Should You Buy Title Insurance?

Title insurance. A purchase that is truly a no-brainer from the eyes of a lawyer, but I understand where my clients are coming from when they ask "but what's the catch?" I knew the day would come when I would have to write a blog about this, so here it goes.

As you embark on the journey of purchasing a home, it's essential to safeguard your investment against unforeseen legal issues that could arise with the property's title. One crucial aspect of this protection is obtaining title insurance, and here are four compelling reasons why every purchaser of residential real estate should acquire title insurance:

1. Defending Against Hidden Defects: When you purchase a property, you want assurance that you are acquiring clear and marketable title. However, there could be hidden defects in the title that may not surface during the initial examination. These defects could include undisclosed heirs, forged documents, or unresolved liens. Without title insurance, you could find yourself facing legal battles and financial losses to rectify these issues. For instance, imagine purchasing a home only to discover later that there is a lien on the property due to unpaid taxes by the previous owner. Title insurance would cover the costs associated with resolving this issue, protecting your investment.

2. Safeguarding Against Fraudulent Claims: In today's digital age, real estate fraud is a prevalent threat. Fraudulent schemes can involve forged deeds, unauthorized property transfers, or identity theft. Without title insurance, you may be left vulnerable to these fraudulent claims, risking the loss of your property and financial damages. For example, consider a scenario where an individual fraudulently sells a property they do not own. With title insurance, you would have the necessary protection to defend against such fraudulent claims and preserve your ownership rights.

3. Ensuring Peace of Mind: Purchasing a home is one of the most significant investments you'll make in your lifetime. Title insurance provides peace of mind by mitigating the risks associated with title defects. Knowing that your investment is protected against unforeseen legal challenges allows you to focus on enjoying your new home rather than worrying about potential title issues. Whether it's a boundary dispute or an overlooked easement, title insurance provides the assurance that you are safeguarded against these uncertainties.

4. Facilitating Smooth Real Estate Transactions: Title insurance plays a crucial role in facilitating smooth and efficient real estate transactions. Lenders often require title insurance to protect their interests in the property. By obtaining title insurance upfront, you demonstrate to lenders and sellers that you are a responsible and prepared buyer, which can expedite the closing process. Additionally, title insurance provides reassurance to all parties involved in the transaction, fostering trust and confidence in the deal's legitimacy.

In conclusion, I strongly recommend you obtain title insurance in your purchase. For my clients who choose to proceed without title insurance, I happily continue as they wish; however, I have them sign consent forms acknowledging that they have been told about the benefits of title insurance and have willingly chosen to not obtain it. For my fellow lawyers out there- I strongly encourage that you implement the same practice.

As always, please feel free to reach out to the firm if you require any further information or assistance. We are always one call away.