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The
Benefits of Title Insurance
Title insurance issued by Commerce Title provides a broad
range of benefits to the parties involved in a real estate
transaction.
To the Purchaser of Real Estate
The purchaser of real estate needs protection against serious
financial loss due to a defect in the title to the property
purchased. For a single, one-time premium, which is a modest
amount in relationship to the value of the property, a buyer
can receive the protection of a title insurance policy ' a
policy that is backed by the reserves and solvency of the
Company. A title insurance policy will cover both claims arising
out of title problems that could have been discovered in the
public records, and those so-called "non-record"
defects that could not be discovered in the record, even with
the most complete search.
A title insurance policy will not only protect the insured
owner, but also that person's heirs for as long as they hold
title to the property, and even after they sell by warranty
deed. The Company will not only satisfy any valid claim made
against the insured's title, but it will pay for the costs
and legal expenses of defending against a title claim.
To the Lender
The overwhelming majority of mortgage loans made in the United
States are made by persons who are acting in a fiduciary capacity:
by savings and loan associations, savings banks, and commercial
banks on behalf of their depositors, and by life insurance
companies on behalf of their policyholders. Because they are
lending other people's money (other people's savings or policyholder's
funds) these lenders must be concerned with the safety of
their mortgage investments.
A policy of title insurance provides a mortgage lender with
a high degree of safety against the loss of security as a
result of a title problem. This protection remains in effect
for as long as the mortgage remains unsatisfied.
Commerce Title also provides lenders with in-depth expertise
on a wide variety of title related matters to facilitate the
mortgage loan process, and to resolve differences among the
various parties in the transaction.
To the Seller
An owner of real property whose interest is insured by an
owner's title insurance policy has the assurance that the
title will be marketable when selling the property. The title
insurance policy protects the seller from financial damage
if the seller's title is rejected by a prospective purchaser.
Also, when the seller conveys with "warranties,"
which is a traditional, the seller is still protected if the
buyer sues because of a breach of those warranties.
To the Real Estate Attorney
Title insurance enables the real estate attorney to provide
the client with substantially greater protection than would
be afforded by the attorney's opinion alone. The attorney's
opinion is only limited to recorded matters and the client
can only recover from the attorney if the attorney is found
to be negligent. (Remember the case of Watson v. Muirhead
that prompted the creation of title insurance')
To the Real Estate Broker
The title insurance company and the real estate agent both
seek to ensure that as many purchases as possible are closed
to the satisfaction of all the principals in the transaction.
From the broker's standpoint, the efficient and safe transfer
of title will result in client satisfaction, increased prestige,
and continued business.
Apart from the security that title insurance offers, most
brokers have experienced numerous instances in which title
insurance personnel have enabled them to close transactions
that otherwise would have been delayed. By helping to avoid
delays, Commerce Title is able to facilitate the job of the
real estate broker and to minimize the inconveniences and
costs to the homebuyer.
To the Home Builder
By providing various title insurance services and information
to the home builder, the title insurance industry can and
does assist the builder in identifying and evaluating building
and use restrictions, easements, etc., in removing title problems
that may arise, and in facilitating prompt and needed disbursement
of construction funds from the construction lender. All of
these services ultimately rebound to the benefit of the buyers
of newly constructed homes.
To the Community In General
Apart from the unique benefits title insurance offers to particular
parties interested in a real estate transaction, title insurance
companies can and do offer considerable assistance to public
officials through the use of their "title plants"
' the data banks of reorganized and indexed public records
that are maintained by the Company in many areas of the country.
Much of the information contained in title plants is not readily
available from other sources. This fund of information about
the date of recent sales, representative sale prices, ownerships,
area maps, use restrictions, surrounding properties, and a
host of other matters pertinent to proposed projects, has
helped representatives from all levels of government save
countless hours and taxpayer dollars. In addition, title plant
people frequently help recording officers correct errors they
discover in public indices and records.
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