What happens when there’s a title issue with your home?
Most people barely notice the cost of their title insurance premium when they are closing on their home. After all, compared to the six-figure price tag of your home, that $1,500 or so seems unimportant. However, that title insurance premium can help protect you from the loss of your most important investment and biggest purchase. Some people wonder why title insurance is compulsory on financed homes. The reason why is simple: If there is an issue with title, your mortgage company could lose out on all the money paid toward the purchase of the home.
Thankfully, with a title insurance policy, you and your mortgage company purchased protection against a total loss if there’s an issue with title. However, it’s still possible for you to lose your home. In some cases, you may have to move. Working with an experienced real estate attorney is the best way to ensure a positive outcome if there are issues with your home’s chain of possession or title.
What causes issues with your home’s title?
Issues with title can result from a variety of factors. One of the most common is an issue with an inheritance. If a last will was improperly executed, other family members beside the seller of the property may have a legal interest in the property, which could result in a claim.
Sometimes there are issues or omissions in public records, meaning that a lien against the property isn’t discovered until the new purchaser’s deed goes for recording. There’s also the potential for willful fraud by sellers involving forged documents. Whatever the cause, your title policy protects your financial interest in the property.
Depending on how the courts view the situation, however, you could very well lose possession of the property in question due to title issues. A buyer’s policy should protect any amount you’ve paid toward the home, but it won’t necessarily reimburse you for the emotional strain and inconvenience caused by a post-closing title issue. That’s why you need the help of an experienced real estate attorney. Your attorney can advocate on your behalf and seek the most positive outcome, given the specifics of your case.
An attorney can help protect you in a title dispute
Like many insurers, title insurance companies want to limit their payouts and liability to ensure they remain profitable. That can result in you, as the buyer, not receiving the full coverage and benefits you are entitled to under the terms of your policy. If you have been notified of an issue with title after buying a home, make a point of scheduling a consultation with an experienced real estate attorney as soon as possible.