Frequently Asked Questions
Why do I need title insurance?
When you purchase personal property such as a car, jewelry or a television, it is not necessary to know whether or not the former owner is married or divorced. Or whether the previous owner has unpaid taxes or child support. But, when you buy real estate….a house….a building….or even vacant land, it is vital that you know these things --- and many others, too. You must have a complete examination of the “chain of title” to this real estate, or you may discover that the property you have bought and paid for is not actually yours at all. Even the most thorough of title examination cannot protect you against lost from hidden title defects. Your title insurance policy will protect your from many of these defects that do not appear in public records to the extent not otherwise indicated in the Policy.
What is an example of a “hidden defect” covered by an A.L.T.A. Title Insurance policy?
There are many examples of this coverage. A few of the more common defects are as follows:
- False impersonation of the true owner of the land.
- Forged deed, release of mortgage and other instruments.
- Deed by a minor.
- Federal Estate and gift tax liens
- Undisclosed heirs
- Mistakes in recorded legal documents.
A chain of title is the written, recorded, history of a parcel of real estate. The county records are kept in a chronological index. Title researchers compile this history in a concise “chain of title” that can be reviewed by a licensed examiner, in search of defects. The records for the chain are not limited to documents found in the Register of Deeds Office, but also include evidence found other public offices, such as the District Court.
Doesn’t my deed take care of giving me clear title?
Not at all. A deed is merely an instrument whereby a seller transfers his or her right of ownership, whatever that may be, to you. It is not proof that the person described as the seller is actually the sole owner. It does not clear any claims or rights others may have in the property. From only reviewing the deed, you cannot determine what rights, liens or claims might be outstanding against your title.