Especially when it comes to first time homeowners, there is not a lot of common knowledge about title insurance. As their trusted real estate professional, this is your chance to educate and guide them, and this blog post contains some good information to start that dialogue.

Two of our own experts, Tami Finch and Lisa Sheflet, have some helpful insights you can reference in your conversations about this topic and as always, you can also reach out to Trademark Title with any other questions you might have.

Common Misconceptions About Title Insurance

It’s not really necessary

“People tend to think that because we conduct a title search and clear the issues we know about, that title insurance isn’t needed,” says Tami. “What they don’t realize is that title insurance protects them against matters not disclosed in the public records, which we have no knowledge of.”

It’s too expensive

“In reality, title insurance is one of the most affordable coverages you will find, as it is a one time fee based on the purchase price, for as long as you own the property,” says Tami. Considering that most other insurance involves ongoing payments, emphasizing the one-time-fee may help people move past this idea.

You can do that right?

“Customers or clients tend to think we can draft many documents that should be done by an attorney.” says Lisa. She advises having an attorney involved if a trust or estate is part of the transaction.

Issues to Look Out For

Fraudulent activities

“There is an increase in fraudulent transactions, such as vacant land being sold by people posing to be the seller, to which we are taking additional steps on all vacant land transactions where we represent the buyer to prevent such fraud,” says Tami.

In this case, a good title company will be in the know and keep their agents updated accordingly if a transaction is at risk of fraud.

Judgments or liens

“When title insurance is being issued, a search is done on all named parties, and can disclose liens or judgments that may be against the individual(s), yet not recorded against the property,” says Tami.

She goes on to say that buyers and sellers may not disclose this to their agents and it could take significant time to resolve. 

Divorce, estates or trusts

“Make certain you are aware if a property is part of a divorce, estate or trust,” says Lisa. Once again, other parties may need to be involved and extra time needed to rectify.

Surveys or splits

“If there is a survey or a split of the land to be done or that is in process, let your closer know and provide the survey ahead of time to prevent delays in closing,” says Lisa.

Solving Problems and Finding Solutions

One of the biggest ways you can be an advocate to both your client and a partner to the title company, is to keep lines of communication open and ask lots of questions.

“Many title matters require the seller to be involved in fixing the issue,” says Tami. “As much as we don’t want to bother the seller, title companies don’t have access to old mortgage accounts, for instance.”

Communicate with your title professionals…they are your partners to get your transaction closed but we cannot do it without clear communication from agents and their clients.