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What Southwest FL Real Estate Agents Must Know About Title Insurance

Title insurance is often misunderstood by prospective homeowners. They might know they should obtain title insurance, but they might not know why. As a Southwest Florida Real Estate Agent, it is your job to explain the importance and significance of title insurance to your clients. You’ll need to tell your clients that title insurance is necessary to ensure their legal claims to the property are protected. In order to accurately advise your clients regarding title insurance, there are four things you should know.

What Southwest FL Real Estate Agents Must Know About Title InsuranceKnow How Title Insurance Protects Your Clients

You might have explained to your client that title insurance will protect them from any claims against the property before they acquired that property. But what exactly does this mean? Let’s say, for example, that your client buys a home only to find out a contractor has filed a lien against the property because the previous owner didn’t pay up. If your client has title insurance, they are not responsible for paying the lien. However, that scenario is quite different if they don’t have the title insurance, meaning they are responsible for any claims against the property, no matter the circumstances.

Value of Title Services is Long-Term

When explaining the benefits of title insurance, Southwest Florida Real Estate Agents would do well to mention the enduring value of title insurance. Prospective homeowners need to know that for a one-time low fee at the time of the purchase, they and their heirs are protected financially from unknown defects that could cause financial hardship otherwise. The fee paid at the time of closing is based on the value of the home.

Why Naples Florida Is The Best Place To Retire

When looking for the best place to retire there a many things to take into consideration. Florida has been a very popular destination for retirees for decades, and with good reason. A good retirement location needs to consider different things such as the economy and opportunities to stay active and social. We’ve done the research for you and think Naples, Florida is a cut above the rest.

Why Naples Florida Is The Best Place To RetireStable Economy and Future Growth

When you’re settling down to retire, you want to ensure the community you’ve chosen is going to remain stable. You don’t want to be left searching for a new home in later years. Naples, in Collier County, is a beautiful, coastal town named after its Italian counterpart for the similarities they share in climate. The Naples’ economy is largely dependant on tourism. With its idyllic beaches, close proximity to the Everglades, host of activities and balmy Florida weather, this isn’t likely to change anytime soon.

Healthcare

As we age it’s important to know that we have quality, accessible healthcare when we need it. In a population of only 20,600 residents Naples, part of the non-profit NHC Healthcare System, boasts over 681 beds within two hospitals in addition to six clinics. The Healthcare Network Southwest Florida serves Collier County residents through 20 practices including general health, behavioral health and dental.

Types of Liens to look out for

There are two different types of liens against homes — voluntary liens and involuntary liens. Voluntary liens are security interests that have been granted by the owner, such as a mortgage. However, there are many more types of involuntary liens on real estate than voluntary liens. Below we discuss the different types of liens that may be filed against a home.

Nine Different Types of Liens

Types of Liens to look out forAny of these liens can create a cloud on the title making it impossible for the owner to transfer clear title to the property.

• Mortgages — When most people purchase a home, they typically borrow a portion of the sales price. The document filed to secure the loan with the home is a mortgage. Homeowners can have multiple mortgages on a single piece of real estate. If a mortgage has been paid, but not satisfied of record, someone must contact the mortgage company to request that the company research the account to determine if the lien can be canceled. This process can be time-consuming and frustrating, especially for mortgages that have been sold or assigned. Another issue that can make the process difficult is when the bank has closed or changed names.

• Equity Line — An equity line is also a mortgage, but it allows the homeowner to access the equity in the home. Even though the homeowner may have paid the equity line in full, as long as the mortgage is recorded, it is a valid lien on the home.

errors in public records

Buying a home is a major event in a person’s life. Beyond the basic shelter it provides, a new home purchase often signals a turning point in our lives, one that makes us crave a more permanent space to make our own. It often happens at a time when we are tired of renting small apartments that no longer provide what we need. Choosing a home is a difficult decision to make and, often a much more difficult plan to see to fruition. With so much time and money involved, we hope things will come together quickly, so that the home we want will be ours. In such an important process, mistakes are sure to occur that slow things down. Even though the house you want to purchase will be new to you, it already has a history. To establish a clear title on a property, a title search will need to be completed. One frequent problem during the title search, is an error in public records. What effect can a public records error have on the deed in question?

