For most people, their home is their largest investment, and they want to make sure that investment is as safe as money in an insured bank vault. So, in order to protect your investment in your home, the settlement agent will search local courthouse records to make
sure the seller can convey clear and marketable title to you. They look for judgments, tax liens, lawsuits, and other title problems – and make sure the transaction doesn’t close until everything is clear.
While a title search should uncover problems of record in the courthouse, and a survey should uncover matters on the ground that does not guarantee there won’t be title problems. For example, courthouse records will not reveal forgery, fraud, unknown heirs, lost wills, etc. For this reason, lenders require that their security interest in your house be protected with title insurance. Title insurance is just like any other type of insurance except that it insures against title problems.
The lender’s policy does not give YOU any protection. At closing, you will be given the opportunity to purchase an owner’s title insurance policy, which would protect YOU, for a reasonable one-time fee.
Questions on title insurance or anything else in the home buying process? Email us at concierge@lizmoore.com, we'd love to help! Or, click below to download our free Home Buyer's Handbook.
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