1.  It protects your ownership right to your home both from fraudulent claims against your ownership and from mistakes made in earlier sales, such as mistake in the spelling of a person’s name or an inaccurate description of the property.

2.  It’s a one-time cost usually based on the price of the property.

3.  It’s usually paid for by the sellers.

4.  There are both lender titles policies, which protect the lender, and owner title policies, which protect you.  The lender will probably require a lender policy.

5.  Discounts on premiums are sometimes available if the home has been bought within only a few years since not as much work is required to check the title.  Ask the title company if this discount is available.

Reprinted from REALTOR Magazine Online by permission of the National Association of REALTORS. Copyright 2005. All rights reserved.

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First American Title Insurance Company has a great answer to those questions!

A title insurance policy is an insured statement of the condition of title, or ownership of real property.  Prior to the issuance of a policy, a title report or commitment is prepared after a search of records, maps and documents affecting the parcel in question.  For a one-time premium, the policy protects the named insured against title defects, liens and encumbrances existing as of the date of the policy and not specially excepted from coverage.  First American Title Insurance Compnay stands behind it’s product.  Make sure you choose a good title insurance before you close on your next property.

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