Your Questions About Title Insurance

Mandy asks…

What value does a real estate lawyer add on top of title insurance?

If title insurance already protects against:
– survey errors
– legal description errors
– negligence
– forgery
– liens

and negates the need for:
– zoning compliance certificate
– tax certificate
– hydro/water/gas certificates
– law society levy

what value does a real estate lawyer add on top?

Is it just for wading through the legalese in the Offer and the Agreement?

barry0912 answers:

Depends on the transaction, if it’s a refinance, I would tend to agree with you even though I don’t understand what you mean by stating title insurance negates the need for tax and water certificate. I’d also be cautious of the legal description errors. I had a situation in NY, purchase, where the deed to the property did not contain a legal description at all. The previous title company would not give us a letter of indemity for our title and then come to find out our title underwriter would not accept it, the original deed had to be found and re-recorded, no exception, so I guess it depends on what you mean by “errors” On a purchase transaction, they usually add more value due to the purchase contracts and drafting of deeds, etc. To be bluntly honest, most attorneys usually dont even touch the file unless there is a major problem, their paralegals handle the day to day operations

Lisa asks…

Who is responsible for selling a bad title insurance policy?

I had property line dispute with my neighbor and my title insurance policy(First American Title Insurance Company) does not want to pay my $7k attorney fees for preparing the claim . They did not cover my out of pocket legal fees. I was sold a crappy policy 10 years ago when I purchased my residence. Who is in charge of choosing the title insurance company? Escrow company or the agent?

barry0912 answers:

Normally the real estate agent or the escrow officer select a title company they are accustom to working with. This is prevalent throughout the mortgage and real estate industry.

What the real estate agent or escrow loan or loan officer fail to tell their clients is that they may select the services of their choice.

Even if your title was not in excess of 10 year the title company only guarantee that liens against the property after your purchase would be paid and you would be getting a clean title to the property. You did not get a crappy title insurance policy.

I have used First American Title Insurance and have found them to be a competent title company over the years.

In most states and counties a property has been assigned a lot and parcel number with the dimension recorded at the county court where the property is located. If there is a dispute about the property as to where it ends and how much is yours, then you would have to hire a survey company to complete a survey to determine property lines.

I hope this has been of some benefit to you, good luck.

“FIGHT ON”

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Your Questions About Title Insurance

Thomas asks…

How can I get a job in the Title insurance business?

I have experience conducting title searches all the way back to the 1800s but not for a title insurance company. I rarely see listings for this type of job but I know that plenty of people do this. Where can I start looking?

barry0912 answers:

I work for a title insurance company. I went through a temporary agency who was handling their staffing at the time. You could always submit resumes to First American Title Insurance Company, Stewart Title, LandAmerica Financial Group. But with the mortgage industry suffering, we have been slow. Good luck!

Sharon asks…

Are all title insurance policies required to check for liens?

We are buying a foreclosed property that offers a free title insurance policy if we use the seller’s choice for settlement. Because it is a foreclosure, the property does not come guaranteed free of liens. If I use the seller’s company, am I in danger of them not doing a full title investigation?

barry0912 answers:

A Title Insurance Policy guarantee’s a title free from liens They will do a title search to avoid a lawsuit.

This depends on whether its an OWNERS POLICY or a MORTGAGE Insurance Policy. IAre you talking about a MIP (Mortgage Insurance Policy}. You need to purchase the Owners Title Policy.

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Your Questions About Title Insurance


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Joseph asks…

Do we need to get a new title insurance when we refinance our home mortgage loan?

We bought a title insurance when we first got our home loan. We are now refinancing with another bank and they are requiring us to get a new title insurance. Is this right?

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barry0912 answers:

I work at a mortgage company, and most banks require title insurance for every mortgage that they underwrtie.

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Laura asks…

How important Is Personal Title Insurance ?

I am closing one house on 31st and my Closing attorney recommands me to take Personal Title Insuarnce ? My question is , Is Personal Title insurance necessary ? I smell something fishy here, does attorney get something if i take personal Title Insurance.

P.S I am first time home buyer.

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barry0912 answers:

Typically, when a property transfers ownership and a mortgage is put in place, there are two types of policies issued.
1. Mortgagee Policy (covers the lender’s mortgage and insures that it is the first, best lien on the property)
2. Owner’s Policy (covers the new owner’s interest in the property)

Think of it this way. You carry insurance on your car, in case there is an accident. The insurance pays for damages that may occur to your car in the future.

You (hopefully) will carry homeowner’s insurance, which will pay for damages to your house in case of a fire, etc in the future.

Your Owner’s Policy of Title Insurance protects you against things that may have happened in the past. You pay a one-time fee that is collected at closing, that insures that no one else holds any interest in your new property (except for the lender on your new mortgage). It is your proof that the chain of title was clear up until the date and time that you deed filed, and no one can claim that they are “owed” something from your home.

Examples:
1. A previous owner died, and one of the heirs did not get their portion of the proceeds from the sale of the property.

2. A previous owner divorced and their spouse did not get their half of the proceeds from the sale of the property.

3. A lien was filed against a prior owner that was never paid off and released.

If, in the future, you decide to refinance or sell the property, a new title search may be done. Chances are that a different examiner will do the search. If they come across something that shows a problem with your title prior to the date/time your deed filed, the owner’s policy protects you against that claim. You can file a claim against the underwriter who issues the owner’s policy for payment of any losses incurred.

Get an owner’s policy, and keep it with your important documents.

