FAQ

What is Title Insurance?

In our everyday world working with Property Titles, those of us at Columbus Title Agency of Westerville, Inc. (CTA) are comfortable with the jargon and the complexities.  It’s our niche.  It’s what we do.  However, we realize that much of what occurs at the closing is a bit of an enigma to both buyers and seller.  Add the natural stresses that accompanying the financial responsibilities and implications involved, blurred eyes are very common.

We endeavor to make the process very clear and explain everything in a manner that makes all parties comfortable and educated about every step of the process.

CTA are agents for both First American and Old Republic Title Insurance Companies.  Please watch the informative video above from First American Title that provides a basic overview of Title Insurance.

For those who want to prepare and dig a bit deeper, we provide some FAQ resources below.  If your question isn’t answered, complete the adjacent form and we may just add it to the list.  However,  if you have a scheduled closing with CTA, please call us right away so that we can address your questions or concerns beforehand.

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What is title insurance?

Title insurance insures against financial loss caused by defects in title to real estate.  While a homeowner’s insurance policy protects against losses from a fire or other property damages, title insurance protects the title (or ownership rights).  While the title search provides a thorough examination, property owners (lenders) are protected by the title policy in the event of undiscovered defects in the future.

Title insurance companies defend against lawsuits attacking the title, or in the case of a covered loss, reimburse the insured up to the policy limit. Unlike other types of insurance, there are no annual payments to keep your title insurance policy in force. The premium is paid once, at the time of the property purchase (during the closing).

What protection does title insurance provide?

Title insurance protects you against loss due to title defects, liens, or other similar matters as well as from claims of ownership by other parties. It protects you against losses from problems that arose before you purchased the property. The title company will defend you in court in the event there is a claim against your property.  In such cases, the title insurance will pay for covered losses.  This is a compelling reason why you should choose a reputable title agency associated with experienced lawyers.  Columbus Title Agency of Westerville (CTA) has an experienced legal team with in-house attorneys Chuck Griffith (Griffith Law Offices), Josh Fravel and Keith Mohney and paralegal Lisa Zimmerman.

Is title insurance required?

A Loan Policy will be required by the lender, but technically, an Owner’s Policy is not required by Ohio Law.  However, it is an inexpensive purchase at the time of closing to protect this very important investment.

What insurance companies do your represent?

Columbus Title Agency are agents for First American and Old Republic Title Insurance Companies.

How long does a policy last?

A loan policy lasts until the loan is paid off.

An owner’s policy lasts as long as you or your heirs own the land. It also may provide warrantor’s coverage after you no longer own the property, depending on your policy provisions. Policy language has changed over time, so read the continuation of coverage provisions in your policy carefully to determine coverage terms.  Ask Columbus Title Agency to explain this to you.

Does title insurance renew?

No.  Title insurance is paid for just once when you buy the policy unless you decide later to add more coverage.

Keep your policy, even if you transfer your title or sell the property. Coverage lasts as long as you or your heirs own the land, and may last forever for any title warranties made when you sell the property.

Is title insurance like homeowner's insurance?

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Why is the owner policy more expensive than the loan policy?

When you buy an owner’s policy and a loan policy at the same time, the loan policy is issued at a discounted price.

If you decide not to purchase an owner’s policy, you will pay full price for the loan policy.

Is there a difference between owner and loan policies?

Loan Policy:  It does not protect you as the property owner!  When you close on your mortgage loan, title insurance may be included in the amount you pay. Known as a loan policy, this type of title insurance covers the mortgage company for up to the full value of the policy if you are unable to pay your mortgage bills and the company suffers a loss.

Owner’s Policy:  You can protect your own interest in the property you just bought with a policy called “owner’s title insurance.”

An owner’s title insurance policy describes the property and defines your ownership “limitations” — if any. The limitations could be in the form of existing liens or items disclosed to you before you agreed to the purchase. In other words, limitations you have accepted in buying the house.

Owner’s title insurance protects you against what you don’t know. It helps take the risk out of buying property whose legal history is long and may not be completely known to you. The so-called “hidden risks” covered by such a policy are not common, but they do exist. If your property’s ownership history carries such risks, you could lose the property and the money you paid for it. The mortgage company has a loan policy to protect its interest in the money it lent you. To protect your own interest in your new property, consider owner’s title insurance.

