August 20th, 2007 - Homebuilders See Signs of Stability

July 22nd, 2007 -
Why Hasen't My Home Sold?

July 3rd, 2007 - To Buy Or Not To Buy

June 22nd, 2007 - A Successful Transaction

June 4th, 2007 - What's A Title?

May 28, 2007 - Whats a blog?

Unlocking the Universe’s Great Mysteries – What is Title?

Last year my wife and I took a cruise together. During one of the comedy shows we attended, I was unwittingly dragged up on stage to become a part of the show. The comedian’s first question to me was the usual “So, what’s your name?” That was followed up by the expected, “Tell us, Jim, where are you from?” and finally “What do you for a living”. I responded with the highly articulate, “Um, I’m in title.” And his response? – “Is that anything like being in mud?” While he was trying to evoke some laughter from his audience, it brought to the forefront that most people really don’t know what Title Insurance is and what someone who’s ‘in title’ does.  So to help dispel some of the mist and mystery from title insurance, read on!

If you've purchased a home you may be familiar with the benefits of title insurance. The purchase of a home is one of the most expensive and important purchases you will ever make.  You and your mortgage lender will want to make sure the property is indeed yours and that no one else has any lien, claim or encumbrance on your property. Now, unlike other forms of insurance you may have (life insurance, auto insurance, etc.) title insurance protects you against PAST actions, as opposed to FUTURE events, to prevent losses caused by title defects that may have been created in a previous sale of the home. For example, a person might claim to have a deed or lease giving them ownership or the right to possess your property. Another person could claim to hold an easement giving them a right of access across your land. Yet another person may claim that they have a lien on your property securing the repayment of a debt. Having title insurance will protect you against all of these possibilities.

Another point separating title insurance from other types of insurance is that you only pay it once, at the close of escrow on your home, whereas you would pay auto insurance or life insurance for as long as you want to be insured. That one payment for title insurance covers you for as long as you own the property, or until you refinance. You can really think of title insurance as a “blanket of security” protecting you. 

I’d like to give you an example of how some home owners were protected by having title insurance, without evening knowing it. In South San Francisco, the city needed to replace water pipes running through a street of houses. One family, however, had built an in-ground pool above the pipes and were therefore inaccessible by the city. Now, the family would have had to have spent tens of thousands of dollars to remove the pool but as it was not cited as an easement on the Preliminary Title Report, the family’s title insurance kicked in and the title company paid to have the pool taken out and moved to another location in the backyard.

Keep in mind that interest rates aren’t nearly as bad as they have been historically. In 1989, when my wife and I bought our house, we were LUCKY to get 10.875% rate on our loan. If we’d had a $500,000 loan, we would have spent over $1,197,202 over 30 years. At today’s rate of 6.5%, we’d spend $637,479. That’s a savings of more than $559,479 on a $500,000 home! And don’t forget that North American Title Company offers discounts on title insurance to First Time Homebuyers and Senior Citizens, both up to 25% off!