What is Title Insurance?
Title insurance is a unique form of insurance. It provides coverage for future claims or future losses arising from unknown or undisclosed title defects which are created by some past event (i.e., event prior to the acquisition of the property.) These title defects remain attached to the title to the property that you are buying until they are extinguished.
In the event of a covered matter affecting your title, your title insurance policy may protect you in various ways including: (1) Defending your title, (2) Bearing the cost of settling the covered matter, or (3) Paying you for the loss due to the covered matter.
Why do you need Title Insurance?
You need title insurance to protect possibly the most important investment you’ll ever make - the investment in your home. With a title insurance policy, you as owner, have an indemnity contract that will reimburse you for loss in the event someone asserts a claim against your property that is covered by the policy. This means that you have the peace of mind in knowing that the investment you’ve made in your home is a safe one.
What is an Owner’s Policy of Title Insurance?
Owner's title insurance is usually issued in the amount of the real estate purchase. Only Owner's title insurance fully protects the buyer should a problem arise with the title that was not uncovered during the title search.
What is a Loan Policy of Title Insurance?
The Loan Policy is issued to your lender when they give you a loan and record a mortgage against your property. It is usually based on the dollar amount of your loan. It protects the lender’s interests in the property should a problem with the title arise. The policy amount decreases each year and eventually disappears as the loan is paid off.
What is a Title Search?
A title search is a diligent search of the public records for those documents associated with the property. An examination of these records can determine if there are any rights or clams that may have an impact upon the title to your property.
The title search may reveal the existence of recorded defects, liens or encumbrances upon the title such as unpaid taxes, unsatisfied mortgages, judgments and tax liens against the current or past owners, easements, restrictions and court actions.
What is the Premium for Title Insurance and how much does it cost?
The premium for title insurance in the State of Florida is called the “Promulgated Rate.” The cost of the title insurance policy depends on the sales price of the real property. The minimum rate established by the State of Florida is $5.75 per thousand up to $100,000.00, and $5.00 per thousand thereafter (up to $1,000,000.00)
Unlike other forms of insurance, the original premium is your only cost as long as you own the property. There are no annual payments to keep your Owner’s Title Insurance Policy in force.
What is a Reissue Credit?
The title insurance underwriting guidelines will determine if you are eligible for a reissue credit. It is a cost savings on a title insurance premium given in a sale/purchase or refinance transaction when a prior owner’s policy of title insurance insuring the current owner or borrower is given to the title agent.
What is a Municipal Lien Search?
A municipal lien search allows you to find unrecorded liens, in addition to code violations, municipal special assessments, utility charges, and open or expired permit issues that are associated with residential or commercial real estate.
What is an Estoppel letter for an HOA or Condominium Association?
In Florida, association unit or parcel owners are jointly and severally liable with the previous owner for debts on the property. Therefore, when somebody buys an association property they need to know how much is owed at a given time so that amount can be collected and applied at closing. An estoppel letter is a certificate, signed by either an officer or authorized agent of the association that states what amount is owed through a given date.