Title Insurance

About Title Insurance

What is title insurance in real estate?

When you buy a home, you are given a title to the property, which generally means you receive full legal ownership. Sometimes, there is a hidden mistake in a prior deed, will, mortgage, etc., that may give someone else a valid legal claim against your property!

For new homebuyers, title insurance protects against loss if a covered defect is found in the title to your home. It offers you information on the status of the title to land before you buy or refinance and protects against title claims that may affect the title after you buy. Having title insurance can save you money, time, trouble, even your home!


How does title insurance work?

According to the American Land Title Association, title companies find and fix problems with the title in 25% of transactions - usually without the the borrower or lender even knowing it! In addition, title companies pay millions of dollars each year in claims. Title insurance provides significant value to lenders and homeowners.

Before closing, Realty Title searches the public records for all matters affecting title. The search entails examining the records in the offices of the Register of Deeds, Clerk of Courts, and other municipal and county officials. These records include recorded documents, judgments, liens, taxes, street easements, sewer assessments, special taxes and other matters that could affect property ownership.

Through careful examination of these records, we determine who owns the property and what interests may already exist in that property. This process, called a title search, provides early warnings of title flaws that must be dealt with before the property can be sold or refinanced.

In those transactions where title insurance is involved, the title company must determine insurability of the title as part of the search process. This leads to the issuance of a title policy, which insures the existence or non-existence of rights to the property.

The title insurance company will, at its own expense, defend the title and will pay losses within the coverage of the policy if they occur.


How does title insurance differ from other types of insurance?

Title insurance is substantially different from other types of insurance coverage. Title insurance emphasizes risk prevention rather than risk assumption, so the coverage offers the best possible opportunity to avoid claims and losses in real estate transactions.

Because of the important corrective work that title professionals perform, it is rare for lenders or homeowners to suffer a loss under their title insurance policy.

The majority of the title insurance premium goes toward the exhaustive research and due diligence work done by Realty Title upfront, while a small percentage goes toward the payment of claims.

Title insurance is charged only once at closing, where other forms of insurance typically require monthly or quarterly payments.


Types of Title Insurance

  1. The Lender's Policy

    There are two types of title insurance: Lender's title insurance and Owner's title insurance. Most lenders require a loan policy when they issue you a loan. The loan policy is usually based on the dollar amount of your loan. It protects their investment (the mortgage) and protects them against loss should a title problem arise. The policy amount decreases each year and eventually decreases as the loan is paid off.

    Lender's title insurance only protects the lender. It does not protect the owner. (FAQ - Doesn't the lender's title insurance protect the homeowner?) No. A lender's policy protects only the lender's interest in the property should a problem arise. It does not cover the owner's equity in the property, and will not pay the homeowner's legal expenses if there's a title problem. Only an owner's title insurance policy will protect the homeowner.
     
  2. The Owner's Policy

    Owner's title insurance is usually issued for the amount of the real estate purchase. You pay a one-time fee at closing and lasts as long as you or your heirs have an interest in the property. This may be even after you have sold the property. Only an owner's title insurance policy fully protects the homeowner should a title problem arise that was not uncovered during the title search. An owner's policy can also protect you by paying for any legal fees involved in defending a claim to your title.

    What does an owner's policy provide?

    • Protection from financial loss due to claims against the title to your home, up to the face amount of the title policy.
    • Payment of legal costs if the title insurer has to defend your title against a covered claim.
    • Payment of successful claims against the title to your home covered by the policy, up to the face amount of the policy.

ALTA Brochure

Download ALTA's Brochure - Ask About Title Insurance? (PDF File - 464 KB) - Explanation of what a title search is, what an owner's policy is and due diligence in the title search.

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Testimonials

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Dear Realty Title, I just wanted to let you know what exceptional service received each
and every time I have closed with Cheri Bayer at Realty Title. I just recently had a very difficult contract to close and Cheri helped me through it every step of the way. I will even go as
far to say that it may not have closed without all her hard work. She got my clients
to the table and made it as pleasant as possible. I will continue to use Realty Title
because of Cheri. She is just wonderful!

Julie,

Crye-Leike Mt. Juliet Agent

I have been using Realty Title for 17 years and I am never disappointed!! I know my clients will be taken care of and the job gets done on time!! It's nice to know there is a Title Company that goes above and beyond every time!! Keep up the good work!!

Sherry Hulen,

Crye-Leike

The customer service at Realty Title is AWESOME! They are all so kind, very knowledgeable and willing to help with anything! I thoroughly enjoy working with all of them at my closings! They make them smooth and enjoyable for all involved!

Stephanie Fowler,

Crye-Leike

Realty Title has always exceeded my expectation and ensured that the Closing Package was ready early along with the Wiring Instructions. It's great to always have laughs and smiles with happy clients closing on time - hassle free! Thank you!

Jason Bailey,

Mortgage Investors Group

My experience with Realty title was by far better than I could have imagined. The process was seamless and stress free. I want to bring special recognition to Deanna Wood, our closing agent. She was fabulous to work with, and got our closing scheduled 2 days after I was approved. Customer service like this shows shows the strength of the company, and ensures that I will do business with Realty title again. Thank you for the great experience!

Brittany Threet,

Zander Insurance Group

I don't know how I would have come out of [the closing process] sane without you.

Catherine R.,

Client

Your Realty Title Experience: Peeps always strive to perform regardless of the circumstances. They work hard!

Harold Whittaker,

Crye-Leike