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There are two types of title insurance and both are designed to protect against losses arising through defects in title to real estate. The title insurance company agrees to provide the policy holder a legal defense if a claim against clear title arises.

1. Owner’s title insurance protects purchasers of real estate against title defects that may exist against the property.
2. Lender’s, or mortgagee’s, title insurance insures the lender as to the priority of its mortgage lien, protecting against other mortgages, liens, or judgments recorded prior to their mortgage.

There are a number of defects that a title insurance policy may protect against, some a matter of public record and some hidden, such as:

• False Affidavits
• Forgeries
• Improperly Indexed Documents
• Judgments
• Liens
• Missing or unknown heirs
• Unpaid taxes
• Unsatisfied mortgages

A title commitment is a precursor to a title insurance policy in that it discloses the current ownership, easements, restrictions and liens relating to a particular property or its owner, and what documents or other measures must be taken to assure a clean title.

Owner’s title insurance is never mandatory, but it would be foolhardy to purchase real estate without the protection title insurance affords.  A real estate acquisition is often a family’s most significant asset.  A claim against their title could render that investment worthless or severely limit use of the property.

A title insurance policy protects against documents that do not appear in the public records, such as prior deeds, liens, judgments, or documents that were missed by the title examiner.  Title insurance may also protect against encroachments that do not appear on a survey of the property

A title insurance policy does not cover defects that occur after the property is purchased. Policies often exclude easements, mineral and air rights.  Whenever a buyer or seller is concerned, they can always feel free to ask us for an explanation of all exceptions and how it may impact them.

Lenders will always require title insurance to protect their interest in the property. It is up to the purchaser to protect their own interests by obtaining owner’s title insurance.

Title Insurance premiums are promulgated by the State of Florida. Title insurance policies are paid in-full with a one-time fee which is part of closing costs.

Generally, local customs in the county in which the property is located determine who pays for title insurance and other closing costs, although it is negotiable between the parties in a purchase transaction. The responsibility is usually addressed in the contract for sale and purchase.

A lender’s policy is usually issued for the amount of the mortgage. It pays the lender if a problem surfaces.

An owner’s policy covers the property’s full sales price and insures the owner against loss, including providing legal and investigative funds to resolve an issue.

Many buyers take advantage of the title insurance contacts their realtor or mortgage broker have cultivated. We pride ourselves in working closely with numerous real estate agents, mortgage brokers and other lenders to assure a smooth and pleasant buying or refinancing experience.

Contact us for more information regarding title insurance.