Congratulations! If you are reading this, you most likely have decided to purchase a home and you are getting ready to close. As you have found out, the privilege of home-ownership comes with many different processes, including several different types of insurance. So the question you may be asking is, “Why do I need title insurance?”

The short answer to that question is to cover your investment in case someone else claims ownership of the home. Sometimes there could be an heir that was previously unknown, or a defect in the title. In these instances, title insurance will indemnify you and protect your financial investment.

What About the Preliminary Title Search?
When you are ready to purchase title insurance, the issuing company will first perform an extensive title search, going back many years, to make sure there are no hiccups. The title insurance company will attentively scrutinize public records to ascertain the chain of possession and expose any problems that could set in motion certain difficulties for a new property holder.

The title company will scour deeds, court documents, divorce decrees, tax records, wills, and more to uncover any defects that may arise. However, no amount of careful research can encompass every situation or eventuality. This is where title insurance comes in.

How Does This Work?
Try not to view this as an added cost, but an added benefit. An owner’s title insurance policy can cover not only your investment, but also legal fees that may arise as a result of an issue with a title.

For instance, let’s say that the seller of record, even though he possesses the deed, does not have an actual right to sell the property. If an unknown heir then takes you to court to regain the property, your title insurance will pay the legal fees and indemnify you if judgement is rendered against you.

The bottom line is the cost of your insuring your title is quite minuscule when compared to the risk taken in not securing your investment. You could wind up losing your money, and even your home. Procure your title insurance today and protect yourself and your family tomorrow.