Title Insurance: More Important Than Ever

Title insurance is an important piece of your home purchase. By understanding what title insurance is and what it covers, you will be better informed when it comes time to purchase your insurance at closing.

No matter where you buy your home, title insurance may seem like an extra expense to the already expensive undertaking of purchasing a home. You've already paid escrow funds along with realtor fees and fees for the title search and now you have another expense? But title insurance exists for good reason. 
Protection From The Unexpected
When it comes right down to it, title insurance protects you from unforeseen claims arising against your property. These claims may come in the form of liens against the house, probate issues or even old-fashioned forgeries. Although, it seems unlikely, it does happen and perhaps even moreso in times of economic stress. Higher foreclosure rates may also contribute to more and more claims against a property. From a particularly nasty divorce to unpaid contractors, the possibility of claims arising against the property do exist.
Imagine you've purchased a home when suddenly, Uh-oh, that contractor who put the new windows in for the previous owner shows up claiming he never got paid. Suddenly you've got a claim against the house. Or, suppose the sellers were going through a divorce and one party forges the others' name on the selling documents. The put-upon spouse could come back to you and claim the house was sold under false pretenses and try to get it back from you. Now, in all likelihood, these things won't happen, but if they do and you are forced to go to court to fight them you're out big bucks! Not to mention what happens if you lose the case! You could lose the house.
With title insurance you have protection against these claims. 
The Process To Get Title Insurance
So where and when do you get title insurance? The insurance is obtained during the process of purchasing a property and paid for at closing.  Buyers will need to purchase a separate Owner's Policy.
Once you make an offer, put up your escrow funds and it has been accepted by the seller, the title agency will perform a search of the records on the property to ensure it is free and clear of liens. Most obvious liens will be found. So, then, this makes people wonder - do I need title insurance if I get a title search done? The answer is yes. Like every other type of insurance, it protects you against the unexpected. Which, in this case, are unexpected claims against your property. But, unlike other forms of insurance, you only pay for title insurance once and never again.
In the grand scheme of things, the few hundred dollars you'll spend on the policy may be the best money spent on your property purchase.

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