Title Company, Title Policy, and Title Insurance In Odessa, Midland, Andrews, West Odessa, Monahans, Crane, TX, and Throughout Ector County
For Owners and Lenders – Residential and Commercial
Protecting Your Investment
Title Insurance from Ector County Abstract and Title
For most people, a home is the largest single investment they will ever make. Everyone understands the need for homeowner’s insurance to protect your investment against certain risks such as fire, theft and wind damage. Individuals who live in floodplains by flood insurance to protect against the damage caused by rising water. However, few people truly understand or comprehend the need for title insurance.
Why Title Insurance is a Necessity
While it may not be as commonly understood as other types of property insurance, title insurance is equally important and, in some cases, even more necessary. Title Insurance actually protects against hidden hazards that can limit your rights to a property, resulting in serious financial losses as well as personal and/or professional inconvenience.
When you purchase a home or commercial property, in all actuality what you are really purchasing are the rights to that property. This means that even though you own the physical property, there may be specific limits as to how you can use it. You purchase the title to a property, and that title gives you the right to occupy and use that property. However, the title may be limited by rights and claims asserted by previous owners, lienholders or other invested parties. Title Insurance protects against these types of title hazards.
While homeowner’s insurance protects the physical property against the possibility of future perils, title insurance protects against loss from hazards and defects that the title already contains. title insurance is purchased with a one-time premium, whereas homeowner’s insurance requires the payment of an annual premium.
The Two Types of Title Insurance
There are two basic forms of title insurance that provide protection not only for you, the purchaser, but also protect the rights and interests of the lending institution.
Lender or Mortgagee Title Insurance
Is required by most lenders to secure their investment in real estate. This insurance protects the interest of lenders by assuring their lien is included on the title…and that their lien takes precedence over any other existing claims. When this protection is afforded, lenders agree to loan monies on properties located in markets that are unfamiliar to the lender.
Owner’s Title Insurance
Is in effect for as long as the policyholder or the policyholder’s heirs have an interest in the insured property. Predicated on local practices and varying laws in the state in which the property is located, you may be required to pay an additional premium for an owner’s policy, or you may pay a simultaneous issue charge for the separate lender coverage. This is usually a smaller amount. In some instances, you may be able to split settlement costs with the seller for the lender or owner’s policy.
What Title Insurance Does For YOU
Simply put, Title Insurance eliminates risks that could lead to claims against your title and actual laws of your ownership rights. There is a comprehensive investigative process that takes place before title insurance can be issued.
First, public land records that affect your real estate are thoroughly searched. a title agent or attorney conducts an examination on behalf of its underwriter to determine whether the property is insurable. This examination of evidence is to fully report all “material objections” to the title. Frequently, documents fail to clearly transfer title that is found in the title chain or history, that is assembled from the records in a search. Documents that present cause for concerns may include:
- Deeds, wills, and trusts that contain improper wording or incorrect names
- Outstanding mortgages and judgments, or a tax lien against the property
- Easements that allow construction of a road or utility line
- Pending legal action against the property that could affect a purchaser
- Incorrect notary acknowledgments
The thorough search and examination process discloses title problems, enabling the Professionals of Ector County Abstract & Title to correct them whenever possible.
A Title Policy offers Protection Against Hidden Hazards
No matter how advanced the technology; despite the diligence of the most dedicated staff member, there is no guarantee that hidden hazards won’t emerge after closing. Unfortunately, these often result in unpleasant and costly surprises. Examples of hidden hazards include:
- A forged signature on the deed which would nullify any transfer of ownership to you
- An unknown heir of a previous owner who is claiming ownership of the property
- Instruments executed under an expired or fabricated power of attorney
- Mistakes in public records
While there is no guarantee that these hazards won’t occur, you can enjoy peace of mind knowing that title insurance offers financial protection against them. The title insurer pays the insured to defend against an attack on the title. The title will either be protected or any valid claims will be paid, and you receive all this protection for a one time fee at closing.