Common Questions
How does title insurance protect me?
What can happen without title insurance?
Do I need an owner's policy if my lender already has a loan policy?
Why do I need title insurance if I am refinancing?
Why do I need title insurance if my house is brand new?
Can I choose my title insurer myself?
How can I know how much my title insurance will cost before I get to the closing table?
How does title insurance protect me?
As a homeowner, title insurance protects your investment before you even close your transaction. Title insurers conduct a thorough search to unearth and resolve potential problems, such as duplicate deeds, mistakes in the public record, and fuzzy property boundaries, prior to issuing your insurance. Once a title policy is issued, title insurance also protects you legally and financially from hidden hazards that sometimes emerge after closing, such as forgeries, mechanics' liens, and more. The best part: even though you only pay for it once, an owner's policy of title insurance protects you for as long as you or your heirs have an interest in the property.
What can happen without title insurance?
Imagine getting a knock on the door of the home you've owned for a couple of months, and encountering a man who says he's the rightful owner of your house. So you do a little digging and find out that the sellers you bought the home from weren't the real owners, but people who have stolen the owner's identity and are posing as the owners. They searched the public records for a home with out-of-state owners, forged and recorded a fictitious deed, then sold the property to you before the real owners (or you) discovered the scam!
This is just one of so many issues that can turn up after you take ownership of your home. Tax liens, undisclosed mortgages, forged signatures in the chain of title, recording errors, title search errors, undisclosed easements and title claims by missing heirs and/or ex-spouses - these are just some of the pre-existing problems for which you could be found legally and financially responsible, even though you had nothing to do with them.
That's where the protection of title insurance comes in. Bringing both legal representation and financial resolution, your owner's policy of title insurance makes sure that these types of claims don't jeopardize your homeownership rights.
Do I need an owner's policy if my lender already has a loan policy?
Yes, you do. You see, the loan policy of title insurance on your home protects your lender from any liability regarding his or her investment in your property - but it does nothing to protect you, the owner. Only an owner's policy of title insurance protects you from legal and financial liability regarding past problems with your title.
Why do I need title insurance when I'm refinancing?
This is a very common question. The answer is that you won't need to get a new owner's policy of title insurance, but your lender will require a new loan policy. That's because when you refinance, you are technically obtaining a new loan, even if you stay with your original lender. Your lender will require lender's title insurance to protect their investment in the property. They'll want a title search performed to look for any problems that might have arisen since the previous loan policy was issued, like mechanic's liens, marital rights claims or unpaid taxes. They simply want to ensure that the title to your property is clear before they provide your new funds. You don't need to purchase a new owner's policy, though; the one you bought at closing is good for as long as you and your heirs have an interest in the property.
Why do I need title insurance if my house is brand new?
Even though you may be the first owner of a newly constructed home, there were most likely many previous owners of the unimproved land your home sits upon. Title insurance will unearth and protect you against any preexisting issues, such as mechanics' liens, boundary issues, or other problems associated with the property, and will pay for any legal fees involved in defending a claim.
Can I choose my title insurer myself?
Absolutely. It's your right to choose the title insurer you'd like to have protect your home. Your real estate agent, lender, and others can provide you with good information on the insurer they recommend. But you can also shop around and choose the company that provides the best cost and coverage for you. This Web site, for example, can provide you with a guaranteed title cost that you can use to compare pricing with other title companies. It's your home and your money - with a little shopping, your title insurance provider can be your choice, too.
How can I know how much my title insurance will cost before I get to the closing table?
It's this simple. Go here to get a guaranteed cost that you can use to compare, and share with your real estate agent or lender:
Additional page content recommendations, as site build-out continues:
- Consumer Help Links
List of links to other Web sites that assist homebuyers through the closing process, i.e. ALTA, CLTA, HUD.
- Operations and Agents in Your Area
List of First American direct operations and agents within California county areas.
- Loan Calculators
Standard calculation options for determining loan amounts and payments.
