If you are like most people in Rhode Island, your home will be one of the most important purchases you can make in your lifetime, so it’s only fitting to protect that investment from financial losses and any other disputes that might arise in the future. That’s where title insurance comes in. Here’s what you need to know about this insurance policy and why you may want to consider buying it.
What is title insurance?
This type of insurance protects homeowners and mortgage lenders from losses that may occur as a result of problems or defects with the title of their property. If any issues arise during or after the sale, the insurance will reimburse you for legal damages and other related financial losses incurred, depending on the terms of your policy.
Why would you need title insurance?
It can protect you from hidden problems with the title. Title searches help homebuyers examine public records for any ownership issues that a home might have. However, sometimes, that’s not enough. There may be hidden problems not mentioned in the public records about that property. Title insurance can help you cover financial losses incurred while dealing with those issues.
Knowing that you are protected from any financial losses that may occur due to problems with your property’s title can provide you with peace of mind. This can be especially important if that issue arises when you are not financially prepared to deal with it because the insurance company will step in.
It may also be a loan condition. If you are taking a loan to purchase a property, the lender may require that you buy title insurance. This is because they want to protect themselves from potential losses in the event that you cannot legally transfer the title rights when you default on the loan.
While title insurance is not legally required in Rhode Island, real estate professionals highly recommend it. When getting a policy, read the terms carefully to ensure that it covers the key things you need for your home.