is Title Insurance?
Insurance protects you, the owner of property, and insures that
you are the rightful owner of
Your property, and that there are no liens or other encumbrances
affecting your property that
could result in financial and tangible losses to you. In other words,
nothing exists that could
devalue your property by forcing you to pay for things that should
have been paid for by prior
owners, or by limiting your ability to use your property as you
there are two types of title insurance policies. The Owner's Policy
is designed for the
owner of property; and the Lender's Policy is designed for mortgage
companies, or banks which
lend money where the property is used as collateral. In addition
to insurance that an owner is the
rightful owner of a property and that there are no liens or encumbrances
against the property, the
lender's policy covers the lender for monetary loss they may incur
if their mortgage lien does not
hold the priority position it intended to hold.
does one obtain title insurance?
to issue title insurance, title companies require that a title search
of the property be
performed. Every document that is created which affects property
is presumed to be recorded at
the Recorder of Deeds Office (sometimes referred to as Land Records,
or Public Records) of the
Court House in the county where the property is located. A title
search is the collection of all the
documents that are recorded at the Recorder of Deeds office which
affect title to a particular
the information acquired in the title search, a Commitment for Title
Insurance is prepared.
The Commitment is a commitment to insure apiece of property, subject
to certain conditions that
will have to be taken care of prior to or during settlement.
Policy of Title Insurance is available for anyone who purchases
property. It is not
mandatory, but it is recommended. Most commercial lenders will require
a Lender's Policy in
order for them to lend money for the purchase or refinance of property
.It is the buyer's or
borrower's responsibility to purchase the Lender's Title Insurance
Policy, whether or not an
Owner's Policy is purchased.
much does title insurance cost?
rates paid for title insurance are based upon the purchase price,
or loan amount, which
will be the amounts insured on the policies. In Pennsylvania, the
rates for title insurance are
standard rates, regulated by the Insurance Department of Pennsylvania.
Rates are filed on an all
inclusive system, which means they include not only the cost of
the title insurance premium, but
also the cost of the title search and the closing, or settlement
fee. We can provide coverage to you
under several different fee arrangements.
is closing, or settlement?
you purchase property, initially you sign an agreement to purchase
the property. Once that
Is done, all the inspections, loan application and approval process,
appraisal and all other
Documentation must be collected. When that has all been done, you
are ready to go to settlement
On the property. Settlement is the time you sit down with the sellers
of the property and sign all
the final documentation transferring the property to you. It is
also the time the sellers hand you
you refinance, initially, you will apply for your new mortgage.
Inspections, appraisal, loan
approval and all other documentation must be collected. When that
is complete you are ready to
go to settlement. At settlement you sign all the final loan documentation
for your new loan.
is the role of the title company at settlement?
company coordinates all the documentation that needs to be signed
at closing. They
make sure all the required items shown on the Title Insurance Commitment
have been taken care
of. They sit at the table with you and explain to you the documents
you will be signing and
answer any questions you may have. They are also responsible for
all the money that exchanges
hands between the buyer, seller and lender and they pay all bills
associated with the transaction.
settlement is complete the title company will make sure your new
documents are recorded
at the Recorder of Deeds office. After they have been filed, the
original documents will be
returned to the title company. The title company will produce the
Title Insurance policies and
forward them to you, or your lender, along with the original recorded
do I select a title company?
property, federal regulations mandate that it is the buyer's choice
their settlement. Because rates and fees are mostly the same no
matter what title company you
select, you should select a title company you feel comfortable with,
a title company you can rest
assured will do everything the right way to protect you.
Do I need an attorney?
Abstract recommends that if you would like an understanding of the
legal obligations created by the documents that you are signing
at settlement, you should contact an attorney experienced in the
field. Freeland Abstract recommends the law firm of Keenan,
Ciccitto & Associates as a local firm experienced in real