True or false? Title insurance will protect you if you buy a home and later find out there are title problems. Answer…it depends. Of the many details involved when buying a home here in San Diego, one that’s often overlooked is the role of title insurance.
The concept of title begins simple enough. It’s about ownership, but things can quickly get complicated if problems arise with liens, encroachments, missing heirs, easements, boundary line disputes, unpaid taxes, mistakes in the deed, forgeries, and so on. Title insurance can provide protection against these risks, yet even though lenders require title insurance, the policy purchased may have nothing to do with protecting your own interests. That’s because there are two types of title insurance policies: a lender’s policy and an owner’s policy. A lender’s policy doesn’t cover your down payment, monthly payments, or any increase in property value, and the coverage disappears once your loan is paid off. For protection against your own financial loss in this major investment, you’ll need to buy homeowner’s title insurance.
During the recession, owner’s title insurance may be even more worthwhile for those who are buying property as a result of a non-judicial foreclosure, since there’s the added risk that required procedures weren’t properly followed. If you decide to buy your own title insurance, a recent Wall Street Journal article by James Hagerty recommends that you shop around and start early, instead of simply going along with the insurer picked out by your real estate agent or mortgage company. Whether you’re buying or selling real estate, we’ll carefully examine the transaction and potential title issues, and take any necessary legal actions to resolve title and deed problems. Be sure to contact San Diego Law Firm’s real estate attorneys early on by calling (619) 794-0243.
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