errors in public recordsDuring a title search, both municipal and county officials will check any documents that are associated with the property. This includes street assessments, sewer assessments, judgements, special taxes and assessments, along with any other documents that have to do with the title. Although these are official government documents, sometimes human error can cause a problem during the title search. Errors in spelling, wrong address, inaccurate property description, and incorrect information can all influence the deed and cost you unexpected fees. One example of an error in public records is a property description that seems to be correct, such as the square footage of the house. Banks only offer 80-90% of the home’s appraisal value and if the square footage of the home is not the same as that listed in the documents concerning title, the homebuyers may run into problems with the loan amount. The buyers may find themselves unable to get the loan amount they need, leaving them unable to buy the home. Mistakes in the filing of documents, pending legal action, or undisclosed mortgages can also add to a homebuyer’s problems. With all these issues and more, how can you avoid public records errors when buying a home?

The truth is, you cannot completely avoid errors in public records since you do not have control over the history of a property you wish to buy, and you certainly cannot control a mistake that may have been made decades ago. However, there is one thing that can protect your rights of ownership from errors that are found in public records. A Lender’s Policy only protects the loan, not the property. A homeowner’s title insurance policy from Heights Title Services, LLC will protect you for the whole time you own your home. The only time your coverage decreases is when you make those changes to your policy. Depending on the coverage you choose, this may cover the legal costs you may incur while defending your interests and the losses you sustained because of a title error.

Even a newly built home needs title insurance

At closing on a new home loan, you may see paperwork concerning title insurance for the lender. This insurance protects the lender against the validity of the mortgage and secures their investment. You may think that this protects you, as the mortgage holder, but it does not. There are several reasons that a newly built home needs title insurance – chiefly, to protect you, the homeowner.

You might not be the first owner

Even though your home is new construction, and you purchased the lot for the house, you may not be the first owner of the property. In fact, your plot may be a parcel of larger acreage, one that has changed hands several times before being developed. Title insurance guards you, the homeowner, against liens against the land itself. The title search conducted as part of your insurance appraisal will determine the validity of your purchase, as well as the legal ability of the seller to sell to you. The survey of your property will legally establish the boundaries of your ownership.

The builder may owe money on your house

Even a newly built home needs title insurancehttp://heightstitle.com/wp-content/uploads/2018/01/home-needs-title-insurance.jpgIf a builder hasn’t paid their suppliers or vendors, these companies may place a lien against the physical structures. This lien, while against the builder of your house, is still placed on your home. While you may have purchased the home from the builder in good faith, a lien on your property will affect your ability to sell your home in the future.

Mechanic’s liens against your property come from companies such as roofers, electricians, and plumbers. These actually attach to the real estate itself, rather than the builder’s company. When you sell your house in the future, or your heirs do, if these subcontractors haven’t been paid by the builder, it’s your own house that has the unresolved debt attached.

Owner ‘s Title Insurance protects your home forever

While the lender may purchase a Lender’s Policy, that only protects their loan. The coverage for the policy drops as the amount of the loan decreases. A home owner’s title insurance policy, however, is in place for the entire duration of your home ownership, and the coverage won’t decrease unless you personally make changes to the terms of the policy. The bank’s title insurance protects their loan only.

Your personal title insurance will identify any risks before a transaction on your property is completed, and if a claim is discovered, the insurance policy should cover it, along with any court costs and fees.

Options for enhanced insurance

At the time of closing, you’ll pay a one-time premium for your title insurance. You may opt for standard coverage, which protects your house against mechanics liens and the like, as well as your investment. You may also have an option (this varies by state) to purchase enhanced coverage. This protects against undiscovered encumbrances, such as zoning issues, fencing disputes, and even mineral rights. It even protects you, the homeowner, from building permit violations created by your home builder (please note – this doesn’t cover any DIY projects that you complete on the home).

Purchasing title insurance on a newly built home is an added level of protection for one of your most valuable investments. Call Heights Title Services and speak with our team for recommendations. Investing in protection now may save you a lot of headaches in the future.