Title Insurance

Title Insurance is a insurance policy that protects the owners of the residential and commercial property owners and lenders against the losses related to the property title. It provides coverage for the title related risks associated with real estate transactions

Title-related risks insured by title insurance include:

1. Unknown defects in title ie., any defects that prevents you from having clear title to the property;

2. Compliance risks, such as non-compliance with restrictive covenants, the existence of major encroachments;

3. Any liens against the property title, for eg. Unpaid debt from utilities, mortgages, property taxes or condo fees secured against the property.

4. Title frauds

5. Any other title related issues that prevent a homeowner from selling, mortgaging or leasing the property.

There are two types of title insurance policies:

1. Lender Policy- provides coverage’s for the amount of the property’s mortgages

2. Owner Policy-sets out the maximum coverage for various title related losses set out in the policy for the owner of the property.

For a onetime fee called premium, title insurance will protect the home owner as long as he/she own the property and will cover losses to the maximum coverage as set out in the policy.

The premium is based on the value of the property and the choice of the title insurance company. The title insurance policy is usually purchased when you buy the property.