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10 Reasons to Request a Homeowners

Policy of Title Insurance

Homeowners Policy of Title Insurance Covers

• Against defects in the title to your property including unrecorded easements, forgeries,or other undisclosed contract issues.

• Against loss due to unknown encumbrances on your title such as liens, judgments, tax liens, or security instruments.

• Against title claims as a result of fraud, incompetence, or incapacity of the party conveying the property.

• Against lack of legal access to the property.

• Loss due to a violation of subdivision law or regulation which effect your ability to obtain a building permit, correct or remove
the violation, or remove any existing structures in violation (subject to the policy deductibles).

• Loss if you are forced to remove structures because they encroach on your neighbor’s property, over an easement or
building set-back line.

• Loss should your existing improvements, to include lawns, shrubbery or trees are damaged due to future exercise of a
right of use for the surface of the land for minerals, water or any other substance.

• Loss if a taxing authority assesses supplemental real estate taxes not previously assessed against the property prior to
the policy date.

• Loss in the event the address of the residence purchased is not the same as shown on the final title policy.

• Loss if the title to the property is unmarketable which allows another party not to perform on a purchase contract to purchase
the land, lease it, or make a mortgage loan on it.

Example:

Donald is buying a home directly from an honest, reputable
friend. The Title Commitment, which he orders, gives no
evidence of title problems, so Donald decides not to waste
any money on title insurance.

Donald’s friend may be honest and may have told Donald
everything he knows about the home, but what about
the previous owners? Did they have a valid claim to the
property?

Many kinds of title defects are so serious that they can render
a title unmarketable. It is the title insurance you purchase
when you acquire real property that protects you against
most of these defects.

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