Alabama Title Company
If you plan on purchasing a home soon, it is important to get in touch with an Alabama title company promptly. They can assist you with purchasing title insurance. Here are common myths about title insurance that you should not believe.
Title insurance isn’t necessary if you have home insurance
While it is certainly important to have adequate home insurance, it will not replace title insurance. Home insurance and title insurance cover completely different things. Home insurance protects against damage to the actual property from fire, vandalism, storms and other disasters. Title insurance, on the other hand, covers issues that occurred before you bought the home, such as liens, forgery and easements.
Title insurance requires monthly payments
Title insurance is different from other types of insurance. Most insurances require you to pay a monthly premium while title insurance does not. You just have to make a one-time payment at closing. After that, you do not have to worry about it again.
Title insurance isn’t worth money
There are many costs that go into purchasing a home. As such, you might wonder if you can go forgo buying title insurance and save some money. The truth is that title insurance is very necessary to have. Even if an Alabama title company performs a title search, it could miss potential risks. For instance, a title search might not reveal an unknown heir who may have rights to property. If you purchase title insurance, you avoid heavy expenses down the road.
Title insurance isn’t needed if you pay cash for your home
If you buy a home in cash, you might think that title insurance is no longer necessary. This is not true. Although paying for a home in cash eliminates the requirement of a mortgage loan, it does not eliminate the need for title insurance. Just because your home is paid for, does not mean there can’t be title defects down the road. Purchasing title insurance will protect your investment.
You can’t select the title company
Some homebuyers are under the impression that they are not allowed to hire their own title company. The truth is, however, that you’re permitted to select any title company you want. You definitely do not have to purchase title insurance from a company the seller chooses.
5 Services a Title Company Offers to Clients
Closing on a property purchase can become a complicated task. Some things are required by law, while others vary by state. Title companies offer a range of services designed to help different types of property buyers when a title is being transferred. Below is a simple list of things an Alabama title company can help you with.
1. Choosing Title Insurance
Insurance protects against unforeseen issues with property ownership, such as liens, hidden heirs or fraud. Buyers use companies like Closeline Settlements when they need services pertaining to the validity of the title. Title insurance can be beneficial for clients looking for a smooth closing process.
2. Facilitating the Purchase Closing
Having all the correct parties and their assisting personnel meet for a closing meeting can be tricky to arrange. An Alabama title company might be able to help by contacting all parties for a meeting in a local office or at an off-site location that better suits the buyer and seller. It’s important to choose a company that knows how to use technology like scanners and printers at the last minute to modify, print and notarize documents for you on the spot.
3. Providing Escrow Service
Some special transactions require a neutral third party to hold money. Title companies like Closeline Settlements can set up documents and ensure both parties comply with the legal requirements during an escrow holding period. Funds are securely held until an agreed-upon condition is met. The parties involved in the escrow contract can rest assured that their settlement is protected and in compliance with the law.
4. Managing Reverse Mortgage or Refinance
Whether an owner chooses to refinance or reverse a mortgage, an Alabama title company can manage the process end-to-end. This is where experience matters, and having access to a team ready to answer questions at a moment’s notice is a real advantage. Property owners looking to file a reverse mortgage are often worried about scams that plague the industry. Partnering with a title company that has a great reputation is a necessity.
5. Reviewing and Preparing Deeds
Property owners often choose an Alabama title company to help them with their deed preparation process. This may include researching the ownership history and identifying all legal parties involved with the property in the past. Property and location descriptions and an entire state-specific checklist are used to validate title ownership before a legal deed is drafted.
If you have further questions, you should schedule a consultation with an Alabama title company. Contact Closeline Settlements today.
Risks of Not Having Title Insurance
If you plan on buying a home, it’s important to purchase title insurance through a reliable Alabama title company. Although it’s not mandatory to have this insurance, it’s in your best interest to do so. You only have to pay a one-time fee and it can save you a lot of headache down the road. Here are some of the risks you face from not buying title insurance.
Paying Debt That Doesn’t Belong to You
Debt is something no one likes to deal with. However, it becomes even worse if the debt isn’t yours to begin with. If you forgo title insurance, however, you might just have to pay someone else’s debt. For instance, let’s say that the previous owner replaced the roof, but never paid the contractor for the work. In this case, the contractor could put a lien on the property. To remove the lien, you must pay the contractor for the services. On the other hand, if you purchase title insurance, the insurance company will take over the burden of settling the claim.
Losing Your Home
In the most extreme case, not having title insurance could force you to give up ownership rights to your home. For example, if a person sells a home that they own with someone else, but doesn’t tell the co-owner about the sale, it can create major problems. The co-owner could eventually show up to the property that you now own and claim that the home is theirs. In this situation, you may lose your home. That’s another good reason to have title insurance. It will protect your ownership rights.
Losing Part of Your Home Because of Encroachment
Encroachment occurs when a portion of your property encroaches on your neighbor’s land. For example, the fence could go past the property line or your garage may encroach on your neighbor’s property. Without title insurance, you will have to settle the matter with your neighbor and pay for it out of your own pocket. On the other hand, if you do have title insurance, it can pay for the costs of a new survey to discover the boundary lines.
Paying High Fees to Protect Your Ownership Rights
If a title defect threatens your ownership rights, you may have to spend thousands of dollars out of your own pocket to protect those rights. However, if you buy title insurance in the beginning, you won’t be responsible for paying the legal fees.