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What
is a title?
What
is a title search?
What
kinds of problems can a title search reveal?
What
is title insurance?
How
much can I lose if a claim is filed against my property?
Are
there different types of title insurance policies?
How
much does title insurance cost?
How
long does my coverage last?
What
is a title?
A title is an owner's right to possess and use the
property.
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What
is a title search?
A title search is a detailed examination of the
historical records concerning a property. These include: deeds, court
records, property and name indexes, and many other documents. The purpose
of the search is to determine that the ownership of the property is clear
of liens, additional mortgages and other claims against it.
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What
kinds of problems can a title search reveal?
A title search can uncover title defects and liens,
as well as unpaid taxes, unsatisfied mortgages, judgments against the
seller, and restrictions limiting the use of the land.
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What is title insurance?
Title insurance protects you against any possible
hidden hazards which were not uncovered during a title search, such as
the previous owner incorrectly stating his marital status resulting in
a claim by his legal spouse, fraud, forgery, defective deeds, mental incompetence,
confusion due to similar or identical names and clerical errors. Unlike
other forms of insurance that focus on possible future events and charge
an annual premium, title insurance is purchased for a one-time payment.
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How
much could I lose if a claim is filed against my property?
It depends on the claim. In an extreme case, you
could lose your entire home and property-and still be liable to pay off
the balance of your mortgage. Most claims aren't that extensive, but even
the smallest claim can cost you time, money and aggravation, and you may
have to pay costs for a legal defense.
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Are
there different types of title insurance policies?
Yes. Basically, two types-a loan policy and an owner's
policy. The loan policy protects the lender's interest in the property
as security for the outstanding balance under the buyer's mortgage. The
owner's policy safeguards the buyer's investment or equity in the property
up to the face value of the policy. In many states, title insurers offer
increased policy coverage through inflation endorsements to cover increases
in value due to inflation.
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How
much does title insurance cost?
A lot less than you might think. Charges differ
in various areas of the country, but generally the cost of title insurance,
which includes the title search, examination and related services, amounts
to approximately one percent or the cost of the property, or even less.
Unlike other insurance premiums, which are paid annually, a title insurance
premium is paid one time only, usually at settlement.
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How
long does my coverage last?
For as long as you or your heirs retain title to
the property, and sometimes even beyond that.
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