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Why you need title insurance

At the Law Office of Paul R. Idlas in Illinois, we know how exciting it is to purchase a new home. Whether it is your first home, a larger home for your growing family, or a smaller home when you are ready to downsize, buying a new home is always a very “big deal.” If you are like most people, your home also represents your biggest investment. Consequently, you want to make sure that it has not only the space, layout and amenities you desire, but also is legally yours when you buy it.

That is where title insurance comes in. World Wide Land Transfer explains that while you may be the first people to live in your new home if it was just built, you are not the first people to occupy the land on which it rests. People have bought and sold Illinois land for well over 200 years, and someone needs to check all of those land transfer documents to make sure they are proper and correct. That someone is your title insurance company.

What a title insurance company does

Your title insurance company will track the deed history of your property, and their thorough investigation can answer questions such as the following:

  • Are all previous deeds in order, that is, properly signed and recorded?
  • Is the legal description of your property consistent from deed to deed?
  • Were all grantors and grantees over the age of 21?
  • Did any taxing authority or mortgage lender place a lien on the property that was never cleared?

If the company discovers something wrong with or iffy about your property’s chain of title, they can help you fix it so that you have confidence that your new home and the land on which it rests legally belongs to you.

Lender’s policy versus owner’s policy

If you are like most people, you are buying your home with funds provided by a mortgage lender. Your lender may well require you to purchase a lender’s title insurance policy. Be aware, however, that this policy only protects your lender, not you, against claims of defective title. To protect yourself from claims of this nature, you also must have an owner’s title insurance policy.

The good news is that owner’s policies generally are relatively inexpensive and you only owe one premium for a policy that remains in effect as long as you own the property. In addition, many title insurance companies provide the accompanying lender’s policy for little or no charge.

For more information on this subject, please visit this page of our website.