Owners title insurance can be bought when buying or refinancing a property. It only needs to be bought once by an owner and will cover title issues for the entire time that they own a home. Understanding what title issues are may help homeowners decide whether to purchase a policy. What are title defects in NH can be found below.
What Are Title Defects
Title issues are not common but they can have a dramatic impact when they do arise. Defects are conditions that call into question the legal owner of a piece of real estate. Although a title search is completed before most homes are purchased, many problems are not obvious and therefore can be unknown for several years and across several title transfers. Any found defects must normally be addressed before the completion of a sale, but in cases where they are not detected, title insurance protects the buyer of the home.
Title Issues Covered by Title Insurance
Title defects come in a wide range of scenarios. Below are just a few examples (keep in mind that this will differ by insurance company).
- Missing Signatures
- Unknown Liens
- Unrecorded Releases
- Failure to Observe Proper Recording Rules
- Undocumented Encumbrances
- Undisclosed Heirs
- Mental Incompetence of a Signing Party
- Name Confusion
- Problematic Deeds
Why Buy Title Insurance
If you bought an owners title insurance policy, the insurance company may either resolve the problem or reimburse you for losses you incur. It may even cover defending a law suit threatening your ownership rights. Policies are purchased for a specific value, so maximum limits do apply. Also, certain issues may be exclusions on your policy. Ask your closing agent for a full list and for more details on what are title defects in NH. In the End, title insurance is the best protectopn of your ownership rights to a property. Although the cost can be significant, it is assessed only one-time and covers you and your heirs for as long as you maintain ownership. It is certainly worth the expense given that a home can be the biggest investment that you make.