Your title insurance ensures that the seller has the legal right to sell the property you’re buying. Title insurance is purchased to ensure that the property title is free of previous faults that could jeopardize the ownership of the real estate. When it comes to ensuring the title, keep in mind that there are two forms of title insurance: lender’s title insurance and owner’s title insurance.
Let us discuss in detail below:
- A lender’s title policy
It’s usually paid for by the buyer, although in some regions, it’s paid for by the seller following local custom. It is not required to have an owner’s title policy. This safeguards your property investment, but you can do without it at your own risk. Let’s dig a little deeper into these. Lender’s title insurance is designed to safeguard the mortgage lender if there is a problem with the title down the road that leads you to lose your home. This is required by mortgage firms since the insurance coverage protects the loan amount if something goes wrong.
- Owner’s Title Insurance Policy
Unlike a lender’s title policy, an owner’s title policy protects the equity you’ve built up over the months or years you’ve lived in your house. Let’s imagine someone files a claim against your property and proves that the seller who transferred the property to you lacked the authorization to do so. You’d still have to move out, but the owner’s title policy would provide you with the funds to purchase a new property worth the same amount as your old one.
At Bronson Abstract Company, Inc. we create a preliminary report in the form of an insurance ‘promise.’ This report indicates the current ownership status as well as any encumbrances, giving all parties a contractual stake in the transaction critical information. To ensure a trouble-free ownership experience, our knowledgeable staff will advise you on which restrictions must be eliminated before closing in areas like Bentonville, Rogers, AR, Springdale, Bella Vista, AR, and Fayetteville, AR