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Your Questions About Title Insurance


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Jenny asks…

If you buy a home without an agent or with a discount agent, how do you shop for title insurance?

Even if you work with full-commission (3%) agents, they just work with their favorite title insurance companies. They don’t comparison shop the best deal for you.

How do you find out the quality of service of a title insurance company? How do you find out all the fees that the title insurance will cost you?

Title insurance is to ensure that your home has a free and clear title and no one has a lien or a claim on it. It’s critical and requires professional expertise. You don’t want to do it yourself, and cannot afford to be self-insured. You don’t want to find out by surprise that your home isn’t yours after you’ve paid your down payment and all the closing costs. Title insurance ensures that this never happens, assuming that the insurance company does its job.
Is anyone familiar with the California laws? Is it always the seller’s agent who chooses the title insurance company? Do the laws require that all title insurance companies do pretty much the same things to check the title?

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barry0912 answers:

Title insurance is cut and dry so to speak,

im going thru a large claim on mine right now,
they are really terrible to deal with.
They all have to provide the same coverage, and service as required by the state,
the fees they charge are usually state regulated also, they all charge the state regulated amount, ( like Gap insurance for a car ) its always the same for everyone.
A trip to the register of deeds will save you the money, ( I wish I would have )
if its not on the record the title insurance wont cover it anyway.

I had an easement the title insurance didnt find, and now the easement holder came in and is doing as he wishes all over our property, tearing down trees, removing a building,

It was on record at the court house, and the title insurance still dosen’t want to pay.

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Charles asks…

Do attorneys issue and sell title insurance or simply buy it on behalf of their clients?

I understand that attorneys perform title searches and make a title judgment/title assessment. I also know that they would have to hold an insurance license in the state they are located, be backed by an insurance company(i.e. be an insurance broker/rep), or have an actual insurance company,but all of these are possible to do. What is the normal situation with real estate attorneys and title insurance?

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barry0912 answers:

The attorney has to be approved to do title opinions for title insurance companies. There are required classes and seminars and insurance the attorney must have before they are cleared to do the title check and opinion for the title insurance company. Then the title company issues the policy.

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Your Questions About Title Insurance

Mary asks…

What is the purpose of title insurance and why do you need it?

I recently bought property and received the title insurance policy in the mail but it doesent seem to cover anything after reading the exceptions.

barry0912 answers:

There is no absolutely right answer for your question.Nonetheless,explorer the information here http://www.InsuranceFreeTip.info/insurance-for-free.htm might give you some ideas.HOpe it helps.

John asks…

Do I need to buy Title Insurance for my condo? What is the risk?

I am buying a condo in a new development and paying cash for it. I understand that mortgage lenders require title insurance, but that isn’t an issue here. I understand that the insurance is there for peace of mind to protect the large investment, but I don’t understand what the risk is, especially since the other 110 new condo owners in the building are likely going to purchase title insurance at the requirement of their lender. The Title Insurance company wants to charge $820 for ALTA Owners Standard Coverage.

barry0912 answers:

I don’t know about new construction, but I too, bought my sisters home for cash and I didn’t do a title insurance….My attorney advised me against it, but I know she didn’t have any liens on the property…..When we went to sell it, the buyers needed title insurance, for they were getting a loan and it came out clean….But I knew my sister and I know she has impeccable credit! I have to agree with the person that said, you don’t know if the builder may not have paid everyone, other contractors, who may come back and placed a mechanic’s lien….I would recommend it for this property…..BUY the insurance, you don’t know who you are dealing with….it just makes sense…

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Your Questions About Title Insurance

Ruth asks…

Is a Title Insurance company responsible when they do not disclose an open permit?

To make it short and simple:

Refinancing a house now

An open permit from 1949 came up, can’t close with out resolving

House was purchased in 1978 and this “open permit” never came up. Title Insurance was issued @ purchase.

Can we hold Title Insurance Company responsible for this?

Thanks for your replies.

barry0912 answers:

Where did the issue of the “open permit” come from? Title searches involve property title history and encumbrances – not building permit issues.

Laura asks…

What does Title insurance cover and does it help me, the buyer?

I have started the prequal paper work, am determined to continue with researching a pre foreclosure home that I was told about by a friend, and am a bit nervous about how much I don’t know about buying real estate. I am told I will have to pay for title insurance to protect the lender. What does this policy cover, is it sufficient protection for me as well and how much does it cost?

barry0912 answers:

I can only add a little to what has already be said in other answers, and perhaps just put some of the same things said in a different light.
First up, Title Insurance is required by all lenders. Its their indemnity policy to protect them against loss.The fact that the insurer issues a policy to the lender who requires you to foot the bill indicates that the title has been searched. But no title search is 100% reliable.
Title insurance protects from claims arising prior to the date of the policy, coverage going back into time indefinitely, lasting as long as you or your heirs have any interest in the property. The home you are about to purchase could have changed hands a number of times and at any time there could have been fraud, fault, unpaid taxes that emerge later to cause trouble.
A very important point raised by others in their answers is that you need to get an owner’s title policy for the full value of the home. That’s because the lender’s policy doesn’t cover your equity, which hopefully will build in value over time. That’s what Bostonianinmo is referring to.
The cost of the obligatory lender’s policy varies from state to state because the services paid for vary. In some states the premium covers protection only and costs of search and title exam are covered separately. Each state has different regulatory regimes which affect the charges.
Check out the glossary on the site I have referenced as a source for specific foreclosure terminology.

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