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Posts Tagged ‘Homeowner’s title insurance’

Purchasing Home Owner’s Title Insurance always was and still is OPTIONAL. There is no law that requires homebuyer to purchase a Title Insurance – although the same homebuyer MUST purchase Lender’s Title Insurance that protects the lender’s investment in the property and is required by all lenders.

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However, in the post 2005 years that brought the flood of short sales and foreclosures, purchasing a Homeowner’s Title Insurance is a wise decision – not purchasing the insurance may prove to be a costly mistake.

Homeowner’s Title Insurance is a one-time payment on the Settlement day.

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Merely purchasing the Title Insurance is NOT sufficient. Homeowners need to store the copy of the Insurance in a very safe place where they can find it easily when the need arises. Unfortunately, the Title Company insuring the title will require the policy number and the date the title was purchased before they will pay for any damages caused by the clouded title.

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Clouds in title can be caused by unrecorded deeds, liens, illegal passing of title, defects in foreclosure proceedings, etc.

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Typically, title companies conduct a 60 year back title search to verify the chain of ownership. However, occasionally errors do happen and can lead to costly problems for homeowners.

Just like the Auto Insurance follows the car and not the person driving the car, the Homeowner’s Title Insurance follows the house, not the person who clouded the title.

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In the current environment of short sales and foreclosures, declining to purchase the Homeowner’s Title Insurance is simply too risky.  If you love your home and want to keep it, protect your investment with home owner’s TITLE Insurance – it is one time payment on the settlement day.  Chances are you will be glad you did.

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