The Reason for Title Insurance w/ Mortgage Attorney, Molly Sutter
The Importance of Title Insurance:
Insights from the Raegan Thorp Real Estate Group
One thing that has consistently stood out to me in the real estate industry is the importance of building strong relationships. I’ve had the pleasure of working with Molly with Campbell & Brannon for several years, and she has expertly guided my clients through the property closing process as their attorney. This week, we want to shed some light on a critical yet often misunderstood aspect of real estate transactions: title insurance.
Why Title Insurance Matters
Recently, one of my clients was selling a condo she bought five years ago. During the process, we discovered an unresolved issue with the title that dated back to when she initially purchased the property. We had to track down the previous seller to resolve this issue. Thankfully, she had title insurance, which was instrumental in addressing the problem. This experience highlighted the value of title insurance and why every buyer should consider it.
Understanding Title Insurance
To help explain the intricacies of title insurance, I’ve asked Molly to break it down for us.
Two Types of Title Insurance
Molly clarified that there are two types of title insurance policies: the lender’s policy and the owner’s policy.
Lender’s Title Insurance Policy:
Protects the lender’s interest in the property.
Only covers the lender’s investment in the property.
Does not protect the buyer’s ownership.
Owner’s Title Insurance Policy:
Protects the buyer’s full ownership interest in the property.
Covers the purchase price of the property.
Essential for safeguarding the buyer’s biggest investment—homeownership.
Why You Need an Owner’s Policy
For most people, buying a home is the most significant investment they will ever make. While homeowners insurance protects the physical structure of your home, title insurance protects your ownership rights. As Molly put it, having your own policy ensures that your investment is secure.
What Does Title Insurance Cover?
Title insurance offers protection from a range of potential issues, including:
Errors from Previous Title Reports: Mistakes made during previous title examinations can resurface when you decide to sell your property.
Deed Forgeries and Mortgage Fraud: These risks are increasingly common, and title insurance can protect you against them.
County Recording Errors: Mistakes made when recording deeds can affect your ownership rights.
Liens from Previous Owners: Title insurance can protect you if a lien is discovered that was placed by a previous homeowner.
Molly emphasized that title insurance is not just about protecting your investment when you sell but also while you own the home. It provides peace of mind against a variety of potential legal and financial pitfalls.
Final Thoughts
In summary, title insurance is a crucial component of any real estate transaction. It protects your ownership rights and ensures that your investment in your home is secure. Whether you are buying or selling, having a solid title insurance policy can save you from significant headaches down the road.
Thank you, Molly, for breaking down the importance and benefits of title insurance. Stay tuned for more insights and tips in our next discussion.
If you have any questions about title insurance or other real estate matters, feel free to reach out to the Raegan Thorp Real Estate Group. We’re here to help you navigate the complexities of buying and selling property with confidence.
Until next time,
Raegan Thorp
