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[A509]American Title Insurance Co

by Brandon Cornett, Bra

What's a Title?
A title is a written document that shows ownership of property. It includes the signatures of current owners and a legal description of the property. A title is also known as a deed.

Before you close on a new home, a title examiner will conduct a title search. This is a review of public records and legal documents to ensure that the seller is the true, legal owner of the property, and that there are no unsettled claims or liens against the property.

What is Title Insurance?
Title insurance protects the lender (and possibly the homeowner) against losses that might arise from property ownership disputes. The importance of title insurance can best be illustrated through an example:

Let's assume you're buying a house, and that the title search comes up clean. So you close on the house and move in. Two months later, a relative of the former owner shows up at your door, claiming that they were part owner of the property, and that they never surrendered or signed away their ownership.

This is an ownership dispute, and it could mean you'll have to go to court to defend your ownership of the property. If you have title insurance, it will likely cover your court costs.

Let's further assume that the former owner's relative was telling the truth. This means the title examiner overlooked a defect or "cloud" on the title. Somewhere along the line, ownership of the house was not properly transferred. It's not your fault, but you're still caught in the middle.

In the event that the court rules in favor of the former owner's relative, title insurance again comes into play. Title insurance will see to it that the lender is repaid for the mortgage loan, and that you are repaid for your investment in the property (up to the maximum amount allowable under the policy).

Your mortgage lender will require you to take out a title insurance policy in their name. This protects their financial interests, and it will most likely be mandatory. But the title insurance that protects you can be purchased separately, and in some cases you'll be able to choose whether or not to buy it.

If the lender requires that you take out a policy in both their name and yours, then you have no decision to make. But if your own coverage is optional under the lender's rules, you have to make a decision.

Personally, I think title insurance is a relatively inexpensive purchase, given the peace of mind and protection it affords. I'll always purchase title insurance when buying a house.

Lastly, keep in mind that title insurance only protects you against title errors that were made before you closed on the house. Title errors that take place after you close on the property will not be covered a title insurance policy.

* Copyright 2006, Brandon Cornett. You may republish this article in its entirety, provided you leave the byline, author's note and website hyperlink intact.

Risk- the one word that is directly related to the commercial real estate industry. With the element of ?buyer beware,? the fact that the purchaser is completely responsible for the facts of a property before agreeing to a contract. There are so many opportunities for something to go wrong; you must rely on commercial real estate professionals and companies to look out for your best interest and the interest of your investments.

When entering into a contract, and closing a deal, your assets and future profits are at stake, especially if any of the information you and your team has gathered is erroneous. With the use of escrow companies, lawyers and title insurance, your dealings can go smoothly and the property can follow through with the original strategy that you attend for the property.

Escrows are simply an arrangement where a third party holds the necessary documents, funds, or other properties to be transferred between two parties. The third party does not transfer anything until they are instructed to do so by each party and they have the necessary documentation stating that each party is in agreement with terms and everything is set for escrow to be closed- or the properties transferred from one party to the other.

In a commercial real estate transaction, the third party can hold documents from the buyer, the seller, and funds from the commercial lender. When the parties are in agreement, the escrow agents simply make sure that all items are distributed properly and into the correct hands. This saves the buyer, seller or lender from having to worry that one of the parties will not transfer the funds or other documents. Every party is protected because the proper forms are in the hands of the escrow agents with no personal investment in the deal. Every party can count on receiving the properties that were previously agreed upon in the contract.

If there is no escrow, there is room for a dishonest buyer or seller to either not transfer the proper documents or funds and get away or have some excuse as to why he or she is not delivering what was promised on the previous contract. Or perhaps they could show an overlooked conditional clause that allows them to alter from the stated claim and agreement.

Escrows can be companies within themselves, lawyers or title companies. Some investor have companies or people that they work with all the time, and they insist on using those people or companies because they know they have no personal interest in the deals. There can be fraud that occurs where an escrow company or agent secretly has interest in the deal and can play the deal in the person's favor- with the buyer or the seller, whomever they are working with.

Always be sure to check the references of the escrow company or agent before agreeing upon a third party. For those people who will only use their company, make sure the company is reputable before conducting business.

Title companies are companies that specialize in researching public records to determine the status of a title to a specific property. The purchaser must find out if there are any liens or encumbrances on the property before purchase so the matter can be resolved before purchase by the seller.

Entire reports can be made regarding title of real property transactions which is used to issue title insurance. A title report is pulled at the beginning of escrow so the buyer can see the full status of the title of the property. This first or preliminary report then becomes a final report when title insurance has been issued. Title insurance protects the buyer from wrong information. The title company does not guarantee or otherwise have a law that surrounds the fact that their information on the title report was not accurate.

Title insurance is not necessary. The parties may choose to forego the insurance (which it is customary for the seller to pay) and incur the risk of the transfer of the property. This is not recommended for those who do not know each other well or have full trust in all parties involved.

If you seek longevity in the commercial real estate industry, protect your interests and your assets by the use of professionals. It is imperative that you rely on these professionals to makes sure all your intentions and dealings come through exactly as planned.

You can make this as secure as possible with every deal so your profits are maximized and there are no surprises down the road.

Article Source : Texas Real Estate Information

About Author

Both Brandon Cornett & Tony Seruga, Yolanda Seruga And Yolanda Bishop are contributors for EditorialToday. The above articles have been edited for relevancy and timeliness. All write-ups, reviews, tips and guides published by EditorialToday.com and its partners or affiliates are for informational purposes only. They should not be used for any legal or any other type of advice. We do not endorse any author, contributor, writer or article posted by our team.

Brandon Cornett has sinced written about articles on various topics from Realestate Marketing, Home Buyers Guide and Real Estate. . Brandon Cornett's top article generates over 4400 views. to your Favourites.

Tony Seruga, Yolanda Seruga And Yolanda Bishop has sinced written about articles on various topics from BMW, Real Estate and Real Estate. Specializing in commercial and investment real estate, Tony Seruga, Yolanda Seruga and Yolanda Bishop are always searching for new and profitable commercial properties across the U.S. Visit. Tony Seruga, Yolanda Seruga And Yolanda Bishop's top article generates over 1000000 views. to your Favourites.