The Sneaky Title Defects That Could Threaten Your Home Ownership
The real estate market is one of the backbones of the American economy, but every transaction is vulnerable to some level of risk. This is why title insurance has existed for more than 125 years to protect home buyers and lenders alike.
Title insurance is a simple insurance policy that exists in two forms. If you are the buyer of a real estate property, title insurance protects your investment in the unlikely scenario that a title defect is discovered after your sale. Title insurance also covers the institution providing the buyer’s mortgage loan for the same reason.
Most home buyers are surprised to learn that the title of their home might not be free and clear. The following three title defects are a few of the problems that could threaten your newly purchased home without title insurance.
Unknown Liens
Lien is a claim that can be placed on a home in response to money owed by the homeowners. It serves as a legal notice that the home cannot be sold until the debt is resolved. Mortgage companies don’t offer financing until all liens are cleared from a property. Liens are typically uncovered before a home is sold, but it’s possible for an unknown lien to be discovered after you’ve already purchased your new dream home. Without title insurance, you would risk losing your home due to a lien you never caused.
Missing Heirs
Property is commonly passed from family member to family member as older relatives name their children and grandchildren as heirs to their homes and estates. However, some heirs are missing or unknown for months or years after a home is passed down to them. In other situations, family members may contest the will and their rights to the property. These issues may occur without your knowledge at all, until an unknown heir suddenly knocks on your door and demands the property back. Only title insurance can protect you from this type of risk.
False Impersonation of Previous Owner
It sounds crazy to buy or sell an entire house on a fake identity, but many criminals take advantage of their common and similar names to impersonate a property owner and sell a property that actually doesn’t belong to them. If you become a victim of this scam, you risk losing your legal claim to the property without title insurance to back you up.
The importance of title insurance before any real estate purchase cannot be overstated, which is exactly why Benefit Title Services, LLC is here to provide expert title services that protect your rights to your new home. Call (813) 251-1420 to learn more.
