Foote Title Group – Title Insurance
One of the things that a closing company does is they guarantee your ownership by giving you an insurance policy at your closing that’s called an Owners Title Insurance policy. This policy ensures that no one can ever come and make a claim and take away your ownership. This is so very important because the property you’re purchasing you think, “Wow I’ll own this wonderful a piece of property that I saved so long for … and of course the person that selling it to me actually owned the property and didn’t owe anyone other than who was actually paid off, that all of the information in the previous owners records is all clear and I’ll never have a problem with my ownership as long as I own this property”. So it’s not really something that you ever think about.
This is one of the reasons it’s so very important for you to actually make a choice on the company that does the closing for you because home closings are insured by the company that does that closing for you. If you’re working with a title company that isn’t reputable, doesn’t deal with an insurance company that backs them, that is a company that has high standards, and a good history for working with customer service, then you’re potentially going to have a problem with that with your ownership.
Why do I need insurance? You’re buying a piece of property and you’re spending an awful lot of money whether you’re borrowing the money to to buy that property, or you are borrowing some of it, all of it, or none of it you have an ownership interest. As you make your payments and pay down that mortgage your equity increases and you want to make sure that no one can come back and make any claim against that ownership and take that home away or you could lose your equity.
Coincidentally today I was actually listening to Les Brown who is an international motivational speaker and a positive mentor. Interestingly enough you very rarely hear the public talk about having issues where title insurance was something that they should have checked into before they bought a home. He was explaining a story about how when he was becoming successful his main goal and purpose in life was to buy his mom a home. His mom was very poor, adopted seven children raised them all on shoestring budget. They lived in a very poor neighborhood, bad situation, and he was going to buy his mom home. He was explaining how the first home he bought her he didn’t do his research and he didn’t explain the whole story, but basically he said that he didn’t check and make sure the title on the property was cleared. A previous came back after he purchased the home made an ownership claim and won they lost the home and had to move back where they came from. Les explained how devastated he was because he had bought his mom a home and got her out of the poverty situation that she was in and come to find out he didn’t do all of his research.
I bring this up because we insure the ownership to the property as do most title companies, but not always is the company that you’re doing your closing with or that’s doing the insurance for you a reputable company. So just like if somebody said to you, we will give you a 10-year warranty on your vehicle, or lifetime warranty on your vehicle, and that company goes out of business because they did something illegal, or couldn’t afford the same business because they didn’t do a good job managing their business, then that warranty you got means absolutely nothing. So the title insurance policy is very important and making sure your deal with a company that takes good care of you, has a good reputation, has been around for years and has a good reputation for clearing issues so you don’t run into a problem is crucial when making your choice Although title insurance protects you, you don’t want to have to use the insurance unless it’s a major issue.
Title insurance is the one and only insurance that there’s no deductible for after you purchase it. It covers you for things that happened in the past that could affect your ownership now. It’s based on the value of the home that you’re purchasing. The lender requires that you purchase the lender’s title insurance to cover their loan because they want to make sure their loan is secure. You will want the Owners Title Insurance to make sure your interest is covered today and for the rest of your ownership for things that happened in the past so if there was a problem with a previous seller and their ownership wasn’t properly documented and that needs to be addressed. Owners Title Insurance is an optional cost at closing but it is the owner insurance coverage that protects you and your investment that you worked so hard for.