Title Insurance FAQs: Everything You Should Know

Title-Insurance-FAQs
Title-Insurance-FAQs

Most people only purchase title insurance a couple of times in their life. So it’s not at all unusual for customers to have questions about this. We believe that all title service customers deserve to have a thorough understanding of what they’re buying and why it is important. As such, we are always happy to answer our customers’ questions about title insurance. Below, you’ll find some of the most common questions we receive — along with their answers.

What are the two types of title insurance?

The first type of title insurance is owner’s title insurance, which protects your interest in the home as its owner. The second type is lender’s title insurance, which protects the bank that holds your mortgage. Lender’s title insurance is required in most cases. Owner’s title insurance is not always required, but it is highly recommended. The best title insurance companies will talk with you about your risk and help you decide whether an owner’s policy is needed.

Do you need owner’s title insurance and homeowners insurance?

Sometimes customers assume that if they have homeowners insurance, they don’t need owner’s title insurance. However, both types of insurance are important because they cover different risks.

Homeowners insurance applies to your home and physical property.  The owner’s title insurance protects the deed to your property and your actual ownership of the property. If any liens against the property or other defects in the deed were to be discovered after closing, title insurance would protect your ownership of the home. It would also pay for any fees or costs related to the discovery.

Do you need title insurance when you refinance?

When you refinance a mortgage, you do still need a lender’s title insurance policy. This policy protects the bank from any unknown liens or judgments against the property.

Do you need title insurance on new construction?

In most cases, you should still purchase title insurance when buying new construction. Even though the building is new, the land is not. The land will have had at least one owner before you. In this case, title insurance will protect you and the lender against any potential defects in the title for the land.

How do you pay for title insurance?

Title insurance is typically paid for during closing. If you close with a title company in Pennsylvania, the fee for title insurance is often wrapped up in a closing fee that also includes the title search and the settlement fee. The fee for title insurance is a one-time charge.

Hopefully, these questions and answers have cleared up some of the queries you had about title services. If you’re looking for a title company and an escrow agency , contact Heritage Land Transfer. With more than 30 years of experience, our award-winning team of professionals always put the clients’ needs first. We partner with industry leaders and employ our own team of in-house attorneys to ensure a smooth, worry-free closing process.

Lender’s Title Insurance Policies, Everything You Need to Know

title insurance company in Philadelphia
title insurance company in Philadelphia

When you purchase real estate with a mortgage, there are a number of fees you’re required to pay. One of these fees will be for the lender’s title insurance. It may sound strange, at first, for you to pay for insurance for your bank. However, once you know the basics about lender’s title insurance, it becomes more clear why such a policy is needed. Here are the key facts that all potential home buyers should know about lenders’ title insurance.

What Is It?

Title insurance exists to protect the policy holder from any defects in the title that are revealed after the sale of the home. For example, if a home is found to have a lien against it years after you purchase it, title insurance will come into play. It will also come into effect if someone else is found to have a claim to the property after the sale.

Why Does the Lender Need It?

It’s important to point out that the lender’s title insurance protects the lender — your mortgage holder — and not you, personally. If someone has a claim or lien against the home, this policy ensures they can not come after the bank for the money they claim to be owed. The insurance company will instead pay any necessary costs.

Do You Have to Buy It?

Yes. If you take out a mortgage to purchase a home, buying a lender’s title insurance from a title service is required. You should be informed as to the cost of such a policy early on in the home buying process. It’s generally wrapped into your closing costs.

How Much Coverage Does It Offer?

A lender’s title insurance policy usually offers coverage equal to the loan amount. For example, if you take out a $200,000 mortgage, your lender will need a title insurance policy for $200,000. As you pay off your mortgage and the lender’s interest in your property decreases, the title insurance coverage decreases, too.

Should You Have Title Insurance, Too?

If you also want personal protection from any liens or claims against your property’s title, then you will need to purchase what’s known as owner’s title insurance. This is a separate title insurance policy from the one that protects your bank.

Owner’s title insurance is not required by law, except under some very specific circumstances. However, holding such a policy is a good idea, especially if you have reason to believe there may be claims or liens against the home that weren’t uncovered in the title search.

Purchasing a lender’s title insurance is an important part of any real estate transaction that involves a mortgage. If you’re looking for a title company Philadelphia residents rely on, consider Heritage Land Transfer. We’re a full-service title company and escrow agency that offers a superior experience, thanks to our client-centered approach and decades in the industry.

4 Things You Need to Know About Commercial Title Insurance

Buying commercial property always comes with some risks. One of those risks can be related to the property title. Commercial title histories can be long and complex, and it’s not terribly rare for previous liens or claims to a title to show up. The good news is that commercial title insurance from a title company can protect you and your lender from these risks. Here are a few key things you should know about commercial title insurance.

1. There Are Two Key Types of Title Insurance

When you’re purchasing a commercial property, there are two separate entities that should take out title insurance policies. The first is your lender. In fact, most lenders are required to have title insurance in order to hold the loan on a commercial space. This title insurance ensures that if there is an issue with the title, the lender is protected from financial risk.

The second party that should buy insurance from a title service is the buyer. In commercial transactions, this is generally the LLC, sole proprietorship, or corporation that is buying the property. This policy is separate from the one held by the lender, and it protects the business financially should any title problems come to light.

2. Title Searches Don’t Negate the Need for Insurance

Before you buy a piece of commercial real estate, you should have a title company conduct a title search. This search should turn up any liens or claims to the title prior to purchase. However, the title search process can occasionally miss liens. As such, a title search is not a replacement for title insurance. Even the best title company Pennsylvania has to offer may not be able to uncover everything in the search process, and insurance protects you from this possibility.

