Title Insurance - Is
It Worth the Extra Expense?
Likely, the biggest investment you will make is purchasing a
home. In the State of Georgia, determining the rights and interests to
real property is the responsibility of the
closing attorney who represents the lender.
Let's start with the basics but HANG WITH ME! This gets
really interesting at the end, but I need to review the basics first.What is title insurance?
Title is the paperwork for the ownership of property. Names on
the title change as the property is sold. The title company hired by the
attorney searches the title (or ownership) history of the property. Through its
research, the title company can almost always identify any title problems and
clear up these problems before you close on the property; however, sometimes
they miss something in the chain of title and that is where insurance comes in
play. Sometimes the problems include:
· Defective title —
"Defective title" covers any number of problems with the title to
your home. It can even include a "contested title". Defects are rare,
but they can be very difficult to get rid of, making the property inaccessible,
unbuildable, or unsaleable. Any number of other complex problems define
· Contested title — This happens when
someone who owned or even lived in the home before you claims to still have
ownership. If this happens, the title insurance company will defend your title
and the process will cost you nothing.
REQUIRED: Lender’s title
The lender requires you get LENDER'S title insurance that
protects the mortgage balance.
OPTIONAL: Owner’s title insurance
The OWNER'S TITLE protects your interest in the property and it
can vary in protection and cost. Here is the interesting part for the financially-minded: Attorneys are legally obligated to quote
STANDARD TITLE INSURANCE pricing unless they have permission within their forms
to quote an ENHANCED TITLE INSURANCE.
So I’m guessing you know what form most likely is include in their
Here is the only significant between the
STANDARD TITLE INSURANCE covers the equity between the purchase price
and loan amount at the time of purchase.
ENHANCED TITLE INSURANCE covers the house’s appreciation over a period
of five(5) years up to 150% of face value.
The ENHANCED policy sounds really good until you read that
sentence again. Five(5) years, not 15 years or 30 years, or even 7 years
(the average length of home ownership), is what they are covering extra with a significant jump in price. ASK
and comparison check before you agree to your new policy. If the State requires
STANDARD TITLE INSURANCE be quoted, that might be reason to pipe up
with the questions and shop carefully.
**And here is my
CMA - I am not an attorney and this is not legal advice. If you want more
information about title policies, search up
title insurance companies or get quotes for both policies yourself.
Avoid the Scam
Wire Transfer Fraud: A New
The security of my clients is a top
priority. There continues to be wire
transfer fraud focused on mortgage transactions. Now there is a new twist.
Hackers often attempt to divert closing proceedings from title companies,
attorneys, banks, and Realtors’ email with wiring instruction changes. The
thieves, who compromise buyer and seller email accounts to intervene when a wire
transfer is about to happen, are stealing thousands of dollars through these
wire transfer scams.
There is a new twist in
this – thieves will call the victim first as a cold call notifying them that
there has been a change and to look out for the email with the new
Tips for Buyers and Sellers
Verify Wiring Instructions
Customers receiving requests for changes to the wiring instructions should
verify the change with all of the involved parties using telephone numbers
previously provided. Under no circumstance should wiring instructions be
changed based on a phone call alone.
Do Not to Accept Wiring
Instruction Changes through email
Hackers target emails with wiring instructions. They use the information to
send a modified email with updated directions for wiring money into their
personal account. Never accept directions to modify a wire transfer from any
Watch for Name &
Be extremely wary of wires going to any account that is not in the name of the
escrow company or attorney. Also, be suspicious of any account with a
geographic location different than the seller—and never wire outside of the
United States. There are possible explanations for different names and odd
locations, but ALL red flags should be explored in detail with a phone call to the attorney's office with the number given to you verbally by me, your mortgage officer. It took some time to earn that money. Let's make sure it get to your new home.