Title Insurance

Title refers to the rights of ownership and possession of a particular property. Before title can be sold to someone else, it must be marketable - free and clear of liens or other title defects that would be unacceptable to a prudent Buyer in the course of a customary real estate transaction.

To ensure marketable title, your real estate attorney can conduct a title search - an examination of the public records concerning the property you intend to buy. This generally includes mapping a chain of title to determine if the present owner received valid title from the prior owner and the prior owner received valid title from that title owner, right on down the line. A title search should uncover any identifiable problems or defects with the title you are intending to acquire.

Not all title defects are part of the public record. Such hidden defects may not be found in the course of a title search. This is where title insurance comes into play. Title insurance protects you against problems with the title that you didn't know about when you bought your property. If a problem is discovered, your title insurance company pays the costs to defend your ownership in court, to fix the problem, or covers your financial loss if the defects cannot be fixed.

You purchase your owner's title insurance policy when you close on the property you are buying. The premium (cost) for title insurance is paid only once at closing but the protection of this policy continues even after you sell the property that you had insured.