Three Reasons Not to Skip on Title Insurance

There are a lot of small expenses when you are trying to purchase a home. Most home buyers are not aware of all the little costs that add up upon closing. One of the things that you need to prepare for is title insurance. You might be tempted to skip this expense, but that would be a mistake. Here are three reasons not to skip on title insurance.

Your Lender Requires It

Most lenders require that you have title insurance in order to get your mortgage. This lender’s policy covers the legal expenses of the lender in case a title defect arises. It will also pay off what you owe on the mortgage, but you’ll lose the money you already paid up to that point. Your buyer’s policy will cover your own financial losses in case you have to give up the property for some reason.

You Never Know

Even the person selling you the house might believe that they have a free and clear title, but situations do occasionally arise. Someone might have gotten the house through a will that was outdated, and someone else should actually own the property. Someone might have been married or otherwise co-owned the property and not gotten the sale signed off by them. Other similar situations can happen. It is best to be prepared with title insurance to protect yourself.

Liens

Title insurance also protects you against liens. While most liens will come up in the title search and be addressed with the seller before or at the time of closing, some liens may not first come up in a title search. If you purchase a home with the liens still attached, you’ll have to pay those liens to do anything with the property. Title insurance covers those costs.

If you are buying a home and want to make sure you have the best title insurance policies, contact us today for more information or to get started.