Title Insurance – the BASICS
A title legitimizes your ownership rights in a property. If the title is free of any blemishes, it’s considered a “clear title.” If inconsistencies or other problems are found, the title may be deemed defective.
Before you buy any real estate, it is imperative that you have a thorough title examination performed. This will allow you to confirm you are buying a property that has a clear title that can be conveyed without difficulty.
A title examination also reveals the history of ownership (known as the “chain of title”) for the property. Each time a Florida property is sold, the purchase is recorded as public record in the county court. The chain of title will reflect every time the property was bought or sold.
There are several ways a title to a property can be transferred. Most often, a written deed is used to change ownership from one person to another. Other ways a transfer can take place is through inheritance, a court order, and a will.
Title insurance is an insurance policy that protects the real estate buyer and the mortgage holder against loss caused by defective titles, liens, or encumbrances. Most mortgage lenders in the United States require the buyer to purchase a title insurance policy that will protect the lender’s interests in real estate loans. A title insurance policy will cover the property indefinitely – until the ownership changes.
Title insurance protects both the property buyer and lender from liabilities that can stem from a defective title. However, federal law – specifically the Real Estate Settlement Procedures Act (RESPA) – establishes that the buyer has a legal right to pick a company to insure the title.
Our firms real estate section routinely provide title examination and title insurance for residential and commercial clients. This includes an extensive search of the public records to confirm there are no adverse claims or other defects in the property’s title. We offer a variety of real estate services.