By now you probably have been told many times of the value of purchasing an owner’s title insurance policy to protect your property rights. However, you may be wondering what a real life title problem that was covered by title insurance looks like. Here are a few examples of real situations where title insurance protected the homeowner.
A couple purchased a home from their landlord, who had taken out a $419,000 loan to purchase the property along with several other properties. The lien was missed during the title search, so the lender paid the landlord instead of paying off the lien. Despite making their payments, the bank sent a letter saying the home would be auctioned. Because the couple purchased an Owner’s Title Insurance Policy, the title company paid the lien and the husband and wife kept their home.
A Texas-based builder sold first-time homebuyers houses that were encumbered by undisclosed liens. When Casa Linda Homes subsequently failed to pay its undisclosed debt, the creditors who were owed money then instituted foreclosure proceedings or filed lawsuits against the homebuyers. Because the deals were “seller financed,” the builder didn’t require the buyers to purchase title insurance, which would have protected the buyers.
In Virginia, properties were sold to unsuspecting buyers. Unfortunately, the sellers weren’t the rightful owners of the properties. Instead, death certificates of the real owners were falsified and the fraudsters appeared at settlement to sign the closing documents. The criminals were caught and the properties were returned to the rightful owners. But what about the unsuspecting buyers? If they had purchased an Owner’s Title Insurance Policy they would have been covered. However, if they weren’t properly advised to protect their investment they would not have only been without a home, but also lost their entire down payment.
Issues just like these also occur in South Carolina. Remember, if your client asks should they purchase an owner’s title policy the answer is always YES!
OPEN HOUSE: Please join us Tuesday, July 25 from 11:30 am to 1:30 pm for the Grand Opening of our Greenville Office located at 406 East Bulter Road, Mauldin, SC. We will have food, drink and prizes! Hope to see you all there.