Owner's Title Insurance

Owner's Title Insurance is a MUST to Protect Your Down Payment and Equity.

Lenders require insurance on their portion of the loan, but that insurance does not cover your down payment or equity.

Title insurance pays for any liens against the property that were not filed before the attorney ran title clearance before you closed.

Liens can be placed on new construction and on re-sales.

Speak to the closing attorney before closing or at closing about the owner's title insurance. Closing attorneys are the only people who can offer title insurance to you.

The cost is based on the amount of purchase and is a very inexpensive investment of a few hundred dollars.

This information is from a closing attorney website that Rhonda knows, Jill Elliott. Read her advice about Owner's Title Insurance.

Owner's Title Insurance is the best protection to stop you from losing your home in case of fraud or other unknown risks.

What type of risks are covered?

Forgery of a Deed by a previous Seller

• Was that really the Seller's Wife or his secretary who signed the Warranty Deed at your closing?
  

Undisclosed or unknown owners

• When the previous owner gave the property by will to all of his grandchildren, who knew little Gilligan did not die on that three-hour tour, now Gilligan could be part owner of your house.
  

Misfiled or Recent Deeds

You're insuring against problems that could not possibly be discovered during a normal exam. If a previous Seller had a loan that was never paid off, that loan could be foreclosed on you! If the person you are buying from just got a second loan on their property the day before they sold you the house, it would not be of record, but it still could be foreclosed upon and your house could be taken away, unless you buy Owner's title Insurance.

Your Lender requires you to buy Lender's Title Insurance to protect them, so why should you buy Insurance on top of that?

The Lender's Insurance protects the Lender in case there is a claim on the Property but their Insurance does not protect you. If someone comes along who has a rightful claim to your property, your Lender will be protected and they will get the money owed to them from their Lender's Title Policy, BUT that doesn't mean you no longer owe the money. Since the Title Insurance Company "bought" your loan from your Lender, they have the right to make you pay them, the Title company.

Of course if you have an Owner's Title Policy, then not only will they not try and collect from you, they will be obligated to pay you for your loss up to the Policy limits.

IF WE COULD ONLY STOP THE RUMORS ABOUT TITLE INSURANCE STARTED BY PEOPLE WHO HAVE NO REAL IDEA ABOUT IT. If somebody tells you not to buy it, will they be around to help pay any attorney's fees and claims for you if needed?

You're insuring against problems that could not possibly be discovered during a normal exam. Good news: In 1999 most title companies changed their policies to offer inflationary coverage which is included in your premium ($50.00 one time fee) and it is already on your HUD-1.

Bottom Line: Rather Be Sorry You Bought It or Sorry You Didn't?

Title Insurance Horror Stories!

The infamous wrong Seller in Cobb County

Seeking Closer on the Developer

In Northeast Cobb County a Land Developer built six really nice homes in the Shallowford Forest

subdivision. Unfortunately he neglected to pay the people who lent him the money to build the homes. The Lender in this case filed for foreclosure on all six homes. They had the right to take the homes away from the owners. The lender stopped foreclosure when new Owner's Title Insurance companies got involved to ensure the old $250,000 loan would be paid.

The Tax Man Cometh

When a certain Seller was going to sell his land he learned that the county real estate taxes for his property that were supposed to be paid when he bought the property were instead sent back to the land developer The developer thought this meant nothing more was owed. Unfortunately, he was wrong. The taxes were never paid and when it comes to taxes, there is no talking to the county. They want their money. Fortunately this Seller had bought Title Insurance when we bought the property. The Seller sent a copy of the HUD 1 closing statement showing the taxes as being paid at closing and sent the bill that He had to pay the county and the Title company quickly sent him a check for his expenses including the late penalties. (Title claim, year 2000).

In 1954 Minnie Wood bought 54 acres in Cobb County. In 1979 the land was sold by someone who said they were Minnie Wood. 59 homes were built on this land in Cobb County now called Anne Place subdivision.

As you have guessed, it was not the real Minnie Woods who sold the land. The Really Minnie Woods had died a year after buying the property leaving the land to her two children, Henry Wood and Marjean Birt.

Well, Henry Wood had married and divorced a lady by the name of Margaret and it was his ex- wife Margaret Wood who sold the land pretending to be Minnie Wood.

As you can imagine, you cannot sell what you do not own. Therefore when Margaret sold it was not legally binding. The rightful owners filed a lawsuit. The homeowners who bought Title Insurance when they purchased their home were protected, those who did not, well they were not protected.

Singing the Macon Lender Blues

A developer on Macon built a few homes. He got a couple of loans in the process, some of the purchasers got loans through his lender as well to buy the houses.

Well, when he sold the houses not all the loans were released of record. In some cases, the lender released the loans improperly and then turned around and sold the loan over and over again. So here are a bunch of lenders who think they all own the rights to a loan on the property. In accordance with Murphy's Law, the developer went bankrupt and the lender went bankrupt amid allegations of fraud.

Just try and fix a mess once the government decides to get involved. The homeowners and the lenders who had Title Insurance were able to simply make a phone call and the attorneys from the Title Company handle going to court to clear their title. Those who did not, well I do not envy them.

If you cannot trust your church, whom can you trust?

If your church decided to sell some land, wouldn't you trust that they owned it? Well, it may not be your church you have to worry about. Just as in kissing, it is not only the person you are kissing you have to worry about, you have to consider all those they kissed before ,.. and their attorneys.

In this case, a church bought some land from a parishioner and then sold it to another party. Well, unbeknownst to the church, The previous owner had given the land to his wife, so he no longer owned it (Remember, you can not sell what you do not own). I am guessing at the time since it was all good friends involved, no one checked. Well when it came time for the new owner to sell the home, he discovered he did not really own the property.

To make matters worse, before the old parishioner gave the land to his wife, the United States Government put a federal tax lien on him. Well, that lien also encumbers the land he owned at the time the lien was placed. Even though he no longer owns the land, Uncle Sam can come by at any time to claim the land.

Do not feel too bad in this case. The person who bought the land actually was foreclosed upon. It was his lender who made a claim under Title Insurance to get their money back.

Isn't it worth the one time charge of Owner's Title Insurance to not have to worry about all these type problems?

If you have Insurance, all you need to do is call up your insurance company, make a claim, then sit back and have their rabid pack of lawyers make sure you own your property. Trust that your own rabid pack of lawyers will charge you much more and will not be as experienced as the Insurance companies.