Title Insurance protects against loss resulting from defects of title to a specifically described parcel of real property. In other words, title insurance protects you from another person stepping forward and claiming to own your land or part of your land.
There are many situations that may have been overlooked in the past, such as a break in the chain of title, a tax sale certificate, old mortgages, restrictions, etc.
Title insurance is essential to homeowners today.
Q: Why do I need title insurance? I know I own the property.
R: You may own the property, but the lender doesn’t know that. How does the lender confirm you own the property and what liens attach to the property – title insurance. How does the lender know their investment is secure – title insurance. All lenders require title insurance.
Q: Can I just use my homeowners?
R: No, not at all. Homeowners insurance and title insurance are apples and oranges. Homeowners protects you against damage to your property or if someone is injured on your property. It does not protect you or your lender for claims against the rightful ownership of your property or the liens against the property.
Q: Should I get an attorney?
R: River Edge Title Agency always recommends the use of an attorney when purchasing or selling real estate. However, it is not required in the State of New Jersey to obtain one when buying real estate.
River Edge Title Agency can order your title searches, surveys, payoffs, act as closing agent, prepare closing documents, and issue policies. However, we cannot provide any legal advice.
Q: What is the cost? How is my premium determined?
R: Title insurance is a one-time premium due and payable to closing. The one-time premium covers the owner of the property for as long as he/she owns the property, however, if you refinance, you will need to obtain a lenders policy. The lender requires a first lien position. They insure this by requiring title insurance. Premiums are regulated by the New Jersey Department of Banking and Insurance.
Q: Are there any upfront fees?
R: No you pay the premium at closing along with your other closing costs.
Q: Can I choose my own title company?
R: Absolutely. You have the right to choose your own title company. However, the attorney or lender you work with may recommend a title company. Regardless, the decision is ultimately yours.
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