What is owner's title insurance?
Most people in their life times will go on to buy a house of their own but there is a lot you need to know when it comes to being a first time home owner. One of the most important ones you will need to know is the owner's title insurance & where to find the one that is right for you. So just what is this concept & why is it so important for you to have it when you buy a home of your own? In this article, we will explore all you need to know about this & more.
The owner's title insurance gives you protection if someone sues you or says they possess some sort of claim against the house that occurred long before the previous owner bought it. You see, when you first buy a home, you will be handed the deed to the property & this is how you verify your ownership of the house. So if someone says they have a right to the property instead and sues you for possession of the house, this will help you to insure you do not lose it. This can be anything from taxes that were not paid on the house or contractors who claim they were not compensated for work they did on the house before you bought the property. Of course, these are just 2 examples & there are a lot of other reasons why someone might sue but you get the idea.
Now when you purchase homes, most lenders will mandate you buying what's known as a lender title insurance policy & this will help insure any money they may lend to you. If you get this policy, it will also help protect however much you have invested in your new house. So if you are looking to get one of these, you can usually peruse the internet for a title insurance provider & this will remain separate from however many mortgages you may need to take out on the house.
By seeing all the different sites & what they have to offer, you can save a lot of money when deciding which one to buy. But just keep in mind that if you use the same provider for both the lender and owner's policy, it is usually cheaper than if you use different providers. But you should definitely do your own home work before you make a decision one way or the other. This will help to ensure that you get the best deal possible as you begin to settle in to your new home.
One other thing to keep in mind is that home owner laws tend to vary from one state to the next so you want to make sure that you are up to date on all of those laws before you make any decisions in regards to your insurance policies. In some states, they will give you a whole list of different fees so you know exactly what you are paying for and how much each item costs. This usually happens right after you close the deal. It's important to note that the fee list might be different from the loan estimate you get but this does not necessarily mean that they are charging you more than it's worth.
You may also get a closing disclosure which is a 5 page form that gives you all the details you need to know about your mortgage loan. It also includes the terms of this loan as well as how much you will pay per month to pay off the loan. It will also tell you all need to know about other costs associated with your mortgage known as a closing cost. This is all based on the loan estimate and closing disclosure forms that were first implemented back in 2015.
So do you actually need title insurance? Well, there is no guarantee that you will ever get sued so it is not something you necessarily need. However, it is recommended as you never know what may happen down the line. But just remember: it's important to know what you're getting yourself into before you make any purchases or investments.
