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Henry Jackson
Henry Jackson

Buying Title Insurance After Closing


A title search is conducted during the closing process in order to ensure that all records related to the property, as well as debts guaranteed by the property, have been properly prepared, satisfied, and recorded. A title report is subsequently prepared and issued to outline the resulting findings.




buying title insurance after closing



Yes, you can buy title insurance after closing, but this option has risks attached to it. Should a new issue arise that was not identified in the title search prior to closing, you may be hard pressed to buy title insurance after closing.


If you are lucky enough to pay cash for your home, you will not be required to pay the mandatory lenders title insurance, since there is no mortgage or lender involved. In addition, you will save on closing costs since many of them are related to the acquisition of a mortgage.


In many cases you will still want to purchase a title insurance policy to protect your stake in the home, especially since you have the most to lose from a discrepancy in title and the resulting legal issues that arise.


In most markets, the seller pays the cost of title insurance. This is a way of reassuring the buyer and their lender that purchase of the home -- as well as any subsequent work, loans, liens, or other financial transactions related to the home -- were properly paid and handled by the seller, and that the buyer will have a clear right to the property.


Titles and deeds do not protect you from unknown claims or encumbrances. Therefore, many people choose to secure title insurance. While not mandatory, purchasing a title insurance policy covers past title problems that arise after you buy or refinance a home. Often, these issues are unknown at the time of purchase. Referred to as title defects, these may include:


When searching for a title company, choose one that combines their title products with a variety of settlement services. Settlement services include scheduling a closing date, preparing and processing your closing package documents, the disbursement of funds, and more.


381.075. Additional insurance laws applicable to title insurers, insurer's supervision, rehabilitation and liquidation act, exceptions--liquidation or insolvency, treatment of security and escrow funds, filing of claims, cancellation of policies, payment of fully earned premiums.


The closing process for a real estate purchase begins when the contract and any earnest money are delivered to First Texas Title. The contract provides a blueprint for the closing and governs the issues that may arise as part of the closing. On refinances, the process is typically initiated when the lender submits an order for a title commitment.


The contract provides directions to First Texas Title for how to prepare for the closing and governs the issues that may arise as part of the closing. On refinances or loan transactions, the process is typically initiated when the lender submits an order for a title commitment.


If Schedule C of the title commitment has revealed a title issue that must be addressed prior to closing, or if Schedule A shows that your seller does not own the property, then your seller should be using this time to cure those issues. Depending on the nature of the title problem, the cure could include anything from obtaining and recording correction documents or missing documents from prior transactions to probating the last will and testament of a previous owner.


Once the inspections are completed and the title requirements are resolved, the buyer, seller and/or lender can contact First Texas Title to schedule a closing date and time. Several days prior to the real estate closing, we will prepare the documents necessary to close the transaction. For cash transactions, there may only be a handful of documents necessary to close. However, when there is a loan involved, the number of documents required to close the transaction can increase significantly. Please note that if a lender is involved, we cannot prepare any of the closing documents until we receive closing instructions and documentation from the lender. The documentation related to a loan varies greatly depending on the lender and the type of loan you are obtaining.


Title insurance in Abilene, Texas, and other cities is a contract of indemnity between the insured and the title insurance company. Title insurance represents the judgment of the title company as to the insurability of the title and may, in the event title is challenged, provide certain remedies for the insured. Title insurance is not a representation or warranty as to title.


Why do I need title insurance?Title insurance in Abilene, Texas, offers two distinct types of protection for your residential or business property. First, the basis of title insurance is an examination of the public records. In our title examination in Abilene, Texas, we will identify all kinds of information about the property to be purchased, including the existence of any potential defect in the title. Defects can range from a lien against the property held by a lender or a governmental agency to a competing claim of ownership of the property. A recent study by the American Land Title Association revealed that in 36 percent of all real estate transactions a problem or defect in the title was discovered through the title examination process. The research and corrective work of First Texas Title can dramatically reduce the likelihood that someone will make a claim against your title. The second type of protection comes after the sale when title insurance can offer coverage for certain defects in the title that may arise and were not identified and addressed by the title company.


Who underwrites title insurance?First Texas Title is an exclusive agent of First American Title Company. First American Title Company is a division of The First American Corporation, a Fortune 500 company and the global leader in the provision of real estate and business information services. Learn more about The First American Corporation by clicking here. What this means for you is that instead of relying on First Texas Title or on attorneys to be here if you have a title problem 10 years from now, you have the backing of one of the largest and most well established companies in the country.


Once the company completes the search, it assesses any issues, as well as potentially previously undiscovered ones, and then offers a quote for a title insurance policy based on those risks. If a title has many defects, the company might decline to offer a policy.


The purpose of title insurance is to protect your ownership in the home. If somebody later claims to have some sort of interest in the home, such as a lien, easement or other claim, the title insurance company would be responsible to pay to clear your title to the property.


On the other hand, if you transfer the home with a quit claim deed, all you are saying is that you are giving any interest you have in the home to the buyer. And you may have nothing. Because of this, you should generally never accept a quit claim deed from the seller when you are purchasing property. Since you are not giving a warranty of title on a quit claim deed when using one to transfer your home to your trust, you may no longer have the protection of your title insurance policy.


You typically receive your title insurance policy in a letter-size envelope. It is usually five to seven 8-by-11 pages stapled together. The policy usually has at least four pre-printed pages and two or three schedule pages. The pre-printed pages generally include standard policy provisions. These pre-printed pages are sometimes called the policy jacket. On the schedule pages is printed information regarding your home with, among other things, the legal description of your home and how it is titled, along with a listing of any liens, easements, restrictions or reservations of record.


When you receive your title insurance policy, review it to make sure that your name is spelled correctly and that the legal description is correct. We have seen on more than one occasion where names are wrong or the legal description is wrong on the title insurance policy. It is a whole lot quicker and easier to make changes to the policy immediately after the purchase, when you are alive and well, than when you are not.


We had one case in which a couple thought they owned their home in which they were living for the past 20 years. Both their deed and their title insurance policy named someone else who tried to purchase the home before them, but the sale fell through. The deed was never changed when they closed on their home, which they purchased for cash after downsizing. It cost the title company more than $5,000 in legal fees to put the home into their names.


Without your title insurance policy, you are on your own. If something comes up in the future and somebody files a claim against the property, such as a lien, easement or encroachment, without a title insurance policy you may be liable to foot the bill personally for all the legal fees or other costs that are necessary to make sure that the title to your home is clear.


If you cannot find your title insurance policy and know that one was paid for, you can request a duplicate replacement policy from the title insurance company. If you have no idea who the title insurance company was, maybe you can get that information from the closing agent, real estate agent or the title agency.


In order to protect you and your assets, you should have an original title insurance policy for every parcel of real estate you currently own or have sold within the past 15 years. If you do not have a copy of the policy and know the name of the title insurance company that issued the policy, request a duplicate policy. If the title company refuses to issue a replacement policy, the Michigan Department of Insurance and Financial Services recommends that you file a complaint with them. The complaint form can be found at _ofis_comp_all_25074_7.pdf. 041b061a72


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