3. Commercial Title Insurance Is Paid For Once

Commercial title insurance is not something you or your business need to pay for month after month. Rather, you pay for this insurance via a one-time fee due at closing. The escrow agency will typically hold the funds while you’re in the process of purchasing the real estate. Then, when you sign the closing documents, the title insurance company will be paid for the policy or policies. 

4. Title Insurance Offers Continued Protection

Policies to protect both you and the lender last for as long as you own the property. Or, in the case of the lender, they last as long as there’s a loan out on the property. So, if an issue with the title comes up in 5 years, you’re protected. If an issue arises in 15 years, you are still protected. It’s nice to get such long-lasting risk reduction for a one-time payment at closing. 

Commercial property can be a sizable investment, so it is worth protecting your investment. Your lender will likely require title insurance, and you should strongly consider taking out a policy to protect your business, too.

Contact Heritage Land Transfer to learn more about our title services. Our stellar customer service, unmatched resources, and guaranteed lowest rates are brought to you by an award winning team of professionals, dedicated to helping our clients and partners have the most seamless transactions.

6 Reasons to Choose Heritage Land Transfer Company, Inc as Your Title Company

Title search and title transfer are two very important parts of a real estate transaction. It’s important to choose a title company Pennsylvania residents can trust in order to handle these processes. At Heritage Land Transfer, we are proud to be a step above the competition. We are confident we can handle your transaction with ease, but don’t just take our word for it. Here are a few key reasons to choose us as your title company

1. Guaranteed Lowest Price

You will not find a lower price on your commercial or residential title insurance. When you get the best service and the best resources at the lowest price possible, there is no need to shop around!

2. 20-Minute Closings

Closing on a real estate deal is not anyone’s idea of a good time. As such, you probably don’t want to be sitting around the closing table and signing paperwork for any longer than is necessary. At Heritage Land Transfer, we can deliver 20-minute closings when time is of the essence. This allows you to finish and get on with your day, whether that means heading back to work or going home to see your family.

3. In-Home and Virtual Closings

Do you have kids you don’t want to leave with a sitter? Perhaps your car is in the shop. If you can’t make it to our offices, we can come to you. We offer in-home closings to make things simpler for our customers, whatever their needs may be. 

Maybe you got called away on travel, or perhaps you’re selling a home remotely. In cases like these, we can provide title services and closings virtually and securely, using our cutting-edge software.

4. In-House Attorneys

Many title companies rely on outside attorneys. This slows down the title search process and can lead to longer closing times. At Heritage Land Transfer, we employ our own attorneys in-house. This allows us to provide our customers with more comprehensive services, and it also allows us to work faster than our competition.  

5. Client-Focused Approach

Every client is unique. As we work with you to facilitate your real estate transaction, we get to know you personally so that we are better able to understand and fulfill your unique needs.

We have in-house interpreters to help us communicate clearly when a language barrier comes into play, and we contract with additional, outside translators as needed, too. We’ll keep you informed every step of the way as we conduct your title search, prepare your settlement, and ready your account for closing.

6. Community Involvement

At Heritage Land Transfer, we are proud to be a part of the communities we serve. Our employees can spend up to 20 paid hours each year volunteering in the community. We also offer scholarship programs to help support our youth.

If you’re looking for a title company Philadelphia is proud to call its own, then Heritage Land Transfer is the choice. We offer a wide range of services, from title transfer to contingency resolution, and we are also an escrow agency.

Contact us to learn more about us and our dedication to putting clients first.

What Title Insurance and Is It Necessary?

Title Insurance Company
Title Insurance Company

When you purchase real estate, you receive an official document called a title, which is meant to show or prove your ownership of that property. As a part of the purchasing process, your attorney and title company will review the title to see whether there are any past claims or liens against it.

On a rare occasion, an attorney might overlook something, or information relevant to the title may be concealed. What happens then? Well, if you purchased title insurance, you’ll be protected, and your property ownership will be maintained. Keep reading to learn more about title insurance and why it’s so important.

What Is Title Insurance?

Title insurance is a type of insurance designed to protect the policyholder should any problems with the title come to light. What could go wrong with a property title? The most common example is a previously unreported lien.

Say, for instance, your title services company conducts a title search prior to your purchase of the property. They fail to discover that Company X has a lien for $100,000 against the property. You find this out 5 years later when Company X shows up and attempts to collect their money. Without title insurance, as the current title holder, you’d be liable to pay that $100,000. If you have title insurance, it becomes your insurer’s responsibility to pay. 

In addition to protecting you against unreported liens, title insurance protects you from unintentional errors in the filing of documents, forged ownership rights, and other title defects that originated prior to your purchase of the policy.

Who Needs Title Insurance?

Lenders always purchase title insurance as a part of the mortgage process. The bank needs to know that if a defect is discovered in the title, they are not liable for the damages. The cost of this title insurance is generally held in an escrow account by an escrow agency and passed on to the buyer during closing.

Homeowners are not required by law to buy title insurance, but it is a good idea. While there are only a few claims made on title insurance policies each year, learning that there’s a lien on your home can be financially devastating. Title insurance, by comparison, is very affordable. Plus, once you purchase a policy, it never expires. You are forever protected against any issues that may arise with your title.

It’s wise to buy title insurance when purchasing any property. However, it is especially important if you’re buying a home in foreclosure, as a short-sale, or at auction. Homes being sold in these ways are more likely to have a complicated history of ownership and title defects.

Title insurance is mandatory in PA and NJ for property purchases involving loans. While title insurance is not required for homeowners paying cash, it is still highly recommended. If you’re looking forr a title company Philadelphia, trust Heritage Land Transfer to save you many headaches in the future. Contact us today to learn more about our services. We’re a title company Pennsylvania and New Jerssey residents have depended on for over 30 years for title transfer, lender coordination, title distribution, contingency resolution, and more.