Title insurance can be confusing, and we are asked all the time if you have to have it for your home here in Florida. The answer can be tricky, which is why we’re taking the time here to explain title insurance in brief and if you need to have it.
A-1 Title Services strives to be the best title company to partner with for your title and escrow services and closing. We offer a smooth experience for every party involved, the buyer, the seller, and the real estate agency. Our mission is to make this final step an easy one so you can finally have the home of your dreams or sell your home and move on to your new adventure.
Below, we’ll look at the requirement of title insurance.
In brief, title insurance protects the buyer of the property should an issue arise with the property’s title that was not uncovered during a title search. Title searches are performed prior to a property being sold in order to see if the title is free and clear, meaning there are no outstanding liens on the property or claim to ownership that are unresolved. The vast majority of the time, those selling the home have the legal right to do so, and the title search comes up free and clear. However, cases have arisen where this is not the case — and as the buyer, you could be liable if something crops up after closing.
That being said, title insurance in the state of Florida can be broken down into two types: lender’s title insurance and buyer’s title insurance.
Let’s examine the difference below.
Lender’s title insurance.
Lender’s title insurance, or a loan policy, is for if you are purchasing a home with a loan. If so, the lender wants to be guaranteed they are protected should something happen with a claim on the home. If you are getting a mortgage on your home, then lender’s title insurance is required in the state of Florida to protect the lender from the risk of a bad title.
Buyer’s title insurance.
A buyer’s title insurance, or an owner’s policy, protects the buyer from an unclean title. This is not required in the state of Florida because you yourself are assuming the risk if you don’t purchase an owner’s policy title insurance. However, you could lose everything — including your home — if you don’t buy title insurance.
The nice part about title insurance is that this does not have to be an up-front cost. You can fold both costs into your mortgage and pay for it gradually over time. Yes, the buyer does pay for the lender’s loan policy in the state of Florida.
BOTTOMLINE ON TITLE INSURANCE
Everyone involved in a real estate transaction hopes that the title is free and clear with no problems. However, like everything in life, there are no guarantees, which is why insurance exists in the first place — to protect you from the unexpected in life.
Some possible scenarios that can arise that title insurance would protect you from are:
- A lien of any kind, such as construction liens or tax liens
- Foreclosure complications
- Inheritance disputes
- Eminent domain
- Title is a joint tenancy or tenancy in common
- Right of survivorship claim if one owner passes before the other
A-1 Title Services always errs on the side of caution, and we recommend that everyone purchase title insurance in the state of Florida for their home. The cost for the title insurance is very minimal considering the cost you will pay for the home. Title insurance is a one-time premium that you pay, and it covers you for as long as you or your heirs own the property. It’s always better to be safe than sorry, and while these instances are rare, humans do make errors, and what was thought to be a clean title could not be years down the road.
WHY CHOOSE A-1 Title Services FOR YOUR HOME LOAN CLOSING
A-1 Title Services puts a lot of emphasis on your closing experience. We believe in making your home loan closing easy by being prepared with the paperwork ahead of time and ensuring nothing is forgotten. It can be frustrating getting a call from your title company after you’ve closed your home, saying you need to come back in and sign a document (or, go online like what we offer). Either way, it’s not something we desire.
What home buyers and sellers don’t see are the hours of work that goes into your perfect loan closing, which includes the Florida title search. A-1 Title Services prides itself on being diligent in all aspects of our job, including doing everything possible to avoid the use of title insurance. We investigate thoroughly titles on properties we are closing on to help ensure there are no issues that could arise in the future. This is a very important part of home closing, and as you’ve just seen, one mistake could be very costly for all those involved.
A-1 Title Services has decades of experience in Florida title searches and in home loan closing. Whether you are purchasing a home, a piece of property, or a commercial business, you want to ensure that every legality is taken care of. The title company that you choose to handle your property purchase can make all the difference. Our title agency is here to serve you in every way, and if you have any questions about a title search or about the title process, please don’t hesitate to ask.
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