The only way to ensure that the title on your new house is clean is to have a title company run a title search. During this process, they will uncover any discrepancies with the title so that they are able to be resolved. Even then there is no guarantee that things that are not of public record will not come back to haunt you, such as unknown heirs (pun intended). Your title company will issue title insurance so that if problems do arise during the transfer of ownership of the property, that there is no financial loss as a result.
Advantages of Title Insurance
There are numerous benefits to having title insurance, one of which is simply having the peace of mind that you are protected if a dispute against your title arises. You can trust that the money you are investing in your new home is safe in the unfortunate event of a dispute. Another advantage to title insurance is that you usually only have to pay an upfront fee and protection will last so long as you or your heirs own the property. During your ownership of the property, should any challenges to the title arise, title insurance will protect from the costs, attorneys’ fees and expenses of defending against any matter covered by the policy.
Even if you are buying a brand-new property that has no title history, it is still extremely important that you purchase title insurance. Brand-new properties are especially vulnerable to title risks that include improper title conveyance to the developer, mechanics’ liens by the contractors or subcontractors, unpaid property taxes, encroachments, and forged signatures. And keep in mind, before there was an actual structure, there was still PROPERTY.
When it comes to title insurance, there are two types- Owners and Lenders. As a real estate owner you can choose whether or not to purchase title insurance for yourself, however, most lenders will require that you purchase a lender’s policy. Finding yourself in the midst of a title dispute without title insurance coverage could subject you to major losses and major costs. It’s important as a property owner that your purchase title insurance to help protect the major investment you have made.
Deciding which title company to go with can seem a little overwhelming. A good way to narrow down your options is to choose a title company with a legal background. A title company with legal experience provides the expert knowledge needed to ensure that the process is carried out as thoroughly and efficiently as possible. Reach out to Robin Mathis at Mathis Title Company for more information about title searches and to schedule a free consultation.
What Is “Un”- Clean Title?
A clean title has no unpaid taxes through the last taxable period.
Simple errors in public records can cause problems with your title. Mistakes are easy to make and a simple clerical or filing error can affect the deed or survey of your property. Forged or fabricated documents can be filed within public records, which can obscure the rightful owner of the property. If these forgeries come to light, they may put your rights to the property at risk.
It’s possible for there to be a lien on your property that you are not aware of. Most of the time, this happens when the prior owner has unpaid debts and the bank or other financing company will put a lien on the property. Even if you have already closed on the sale, you are still responsible for paying the debt.
There are several things that can affect the enforceability of a deed, which can affect present and previous ownership. This can happen when a deed was made by a minor, a person of unsound mind, or one who signs under duress. When parties divorce, questions as to ownership may arise. If there are heirs that are missing or unknown at the time of death, family members may contest the will for their own property rights. This can be especially complicated because it could occur years after you have purchased the property, and it may affect your rights to the property. If a property owner dies and there is no apparent will or heir, the property may be sold under the laws of intestacy (no will). Even after you have purchased this property, if the deceased owner’s will arises or heirs appear, there may be disputes over your right to the property. Title insurance is essential in protecting your financial investment in the property should discrepancies like these arise.
For more information about a clean transfer of title, reach out to a Northern Virginia Title Company such as Mathis Title for more information and to schedule an initial consultation about how you can benefit from title insurance and title services.