Understanding Title Insurance Coverage Benefits in Windsor
Title Insurance is the protection against loss arising from problems connected to the title to your property. Before you purchased your home, it may have possibly gone through several ownership changes, and the land on which it stands went through many more. There may even be a weak link at any point in that chain that could emerge to cause trouble. Title insurance covers the insured party for any claims and legal fees that arise out of such problems.
Is Purchasing Title Insurance Required?
It is if you need a mortgage, because all mortgage lenders require such protection for an amount equal to the loan. It lasts until the loan is repaid. As with mortgage insurance, it protects the lender but you pay the premium, which is a single-payment made upfront.
What Title Insurance Does for You
The required insurance protects the lender up to the amount of the mortgage, but it doesn’t protect your equity in the property. For that, you need an owner’s title policy for the full value of the home. In many areas, sellers pay for owner policies as part of their obligation to deliver good title to the buyer. In other areas, borrowers must buy it as an add-on to the lender policy. It is advisable to do this because the additional cost above the cost of the lender policy is relatively small. The Group Guaranteed Title – Title Insurance Agency is here to help with all your title insurance needs in Windsor. Call (970) 613-4364 to contact us.
The Lender Policy Versus Title Insurance in Windsor
Title policies are indemnity policies, they protect against the loss, and a lender policy would only cover the lender’s loss. Of course, the fact that the insurer issued a policy to the lender indicates that the title has been searched, and nothing amiss has been found, but no search is 100% dependable. That is why a title insurance policy is issued.
Title Insurance Protection Period
Title insurance only protects against losses from claims that arose before the date of the policy. Coverage ends on the day the policy is issued and extends backward in time for an indefinite period. This is in marked contrast to property or life insurance, which protect against losses resulting from events that occur after the policy is issued, for a specified period into the future. The owner’s protection lasts as long as the owner or any heirs have an interest in or any obligation about the property. When they sell, however, the lender will require the purchaser to obtain a new policy. That protects the lender against any liens or other claims against the property that may have arisen since the date of the previous policy.
Title Insurance Protection in Windsor
Many events beyond your control can reduce the value of your house after you buy it. If it is a newly-constructed house, sub-contractors claiming they had not been paid by the builder may place a lien on the house. Identity theft can result in a new mortgage you know nothing about. A neighbor could build on your land without your knowledge, thereby adversely possessing and possibly eventually taking your land. Or you may suddenly be told that you must correct a zoning violation of the previous owner.
Does Title Insurance Coverage Rise With Increases in the Value of My Property?
Title insurance coverage does not rise with property values. However, you can buy additional coverage as a rider to the policy. If your policy does not have such a rider and your property has appreciated sharply in value, you may be able to purchase additional coverage on the same policy by paying an incremental fee. The fee should be modest because no new title search is involved. The coverage will only apply to title defects that existed before the original date of the policy. To extend the coverage to events that may have clouded the title since the original policy, you would need to take out a new policy with a new search and pay the full rate.
Title Insurance in Windsor
The Group Guaranteed Title – Title Insurance Agency is here to help with all of your title insurance needs in Windsor. Call (970) 613-4364 to contact us. Check out The Group Guaranteed Title – Title Insurance Agency rate card and learn more about our performance standards. Our vision is to be the best in the industry by striving for extraordinary results in our service, products and customer satisfaction.