Florida Buyers Need Owner's Title Insurance to Protect Their Property Rights
There are two major categories of title insurance; lender's title insurance and owner's title insurance. While a lender's policy, which is typically required in order to close a loan, can protect your lender-- it can't protect you. That's why most financial experts recommend that anyone purchasing property take out a comprehensive owner's title insurance policy.
How Owner's Policies Can Protect You From Serious Title Problems
In general, owner's title insurance policies are designed to protect the you, the property owner, from issues or errors related to your property's title. These, in turn, could have a serious impact on your ability to actually 'own' the property, should a competing legal claim to it arise.
There's NO need to Lose Your Shirt In A TItle Dispute
If the title to your property is legally threatened, and you have a functional owner's title insurance policy, it will protect you for the full price you paid for the property. Plus, the owner's policy will pay your legal costs in order to dispute the ownership issue in court. That way, you're not financially responsible for having to defend your ownership stake in your own property.
The Most Common title issues Affecting Florida property owners
Some of the most common title problems that are likely to affect you (and that title insurance protects against) include:
- Title recording errors
- Unknown liens, including:
- Tax liens
- Mechanic's liens (some policies protect against this, some don't)
- Association liens
- Marital liens
- Incorrect legal property description (on deed)
- Survey/boundary disputes
It's essential to remember that, even if your property has gone through an extensive title search and verification process, a title issue could still arise at any time. And, if you don't have title insurance, you could be incredibly vulnerable. That's why it pretty much always pays to be prepared by making sure that your property has the protection that it needs.
How Much Does Owner's Title Insurance Really Cost?
Unlike lender's title insurance, which is calculated based on the size of the loan, owner's title insurance is usually calculated based on the purchase price of the property. In many states, standardized rates per $1,000 will be issued by the state government or a state insurance office, while in some states, title companies generate the rates themselves, which can lead to significantly greater price variations. In Iowa, the state government actually issues title insurance itself, which has lead to some of the lowest rates in the entire country, at around $110 for a $500,000 property.
owner's title insurance: WHO PAYS FOR IT?
Depending on the customs in the state and county in which you're buying property, either the buyer or the seller may pick up the tab on the owner's policy. Therefore, it's a good idea to check with your real estate agent and your title company to determine which party is typically responsible. Remember, everything in real estate is negotiable, so even if the buyer is usually responsible, they may be able to convince a seller to pay, especially if the seller is particularly eager to close the deal.
Want an Extra Layer of Protection: Here's How to Get More Title Coverage in Florida?
While most title insurance policies are pretty comprehensive, they don't cover everything-- and, if you want additional coverage, you can often purchase it in the form of a title insurance endorsement. One common endorsement covers mechanic's liens (claims filed by unpaid contractors), since not all policies protect against this. Other common endorsements cover survey, zoning, and land access issues, which may be especially important for those buying commercial properties and those looking to make improvements upon raw land. In addition, you may want to consider getting an enhanced owner's policy, which, while somewhat more expensive than a standard policy, can also extend your coverage.
To learn how to save on owner's title insurance-- and to make sure you have enough coverage, simply contact the experts at Florida Title Company today for a free consultation.