Purchasing a home is probably the biggest investment you will make in your lifetime. Before you close, you will want to know that no other individual or entity has a right, lien or claim to the property.
Determining that your rights and interests to the property are clear is the business of a title insurance company.
You pay the title company a single premium which includes the cost of verifying clear title and covers you in case some fault is later discovered in the title.
The title company performs an extensive search on the title history of the property. Through its research, the title company can almost always identify any title problems and clear up these problems before you close on the property.
Real Estate law is extraordinarily complicated. Title companies make sure that all the T's are crossed and all the I's are dotted so you don't end up with a clouded title and legal problems. Your owner's policy will describe the property and outline any recorded limitations on your ownership. It will also set forth the title insurance company's responsibilities should any claim covered by the policy terms arise. Title insurance usually covers:
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