The most significant part of buying a house is finding a title defect. Title defects come up when there are tax liens and restrictions that limit the use of the land. To purchase a real estate it is important to obtain a Title Search on the property that will reveal any of those encumbrances. Title Abstractors perform the Title Search before the closing transaction.

In-spite of the time and expertise that goes into a Title Exam, even the most detailed search cannot assure that there are no hidden title defects. Such title defects may leave the Buyer with an unpleasant and costly alteration, or even worse, the Buyer may lose his house and be left with financial compels to the Lender.



Another common title defect is when a grantor is not competent to sign the deed . Other common title defects include fraud, forgery, defective deeds, or any kind of clerical error. All these hidden defects can arise after the Buyer purchased his home and may jeopardize his authorized possession.

The only way to safeguard the ownership is to get Title Insurance. It is important for both, the homebuyer and the Lender. If the property is financed, the Lender will usually require a Title Search and to get an Insurance before providing a Buyer with a housing loan. This is the only way for Lenders to protect their own financial interests in the property.

For the Buyer, it is a covering against personal loss due to potential problems with title. By obtaining this the Buyer invests in a long term peace that the newly purchased home is free of any liens, encumbrances,judgments, and other related title defects.

Even though the risk of loss is high, the Buyers are not required to get Title Insurance. At every real estate closing deal the Buyer would hear a counsel say “ Insurance against title is optional,” and despite this advice some Buyers claim Title Insurance.

It is responsible for paying legal costs when it is needed to defend the Buyer against any legal proceeding invading his title. This will also pay to clear up the title problems or pay for the Buyer’s loss of money.

Title Insurance is, in fact, very low-priced. It is a one-time payment that is usually collected at the time of the closing procedure, but it remains in effect as long as the Buyer and his heirs have interest in the respective property.