Title Insurance

Title Insurance is the key to protecting your home.

An Owner's Title Policy provides you with peace of mind. It takes the risk out of acquiring property whose legal history is unknown to you. While, ideally, there should be no risks in acquiring property, they do exist.

Throughout the years, your new property may have changed hands many times through sale, inheritance, foreclosure or bankruptcy. Each transfer was an opportunity for an error in title to arise. If an error occurred, and has never come to light, it puts your title in jeopardy.

Before an Owner’s Policy is issued, SDS Title conducts a search of public records and related documents. Besides describing your property and spelling out any recorded limitations on your ownership, a title insurance policy sets forth in clear terms what the Insurer will do in the event that a flaw in the title is discovered or your rights of ownership are challenged. In simple terms, the insurer agrees:

1. To defend your title in the courts, as insured, at its own expense.

2. To correct or clear the title when possible.

3. To promptly pay you for your loss in the event of an unsuccessful defense of your title.

Let us protect you and your investment!

Unlike other forms of insurance, title insurance emphasizes loss prevention for the insured. Title professionals perform the labor-intensive work to find and address title issues that could threaten homeowners and lenders. This upfront analysis results in fewer claims and gives policyholders the peace of mind that their title risk has been effectively reduced. In contrast, insurance based on loss assumption (such as auto or property and casualty insurance) requires little upfront work because claims cannot be predicted or prevented, and premium funds are needed only in the event of an accident or other covered issue. These types of insurance also require annual coverage payments, unlike title insurance which is paid for only upon the purchase of the house or establishment of a new mortgage.

Advances in technology are helping to streamline the title search process. Our underwriter, First American Title Insurance Company, continues to make investments in “title databases,” where documents from the public records are organized and centralized. Yet, even with these advances, technology cannot fully automate the title process given the need to analyze and interpret the information, to correct title defects, and the fact that many county recorder offices still maintain only paper records. These and other functions require the skill of highly trained professionals. The development of automated title processes will continue as title insurers focus on improving the quality of service while reducing costs.

Although an Owner’s Policy of Title Insurance lasts for as long as the homebuyers own the property, a Loan Policy protects the lender’s investment only for that particular loan. When refinancing, homeowners obtain a new loan and expose their new refinance lender to new risks. Title risks for refinances include other mortgages, mechanics’ liens, liens from unpaid taxes, divorce and remarriage, bankruptcy, etc. The lender (even if the same lender is used) will require a new title insurance policy to protect against those risks.

Title insurance is necessary on a newly constructed home even though the home itself has no title history. This is because title risks may result from actions that occurred before the new home was built. Also, the builder or developer may have created title risks, such as liens from unpaid subcontractors, tax assessments, bankruptcy proceedings, or a delinquent loan balance on the property. Title professionals help uncover and address these issues upfront, and an Owner’s Policy protects the homebuyer after they move into their new home.

If you financed your new home, your lender most likely required

that a Loan Policy of title insurance be purchased; however, a Loan

Policy only protects the lender. An Owner’s Policy of title insurance fully

protects you, the homeowner, from problems that were not uncovered

during a title search, and pays for any legal fees involved in defending a

claim against your title to the property. For a one-time premium fee, an

Owner’s Policy provides this coverage for as long as you or your heirs

own the home providing the best protection and ensuring your

peace of mind.