Why do I need title insurance?
It is certainly an understatement to say that purchasing your home is an important decision. But how do you know that the property you purchase has a clear title? This is where title insurance comes in and why it is so important.

Is it REALLY necessary for me to have this type of insurance?
Some kinds of insurance, you can buy or pass up. Some you don’t have a choice. One of those is title insurance, which your mortgage lender will require when you buy or refinance a home.

What specifically is this insurance protecting me from?
Title insurance protects you and your lender if someone challenges your title to your property because of title defects that were unknown when you bought the policy.

Possible hidden title problems can include: • Errors or omissions in deeds • Mistakes in examining records • Forgery • Undisclosed heirs   • Liens for unpaid taxes • Liens by contractors

 By getting title insurance, you are assured the property title is free from the problems of hidden liens and claims.

What actually happens when I get this insurance to assure my property is free and clear of title problems?
Public records for the property are searched to find problems in the title's ownership and history.Title searches start with the most recent deed, searching the grantee's name (the person now holding title) backwards in time, until the deed when the grantee acquired the property is located. That grantor's name is then searched backwards in time in the grantee's book to find when the grantor acquired title as a grantee. This process continues, and over time, the property description involves larger and larger parcels of land. Eventually, the searcher finds the U. S. Patent.

Are there different types of title insurance?
Depending on the title company, consumers can choose among a variety of options, but the top three choices are Owners, Lender's and Extended Coverage.

Basic Owner's Title Policy Coverage: 1. Clear title to the property 2. Incorrect signatures on documents 3. Forgery, fraud 4. Defective recordation 5. Restrictive covenants 6. Encumbrances or judgments

Basic Lender's Title Policy Coverage: 1. Mechanic's liens and unrecorded liens 2. Unrecorded easements and access rights 3. Defects and other unrecorded documents Extended Owner's Coverage 1. Building permit violations from previous owners 2. Subdivision maps 3. Covenant violations from previous owners 4. Living trusts 5. Structure damage from mineral extractions 6. Variety of encroachments and forgeries after title insurance is issued

The fee for title insurance is usually included in the itemization of closing costs from the lender and is a one-time fee.

Who Pays For Title Policy Insurance?
This depends on your local custom.
It can differ from county to county, but it is also negotiable in the purchase offer. 
In North Texas, the Seller typically pays to pass his property to the new buyer with clear title.

How Long Are Title Policies Good For?
Forever, theoretically. If you are planning to resell the property within a couple years, ask your title company about "binder" coverage. Most companies will sell you a binder policy for 10% more. A binder is good for two years, often can be extended beyond that time, and the fee charged for the new buyer's policy will be the difference between what you bought the property for and the price at which it sold. In other words, you will get a credit for the amount of coverage you purchased under your own Owner's Title policy.

How Often Are Title Policy Insurance Premiums Paid?
Once. The fee is due when you buy. You will never pay it again. Title policy insurance is the best insurance policy you can ever buy.

Additional Tips:

• Make sure the title policy amount is for the full value of the property
• Check to see that the policy date matches the closing date of the escrow
• The policy must describe all of the property and interests you are purchasing
• Many title insurers offer a discount when both a lender and an owner policy are purchased at the same time
• Ask you title insurer if you qualify for other discounts
• Make sure the company you select meets your standards and those of your lender