February 17, 2022
By: John L. Mashack
Recently a Pennsylvania couple selling their home was shocked to learn that they did not own the entire property. They were blindsided when the purchaser’s title company searched the local land records and discovered that their property sat on two parcels of land that were never legally consolidated when purchased in separate transactions in the 1960s. As a result, the deal fell through.
But a survey surveyor may not be enough to protect your investment. Surveyors are not perfect and do make mistakes. A prime example of a serious survey error occurred several years ago in Florida when two separate state-certified surveyors independently marked the wrong lot, which resulted in a multi-million-dollar home being built on the wrong property. This is where an owner’s title insurance policy would come in handy.
The owner’s title insurance policy is fully optional. Owner’s title insurance is a low, one-time fee at closing that protects your property rights for as long as you or your heirs own your property. While it is your choice, an owner’s title insurance policy is the best way to protect your interests. A lender’s title insurance policy is almost always required by your lender, but lender’s title insurance protects the lender’s interest, it does not protect you.
Owner’s title insurance protects you, your trustees, heirs and beneficiaries against title defects and legal claims for as long as you own your property. It also protects you after you sell your property.
Owner’s title insurance protects your property from legal claims against and defects to the title to your property. Owner’s title insurance protects you from legal and financial problems such as:
- Clerical error;
- Missing heirs;
- Undisclosed easements;
- Undisclosed tax liens; or
- Unreleased mortgages or judgments against prior owners.
Owner’s title insurance protects you against hidden title risks, which are matters, rights or claims that are not shown by the public records, therefore not discoverable by a search and examination of those public records. Matters such as forgery, incompetency or incapacity of the parties, fraudulent impersonation, or unknown errors or incorrectly indexed documents in the public records, are unknown, hidden risks and could provide a claim against your home.
In the event of a covered matter affecting your title, your owner’s title insurance policy may protect you by:
- Defending your title;
- Bearing the cost of settling the covered matter; or
- Paying you for your loss due to the covered matter.
Owner’s title insurance protects your investment. A home is the largest investment you will make in your life. Owner’s title insurance is a smart choice to protect your property. For a small, one-time fee at closing, you will purchase peace of mind that your home will be protected against title defects and legal claims that may come as long as you and your heirs own your property.
We recommend that you purchase a survey and an owner’s title insurance policy to give you the peace of mind that you are purchasing exactly what you believe you are purchasing, and the knowledge that your property is protected if there is an error with the survey or in the local land records. A survey can also verify whether there are any encroachments onto your property or onto your neighbor’s property. This one-time purchase at your closing will also be helpful in the future if you decide to add a fence around your property to build a deck or other addition to your home.
Please call us at (703) 737-3800 if you have any questions about surveys or if Loudoun Commercial Title can be of any other assistance.