Real Estate Magazine

West Knoxville Buyers: Do You Need Owner’s Title Insurance?

Posted on the 18 September 2012 by Knoxvillehometeam @KnoxHomeTeam

Keys to Home OwnershipBuying a West Knoxville home is a huge investment. And, during the process, there seems like there are countless costs. There are closing costs, homeowner’s insurance, the down payment, the home inspection, the termite inspection among many others. So with all the costs that come with buying a West Knoxville home, do you need to purchase owner’s title insurance?

As buyer, the decision to purchase owner’s title insurance, also referred to as a owner’s policy, is largely yours. But, as a buyer, prior to making the decision of whether or not to purchase owner’s title insurance for your West Knoxville home, it is important that you understand what an owner’s policy does to protect you and and your West Knoxville home.

Owner’s title insurance protects you against loss resulting from title defects, whether these defects are known or unknown at the time of the sale. A title company will preform a search on the property before closing, not all defects are always found. An owner’s policy will also pays the cost of defending against any covered claim.

So what instances does an owner’s policy cover?

A Basic Homeowner’s Title Policy Will Cover:

  • Someone else owns an interest in your title.
  • A document is not properly signed.
  • Forgery, fraud, duress in the chain of title.
  • Defective recording of any document.
  • There are restrictive covenants.
  • There is a lien on the title due to: (1) a deed of trust (2) a judgment, tax or special assessment (3) a charge by a homeowner’s association.
  • Title is unmarketable.
  • Mechanic lien protection.
  • Forced removal of a structure because it: (1) extends to another property an/or easement (2) violates a restriction in Schedule B (3) violates an existing zone law [deductible and maximum limits apply].
  • Cannot use the land for a Single-Family Residence (SFA) because the use violates a restriction in Schedule B or a zone ordinance.
  • Pays rent for substitute land or facilities.
  • Unrecorded lien by a homeowner’s association.
  • Unrecorded easements.
  • Rights under unrecorded leases.

An Expanded Homeowner’s Title Policy Will Cover [in addition  to what the basic policy covers]:

  • Building permit violations [deductible and maximum limits apply].
  • Compliance with Subdivision Map Act.
  • Restrictive covenant violations.
  • Post policy forgery protection.
  • Post policy encroachment protection.
  • Protection from post policy damage from extraction of minerals or water.
  • Post policy Living Trust coverage.
  • Enhanced access — vehicular and pedestrian.
  • Map not consistent with legal description.
  • Post policy inflation converge with automatic increase in value up to $150% over five years.
  • Post policy protection against adverse possession.
  • Post policy protection from cloud on title.
  • Post policy protection from a prescriptive easement.
  • Protection from covenant violation resulting in your title reverting to a previous owner.
  • Coverage for boundary wall or fence encroachment.
  • Added ownership coverage leads to enhanced marketability.Added ownership coverage leads to enhanced marketability.
  • Added ownership coverage leads to enhanced marketability.
  • Protection from discriminatory covenants.
  • Insurance coverage over a lifetime.

Owner’s title insurance is a one time cost paid at closing that protects your West Knoxville home from unknown title defects for as long as you and your heirs own the property. The cost of an owner’s policy depends on the purchase price and county in which the property is in. To find out how much your owner’s policy will cost, consider getting a quote from the title company you plan on using for the purchase of your West Knoxville.

Are you thinking about purchasing a West Knoxville home? If there is anyway Knoxville Home Team can assist you in your West Knoxville home search, do not hesitate to give us a call. Rick can be reached at 865-696-9002 or via email at [email protected]. Kati can be reached at 865-392-5880 or via email at [email protected].

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