The Dangers of Not Having Title Insurance
When you are going through the process of selling your home, there are a lot of little things that need your attention. It can seem as though the to-do list is never going to be completed. One of those small things is title insurance. There are a lot of reasons that a buyer wants to have title insurance. There are risks for both the buyer and the seller when you skip on the title insurance.
Title Defects Affect Closing
Title defects can affect the closing of a sale on a home. Title defects can be anything ranging from:
- Back property taxes being owed on the property
- Unrecorded liens
- Unrecorded access rights
Homes that have been in foreclosure are the most likely to have title defects. When a real estate agent sells a home, it is their responsibility to make sure that the property does not have any outstanding liens, back property taxes, or other title defects. If a home is sold for sale by owner, you have that same responsibility. Title insurance backs up this responsibility with compensation if any defects become known.
What Title Insurance Does
Title insurance protects buyers and lenders from titles with defects. If, for example, back property taxes come to light after the purchase, the title insurance pays for those taxes instead of the buyer being responsible. These same types of defects are also covered for the lender in case the buyer defaults on the mortgage and the lender must dispose of the property.
Title insurance does something for the seller as well—it gives you peace of mind. Without title insurance, any title defects that come up after the sale could be held by courts to be your responsibility. Title insurance protects you by paying these claims for you if they should arise.
If you are selling your home and are in need of title insurance, we can help. Contact us today for more information or to get started.
