If you’re buying a new home in Florida, then you need title insurance to protect you for years to come from potential title defects. Old forgotten owners, claimants or tax bills regularly come back to haunt people who overlook title insurance.
Here’s a 101 overview of why you need title insurance for your new home in Florida.
What is Title Insurance?
Title insurance is a specialized type of real insurance that protects property owners and lenders from financial loss caused by title defects or any other issues during a real estate transaction.
Think of it like a one-time fee safeguard, used to protect you from any disputes or claims that impact your rights to your property – including those that could have existed long before the purchase.
The most commonly used type of title insurance is ‘lender’s title insurance’, where the borrower purchases the insurance to protect their lender.
There is also, ‘Owner’s Title Insurance’, usually paid by the seller to protect the buyer.
How Title Insurance Works:
To legally own a property via a real estate transaction, the title must be clear of any disputes or ownership claims. To reveal these ‘defects’, the title company should complete a title search before the title is issued to the new owner. That search sees the title company scour public records to reveal any outstanding liens or claims, such as debts, part owners or unresolved building code violations.
If these problems are revealed, the potential new homebuyer could face losses or damages. To overcome this, title insurance can be used to protect against:
- Ownership claims
- Incorrect or invalid signatures on documents
- Forgery and fraud
- Flawed records
- Unrecorded easements that could negatively impact property value or use.
- Encumbrances or judgments (including, outstanding lawsuits and liens)
Why Do I Need Title Insurance for My New Home?
If you don’t have title insurance for your new home, you expose yourself to a significant risk of loss or damage should a title defect be revealed.
If, for example, a prior owner has left unpaid property taxes, it would be you (the new buyer) who has to pay for it. If you can’t pay it back, you risk losing the home to the tax entity. But with title insurance, you’ll have coverage to pay it off.
This is just one example, as title insurance will also cover many other defects. Here are some common examples:
Protection Against Title Defects:
- Title insurance will protect you against title defects, such as undisclosed heirs, errors in public records, forged documents or improper document recording. If any claims arise in the future, you will be covered.
- Your lender may require you to purchase title insurance to protect their financial interest in the property. If you don’t have it, you may struggle to get lender approval.
Transfer of Ownership
- By having title insurance, you will enable a smooth transfer or ownership.
- The property title will be clear and marketable, allowing for a smooth purchase and ownership over the long term.
Coverage for Legal Expenses:
- If a title claim arises, then having title insurance for your new home will cover the costs of resolving the claim and legal expenses, such as:
- Attorney fees
- Court costs
- Any other expenses related to the defense of your property ownership
Peace of Mind:
- When you buy a new home, it’s likely a dream come true. By having title insurance, you keep that dream free from unexpected legal disputes that could turn it into a nightmare.
- You won’t need to worry about the implications of an unexpected claim or dispute in the future, as your title insurance will protect you.
Read Related: These Title Issues Could Ruin Your Real Estate Closing!
How a Florida Real Estate Lawyer Can Help You With Title Insurance for Your New Home:
A Florida real estate attorney can conduct a title examination to reveal any issues or defects in your new home’s title. They will go through the public records, judgements, liens and more to ensure the title you receive is clear. This is a process that can only be completed by a well-trained and qualified professional.
Title Insurance Policies:
A reputable Florida real estate attorney can help you obtain the optimal title insurance for your new home. Working with trust title insurance underwriters, your attorney will guide you to coverage that protects your present and future.
Resolution of Title Issues:
If a title issue or other defect is revealed on your new home, our Florida real estate lawyers will work fast to resolve them, guiding you through the legal process and protecting your interests.
Expert Legal Advice:
Title insurance, title searches and title issues don’t need to be super complicated, but without expert guidance they often are. We will give you peace of mind, by making complicated topics easy-to-understand, so you understand what you’re investing in.
This will keep the process smooth and ensure your new home is secured without drama – from communication to documentation.
How Can I Buy Title Insurance in Florida?
To buy title insurance for your new home in Florida, you must pay a one-time fee. Owner’s title insurance varies from $500 to $3,500 (depending on the type of insurance and price of your home). Many lender’s policies and owner’s policies are required together.
Once the property purchase agreement is complete, your closing agent, attorney or escrow agent will initiate the insurance process.
We can assist you with acquiring title insurance for:
- Leased properties
- Rental units
- Rural properties
- Vacant land
What Types of Title Insurance Are There?
- Keep the lender’s investment in your property safe against title complications. This does not protect you, the buyer, but may be requested by your lender.
- Offers coverage so long as you, and your heirs, have interest in your home.
- Title insurance is available for residential properties and commercial properties.
Contact a Residential Real Estate Closing Lawyer in Pinellas County, FL
If you want to get title insurance for your new home in Florida, or need any legal assistance when purchasing a new property, then our Florida real estate lawyers for title insurance can help.
Our experienced and award-winning lawyers can guide you through the process, ensuring your dream purchase remains exactly that. We can also coordinate, prepare and complete documents related to the title, deed, transfer, and loan acquisition.
If you’re selling property or land in St Petersburg or Riverview, Florida, contact us today.
Our St Petersburg & Riverview real estate attorneys have extensive experience that can help you through these tricky moments, reviewing your contract, advising you on the next steps to secure your transaction, and successfully finalizing the sale of your home or commercial property.
Contact us today to schedule a free consultation.