What does title insurance mean in the USA?

23rd July, 2014
  • Title insurance is one of several insurance policies you are likely to find yourself taking out when you purchase an the USA property, and possibly the most important one. This type of cover is fairly common within US property transactions and provides protection against any issues that may threaten your legal ownership of the home.

    There are two types of title insurance policies: owners and lenders insurance. The first kind is applicable to you as the potential buyer of the home.

    According to US real estate law, when you purchase a property, technically you aren't buying the actual home itself or the land it's built on. You are in fact buying the title to the property. The title gives you the right to occupy the home and to use that space as you see fit. The process is similar in some respects to buying a leasehold property in the UK.

    Sometimes the title of the property will contain defects, which could affect your ownership of the property and, if it's to be used as a rental, the right to any income you receive from it. 

    Another party may have a claim to the property or the land it's built on. For example, a previous owner may have had an undisclosed heir who, by law, has the right to occupy the home. Another scenario is that a previous owner of the home may not have kept up to date with local property taxes' leaving you liable as the current owner.

    Prior to the closure of the sale, your insurer will undertake a title search on the property, which means checking with the public records office to unearth any issues relating to the title. If the title of the property is 'clean' they will insure you against any further complications that might ensue.

    Buying title insurance is part and parcel of the US homebuying process and we would always advise that you take out a policy and have it in place at the time of closing, along with any other insurance covers. 


    by: Prime Asset Investments

Comments (0)

Recent Q&A

Featured Posts

  • product HOUSING MARKET CONTINUES GRADUAL CLIMB BACK TO NORMAL IN USA

    According to the NAHB/First American Leading Markets Index, markets in 146 of the approximately 340 metro U.S. areas nationwide returned to or exceeded their last normal levels of economic and housing activity in the second quarter of 2016. This represents a year-over-year net gain of 66 markets.

    9th August, 2016
  • product ZIKA VIRUS MAY AFFECT PROPERTY VALUES IN PARTS OF MIAMI

    Miami's trendy Wynwood neighborhood, which experienced a huge boom in property values over recent years, now faces a tremendous amount of fear and uncertainty as a result of the arrival of the mosquito-borne Zika virus says Barry Sharpe, who heads Miami-based Property Tax Appeal Group.

    9th August, 2016
  • product NEW HOME SALES IN U.S. REACH HIGHEST LEVELS SINCE 2008 MARKET CRASH

    According to the U.S. Department of Housing and Urban Development and the U.S. Census Bureau, sales of newly built, single-family homes in the U.S. rose 3.5 percent in June 2016 from an upwardly revised May 2016 reading to a seasonally adjusted annual rate of 592,000 units. New home sales are up 9.3 percent in the second quarter of 2016 from the first quarter.

    28th July, 2016