Chances are if you’ve purchased a home, you’ve wondered whether purchasing Title Insurance is really something you need.
You’re given a hefty stack of papers to grace with your signature, and quite a few fees and costs that go along with it, and you may be tempted to just forego the extra protection. The mortgage company will have taken out their own insurance, but for that coverage to extend to you and your home, you’re required to pay that one time fee as well. Again you wonder, is it worth it? After all, what’re the odds of something going wrong? And if it does, how bad could it really be?
Turns out, pretty darn bad.
Let’s go ahead and move past the ‘what if’s’ and move right into worst case scenario. Consider this: you’ve purchased a home, you’ve signed on the line and declined title insurance and moved into your new home to make all kinds of beautiful memories. And then you discover that unfortunately the title wasn’t clear, and the home that you purchased has claims against it from other parties. Essentially, you’ve paid for a property that wasn’t legally available to be purchased.
Uh-oh. You’ve got Title Trauma
You didn’t pay for title insurance, and now you’re hearing about claims being made against the property by other parties who have liens, loans or collateral against the property. It may be contractors who have filed liens against the property for unpaid bills, or unpaid tax bills, even previous mortgage lenders or homeowners’ associations with back payments – there are a number of different individuals or companies with claims against the property, and now you’re in the position of sorting out what is what.
They may not be your bills, but unfortunately, they’re now your problem.
The problems that could arise are numerous – as well as the outcome. Whether it’s an unpaid bill or a claim to ownership, the issues could well result in you losing the home you’ve put so much heart and money into.
So is title insurance worth it to avoid title trauma? Turns out, nothing is more important than your peace of mind.