TITLE INSURANCE IN LOUISIANA
For most Americans, their home is the largest single investment that they will make in their lifetime. Buying title insurance to protect the basic proof of ownership (the title) is a relatively low-cost means of having peace of mind and ensuring that your commercial or residential title transfer is free of any defects.
At Southern Title, we issue a title insurance policy after thoroughly abstracting the property’s history of ownership and transfer at the courthouse.
WHAT IS TITLE INSURANCE?​
Title insurance guarantees that no errors have been made in the title search as well as that there are no errors in the public records.
It also protects against undisclosed title defects that, no matter how thorough a search is made, cannot be discovered from the public records.Â
What does Title Insurance cover?
Title insurance provides the safety net that national lenders require to make mortgages across the country with confidence. Local practices and activities differ across the United States, and any lender that is not familiar with them may be in fact hesitant to make a loan without some type of protection. That is precisely where title insurance comes into play, reducing the risks to everyone in the transaction.
For sellers, title insurance allows quick and easy closings, as they must prove to a buyer that they have title to their house with no liens or other encumbrances. The title insurance process requires a title search and insurance to the buyers in the amount of the sales price, which proves the validity of their title claim with an insurance guarantee.
With an insured property title, potential delays related to passing your property are reduced. In the case of a challenge to your ownership claim, the rights of the insured side are protected even if it means going to court. And if the claim is established, the loss is fully paid up to the limits specified in the policy.
Should a claim be made against your property, title insurance will, according to the terms of your policy, assure you of a legal defense as well as pay all court costs and related fees. In addition, if the claim proves valid, you will be reimbursed for your actual loss up to the face amount of the policy.Â
What is not covered by Title Insurance?
Title insurance provides valuable protection for property buyers. Like all forms of insurance, however, it does not cover every conceivable problem, so it is important to understand its limitations.
Title insurance is based on examination of the county real estate records, and generally will not cover problems arising from facts outside of the recorded chain of title. One common problem not covered by title insurance is boundary line issues, which would be revealed by a survey of the property (for example, it turns out that your fence is actually two feet onto your neighbor’s property). Unrecorded mechanics’ liens and unpaid public utility bills are other examples.
The title insurance policy will describe many of the situations it does not cover, and these same limitations will generally be found in an attorney’s title examination. A qualified real property attorney can assist in helping a buyer understand the limits of a title policy and can take care of issues not covered by the policy.Â
TITLE INSURANCE IS AN EFFECTIVE SOLUTION
- Fraud or duress in obtaining signatures.
- False impersonation of the true land owner.
- Probate matters.
- Errors of recording officials such as errors in tax records.
- Mistakes and omissions resulting in improper abstracting.
- Misrepresentation of marital status.
- Deeds by a corporation without proper legal authority.
- Deeds and wills by minors or persons of unsound mind.
- Homestead rights of a spouse/rights of divorced parties.
- Forged signatures, deeds, mortgages, wills, releases and other documents.
- Forged conveyances by undisclosed divorced spouses.
- Deeds by persons falsely representing their marital status.
- Undisclosed heirs.
- False affidavits of death or heirship.
- Delivery of a conveyance after the death of the grantor.
- Adverse possession.
- Forfeitures of real property due to criminal acts.
- Defective acknowledgments due to improper or expired notarization.
- Documents/instruments executed under expired or revoked powers of attorney.
WHO DOES TITLE INSURANCE PROTECT?
Title insurance protects both lenders and real estate owners against various types of damage that can occur. It is important to note that title companies generally issue two types of policies at the time of purchase for a modest, one-time premium.
Lender’s insurance – covers the bank, savings, and loan or other lending institution over the life of the loan.
Lender’s policy, also known as a loan policy or a mortgage policy, protects the lender against loss due to unknown title defects. It also protects the lender’s interest from certain matters which may exist, but may not be known at the time of the sale. This policy only protects the lender’s interest. It does not protect the purchaser. That is why a real estate purchaser needs an owner’s policy.
In case you are considering refinancing your mortgage, you will be required to purchase a new lender’s policy of title insurance. And the reason for this is because a lender’s policy only provides coverage during the loan term. In other words, when a home is refinanced, one loan ends, and the next begins. Therefore, you will be required to obtain a new lender’s policy for the title.Â
In case you are considering refinancing your mortgage, you will be required to purchase a new lender’s policy of title insurance. And the reason for this is because a lender’s policy only provides coverage during the loan term. In other words, when a home is refinanced, one loan ends, and the next begins. Therefore, you will be required to obtain a new lender’s policy for the title.
Owner’s insurance – covers you, the homebuyer.
The owner’s policy protects the purchaser against a loss that may occur from a fault in the ownership or interest you have in the property. You should protect the equity in your new home with a title policy.Â
An owner’s policy lasts for as long as either you or your heirs hold an interest in the property. For that reason, there is no need to buy a new owner’s policy when refinancing a home.
BUYING TITLE INSURANCE
There is no requirement to buy title insurance. But, realistically, most mortgage companies, banks, and credit unions will require title insurance to protect their interest in the property.
However, it is recommended that you do purchase title insurance unless you have fully investigated the condition of title and are willing to accept the property with the liens and restrictions shown.
Title insurance rates in Louisiana are regulated by the state’s insurance commission and will not vary from one title company to another. However, slight variations in a title insurance quote can occur if a lower degree of coverage is offered. Premium amounts are based upon the purchase price and loan amount of the mortgage.
TITLE INSURANCE SERVICES IN LOUISIANA​
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