What is an Abstract? Why do I need it?
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Q: What is
An abstract is a history of the title to a particular tract
of land. It is not a title! It consists of a summary of the
material parts of recorded instruments affecting the title
of the real estate.
What is a Title?
A title is the evidence, of right, that a person has to the
ownership and possession of land. It is possible that someone
other than the owner has a legal right to the property. If
that right can be established, this person can claim the property
outright or make demands on the owner as to its use.
is Title Insurance?
insurance is a contract to protect an owner against losses arising
through defects in the title to real estate owned. If the title
is insurable, the company guarantees the owner against loss
due to any defect in title or expenses in legal defense of the
title pursuant to the terms of the policy.
I need Title Insurance?
definitely! Title insurance is a means of protecting yourself
from financial loss in the event that problems develop regarding
the rights to ownership of your property. There may be hidden
title defects that even the most careful title search will not
reveal. In addition to protection from financial loss, title
insurance pays the cost of defending against any covered claim.
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Q: What can make a Title Defective?
number of problems that remain undisclosed after even the most
meticulous search of public records can make a title defective.
These hidden "defects" are dangerous indeed because you may
not learn of them for many months or years. Yet they could force
you to spend substantial sums on a legal defense, and still
result in the loss of your property. However, there are many
possible causes of title defects that no examination can disclose.
That is because they have never been recorded and thus do not
appear in the abstract. A title insurance policy protects the
owner against all these hidden risks; those listed below and
Fraud. False claims of ownership, forged deeds, wills,
signatures, conveyances, instruments, false representations,
false records of all sorts, illegal acts of trustees, guardians,
administrators, and attorneys.
Human Error. Errors
in copying, indexing, recording; errors by administrators, executors,
trustees, guardians and attorneys; destruction of records.
Improper deeds and wills.
Deeds by persons of unsound mind,
minor; deeds delivered after death or without the grantor's
consent; invalid suppressed, erroneous wills, missing heirs,
Liens and other rights. Liens for unpaid estate, inheritance,
income, property and gift taxes; homestead rights, community
property rights; irregular court proceedings, court opinion
reversals, lack of court jurisdiction; defective foreclosures.
Q: What is a Torrens Title?
a very limited number of states the Registered Land System is
used. Under this system, a court
has been brought naming parties who have an adverse interest
in the property. If everything in the proceedings is completed
and handled properly the Plaintiff is said to have a good title.
However this is not a title guarantee by the state, in most
cases. The Torrens System has been abandoned by most states
that had adopted it, primarily because the associated court
proceedings complicated title transferring, delayed real estate
sale proceedings and caused extra and unnecessary expenses.
Q: What does Title Insurance
A: The cost is directly related to the value of the
property. The higher its value, the more coverage is needed.
The premium is small compared to the total purchase price. The
premium is paid only once and remains in force for as long as
the property is owned by the insured and continues to protect
the insured on warranties after it is sold.