What is title insurance?
Title insurance is a form of indemnity insurance that protects you from financial loss sustained from defects in a title to a property. Unlike other insurances that you purchase, the premium for your policy is only paid once, and that allows your policy to remain in effect for as long as you are the owner of the property.
Is it comparable to homeowners insurance?
No, title insurance is not the same as homeowners insurance. It doesn’t insure against fire, flood, theft, or any other type of property damage or loss. However, title insurance does protect you against losses from ownership problems that arose before you bought the property but weren’t known at the time you bought the property.
Why do I need title insurance?
The work that a title company does promotes and ensures an efficient and safe transfer of real estate from the seller to the buyer. A title policy is your guarantee that the real estate you’re buying is protected from title problems. A real estate purchase may be the largest financial investment you ever make, so it’s important that you choose a title company that you can trust.
Can I choose my own title company?
Yes, you can. Unlike other states, in Texas you can choose any title company you want. you don’t have to use a company selected by a real estate agent, builder, or lender. Here are some things you should look for when deciding: accuracy, honesty, reliability, and service.
Can I get a discount on the price of my policy?
No, you can’t. The premium rate is set by the Texas Department of Insurance. Each title agent is required to charge the same for a policy.
What is a title defect?
A title defect is anything that can cause a title to be considered invalid or defective in some way. Here are some examples:
- Invalid documents due to forgery, fraud, undue influence, duress, incompetency, incapacity, or impersonation.
- Failure of any person or entity to have authorized a transfer or conveyance.
- A document affecting title that is not properly executed, signed, witnessed, notarized, or delivered.
- Undisclosed or unrecorded easements not otherwise apparent on your land.
- No right of access to and from the land.
- A document executed under a falsified, expired, or otherwise invalid power of attorney.
- A document not properly filed, recorded, or indexed in the public records.
- Ownership claims by undisclosed or missing heirs.
- Defect arising from an improper prior foreclosure.
- Undisclosed restrictive covenants affecting your property.
Where can I find more information about title insurance in Texas?
The Texas Department of Insurance provides great information on their website regarding all licensed agents and title companies.
Contact us to see how Ellis County Title Company can help you.