Why would l need a loan policy?

Unless your property purchase is clear of any mortgage (paying cash), the lender will require a loan policy.  This is not the same thing as Mortgage Insurance.

How long does a loan policy remain in effect?

Loan policies remain in effect until the mortgage is paid and the property deed is completely in the owner name or till the property is sold or refinanced.

What if I didn't secure an Owner's Policy at closing?

In the State of Ohio, if you decide you want owner’s title insurance, companies offer “simultaneous issue credit” as long as you buy the owner’s insurance within 30 days of closing (and buying the loan policy).

Simultaneous issue credit decreases the amount of your premium. Remember any insurance policy is only as sound as the company that issues it.

What does owner’s title insurance cover?

It is likely there are no hidden risks connected to your new property. However, such risks do exist, often as a result of errors made during past title transfers. Many different people may have owned the land and buildings over the years and there was a chance for error each time the title was transferred. If an error occurred but was not discovered until you bought the property, you may face a hidden risk (see examples). Your ownership of the property could come into question.

Owner’s title insurance protects you from such errors. Title insurance also provides the coverages shown below:

  • Protects you from financial loss due to covered claims against your title, up to the face amount of the policy.
  • Pays your legal costs if the title insurance company is required to defend your title against covered claims.
  • Pays successful claims against your title, up to the face amount of the policy.
  • Continues protection after you no longer own the property

What are examples of title defects or hidden risks?

  • False impersonation of the true owner
  • Confusion caused by similar names
  • Forged deeds and other documents
  • Clerical errors in public records
  • Errors in recording legal documents
  • Undisclosed or missing heirs
  • Fraud
  • Invalid divorces
  • Unpaid child support lien
  • Unpaid taxes (local, state, federal)
  • Invalid documents executed under an expired power of attorney
  • Unrecorded easements (rights of way)
  • Signatures of minors or people who are not mentally competent
  • Signatures of people represented as single but who are actually married

What happens if the value of my home increases? Am I covered?

You are covered for the value of your policy.

If you add major improvements to your home, or if your home increases in value over time, you can buy an increased value endorsement to cover the increase in your property’s value.

What happens if I refinance?

Talk to us at Columbus Title Agency.  There may be discounts available to you depending upon various circumstances such as when you originally closed and the date of the previous title policy.

What is an Attorney's Opinion?

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How is title insurance different from the Attorney's Opinion?

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Can I transfer my title insurance?

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What's the difference between a title commitment and a title policy?

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What does the title commitment do?

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Do I pick my own title company?

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Can I get a discount on the purchase of my policy?

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How can I save money on my closing?

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Do all title companies charge the same policy premiums?

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Where do I get the title policy? How do I buy it?

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What's a closing agent?

Columbus Title Agency of Westerville, Inc. (CTA) acts as the closing agent.

As your closing agent following a Title Order, CTA coordinates the activity and documentation of all parties involved in the transaction:

From you and your real estate agent:

  • A copy of the sales contract
  • Original termite inspection
  • Names of gas, certification, and home warranty companies
  • Attorney information
  • Lenders and payoff information (if available)
  • The new homeowner’s insurance agent

From the lender –

  • The complete loan package
  • Closing instructions, including all requirements for proper disbursement of all funds

CTA Prepares the following for closing:

  • Mortgage Loan documents
  • Settlement Statements
  • Riders
  • Affidavits
  • Various notes
  • Additionally, all disbursements for the transaction are prepared and distributed by CTA acting as the escrow agent.  All funds are received and disbursed via wire transfer.

What's the actual role of the closing agent?

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What if I don't like the wording of my policy? Can it be changed?

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What happens during the closing?

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What happens after the closing?

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What if I don't like the wording of my policy? Can it be changed?

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Sources:

Columbus Title Agency of Westerville, Inc. Experience, Real Estate Law and Title Insurance Acumen

The Ohio Department of Insurance Consumer Services:

http://www.insurance.ohio.gov/consumer/publications/titleins.pdf

Ohio Land Title Association:

http://www.olta.org/?page=WhyTitleInsurance

FAQ October 17, 2018