Protecting your Home Investment

A home is usually the largest single investment any of us will ever make. When you purchase a home, you will purchase several types of insurance coverage to protect your home and personal property. Homeowner’s insurance protects against loss from fire, theft, or wind damage. Flood insurance protects against rising water, and a unique coverage known as title insurance protects against hidden title hazards that may threaten your financial investment in your home.

The most important aspect of any real estate transaction is to be certain that the title to the property you are purchasing is free and clear and has no claims against it. The title to real estate is subject to a complicated maze of legal technicalities and regulations. If the laws are not followed exactly, the title to your property might be questioned.

Some examples of common title problems are:

• The deed that you receive from the seller is improperly signed and fails to comply with legal requirements
• You receive a deed from a person who is not the real owner of the property.
• There are liens or other claims against the title to the property that are discovered only after your purchase

How Do You Find Out What Claims Exist?

Before your closing, the title search professionals at Collazo Title & Closings, P.C. perform an examination of the title to the property you are purchasing. After an extensive review of all relevant documents appearing on the public records, Collazo Title & Closings, P.C. will issue a Title Insurance Commitment. The commitment gives a status report of the title to the property. The commitment includes a list of requirements that must be satisfied before title to the property is considered clear. Your closing is scheduled after the title requirements have been met.

Two Kinds of Title Insurance benefit You in Two Ways

There are two basic kinds of title insurance:

• Lender or mortgagee protection,
• Owner’s coverage.

Title insurance is designed to protect you – the purchaser – from claims made against your ownership of the property. If a claim is ever made, the title insurance will defend your right to own the property. If a court determines that the property does not belong to you, your title insurance will compensate you for your losses in accordance with the terms of the policy. The title insurance issued to purchasers is known as an owner’ s policy. If you are getting a loan for your purchase, your lender will require title insurance as well. The title insurance issued to protect the interests of the lender is known as a lender’ s policy or mortgagee policy.

Undiscovered Title Hazards

In spite of all the expertise and dedication that go into a title search and examination, undiscovered claims can emerge after closing, resulting in unpleasant and costly surprises. Title insurance offers financial protection against these and other covered title hazards. The title insurer will pay for defending against an attack on title as insured, and will either perfect the title or pay valid claims. All for a one-time charge at closing.

After the closing, and after your deed and mortgage are recorded on the public records, Collazo Title & Closings, P.C. will send you your original Owner’s Title Insurance Policy. Please be sure to keep the policy in a safe place.

Collazo Title & Closings, P.C. is proud to be an authorized agent of Old Republic National Title Insurance Company, one of the leading title insurance underwriters in Massachusetts.