This just might be the biggest real estate decision that you’ve never heard of. Even seasoned homebuyers can get confused by title insurance, and why their lender requires them to purchase it. In short, title insurance protects homeowners against any defects found in your title and acts as a “safety fence” around the biggest purchase of your life.
Title insurance is needed if, for example, there is a hidden mistake in a prior deed on your home that gives someone else a valid legal claim against your home (such as a lien or a judgment). With title insurance, you are protected if a former owner didn’t pay a contractor for work performed and they placed a mechanic’s lien against the home, or if there was a clerical error that resulted in your name being transcribed incorrectly on your title. Title insurance is paid in a single premium at the time of your home purchase.
There are two types of homeowners’ title insurance policies that can be purchased: standard and enhanced. Standard rates are mandated by the state government, so all title insurance companies will charge the same amount. Enhanced policies result in a 10% premium increase, but cover a buyer against far more potential issues. This includes subdivision law violation coverage (if you live in a planned development), zoning coverage, map and address coverage, and building permit violation coverage, among other things.
When you are exploring your title insurance options, be sure to discuss your options with your knowledgeable EveryHome agent and a licensed title agency. EveryHome works closely with Security Abstract of PA, Inc in Worcester Twp, PA and they invite any questions that you may have. They can be reached at (610) 584-6890
Information provided by Security Abstract of PA, Inc and some of the aforementioned information may only pertain to the state of Pennsylvania.