially true if you plan on buying a home that’s been foreclosed upon. You have no idea who might have a lien against them, which means the bank gets to take your new home. Protect yourself with an insured title and you’ll be set.
Reason #4: All the Errors
This was mentioned in the beginning, but it’s true. People make mistakes all the time. All it takes is one mishap, one little typo, and it can count against you. It doesn’t even have to be your fault. It can be the realtor, the seller, the bank, etc. The only real way to keep yourself from losing out a ton of money is insuring that title.
Buying a home can be both an exciting and trying time. As with any major (or even minor) investment, it’s always best to protect it every way you can. Not doing so can leave you in a world of hurt. Hope for the best, but be prepared for the worst.
