Metro Title
The question is frequently asked, "Why is a real estate transaction so complicated?" The answer lies in the nature of the title itself, In recognition of the substantial character of land ownership, it has been surrounded by certain safe-guards; and while you may own a piece of property, others might also have rights in that same real estate. A thorough investigation of all the pertinent facts disclosed by the public record is necessary.
"But I have a deed," many people say, "isn't that all I need?" No, a deed is not proof that the seller actually is the owner. Nor does it contain information regarding the rights others might have in the property. 'Can't I find out about their rights from the public records?" Yes—most of them, A careful investigation of all matters of record by competent individuals can disclose items such as unpaid taxes, mortgages, easements, restrictions, etc., However, all of the necessary information is not contained In a single book, in a given office, or even In the same city. Add to these possible errors in indexing, improper searching, errors in examination... in other words, the human element. Besides, what is not in the public records is what often causes title trouble!
Title insurance is a contract to indemnify against losses arising through defects in title to real estate. As a rule a title company will not insure a bad title any more than a fire insurance company will, issue a policy on a burn-ing building. However, title companies can disregard many technical, objections that might be raised by someone examining the abstract. If the title is insurable, the company guarantees' against loss due to any defects in title not specifically set forth in the policy, and to pay all expenses In defense of any lawsuit at-tacking the title, The bulk of the title Insurance premium Is spent to PREVENT loss from occurring—which Is why the , premium can be so low.
A mortgage company will often require a title policy for its own protection, The policy protects ONLY the lender, To protect himself against the many possibilities of loss due to title defects, a purchaser should purchase an OWNERS title insurance policy.
An abstract is a history of the title lo a, particular tract of land. It consists of a summary of the material parts of every recorded instrument affecting the title to real estate. An abstract may be perfect; but the title Imperfect—since the abstract does not purport to pass on the validity of any of the documents in It, It merely reports them for an examiner to interpret.
These are the defects that are in the title which no examination can disclose. A title policy protects against all these hidden risks and more.
