|
Protecting your Home Investment A home is usually the largest single investment any of us will ever make. When you purchase a home, you will purchase several types of insurance coverage to protect your home and personal property. Homeowner's insurance protects against loss from fire, theft, or wind damage. Flood insurance protects against rising water. And a unique coverage known as title insurance protects against hidden title hazards that may threaten your financial investment in your home.
Protecting Your Largest Single Investment Title insurance is not as well understood as other types of home insurance, but it is just as important. You see, when purchasing a home, instead of purchasing the actual building or land, you are really purchasing the title to the property - the right to occupy and use the space. That title may be limited by rights and claims asserted by others, which may limit your use and enjoyment of the property and even bring financial loss. Title insurance protects against these types of title hazards.
|
 |
|
Other types of insurance that protect your home focus on possible future events and charge an annual premium. On the other hand, title insurance protects against loss from hazards and defects that already exist in the title and is purchased with a one-time premium.
Two Kinds of Title Insurance benefit You in Two Ways There are two basic kinds of title insurance:
Mortgagee title insurance is required by most lenders as security for their investment in real estate, just as they may call for fire insurance and other types of coverage as investor protection. When title insurance is provided, lenders are willing to make mortgage money available in distant locales where they know little about the market. |
|
Owner's title insurance lasts as long as you, the policyholder - or your heirs - has an interest in the insured property. This may even be after you have sold the property. For a one-time premium, collected at closing, the Owner's Title Insurance Policy will remain in effect as long as the insured, or the insured's heirs, retain an interest in the property. Owner's title insurance will not only protect you against hidden risks that would not be disclosed by even the most meticulous search of public records, but will also pay for the legal fees required to defend your title against these hidden risks:
|
ALTA Enhanced Title Policies also includes protection against such additional defects as:
|