If you’re a Realtor®, you know that a lender’s title insurance policy is required for any type of mortgage. You also know that many homebuyers are already confused and daunted by the process of buying a home. Why, then, would you want to burden your clients by suggesting they add purchasing owner’s title insurance to their already overwhelming to-do list?
Owner’s title insurance has tremendous value for your clients, but the term is often misunderstood. Certainly, if you routinely suggest it to your clients, you’ve heard the objection, “but I have title insurance already!”
It can be difficult to explain the value of this optional policy, particularly to someone being forced by a lender to purchase a policy with the same moniker.
How Owner’s Title Insurance Protects Your Clients
Owner’s title insurance protects your client from possible claims against the title. Lenders require title insurance to protect their investment—not the homebuyer’s investment. This can become an important distinction, should a title defect surface.
For example, if the seller had failed to pay a contractor for a basement waterproofing job, that contractor may file a lien against the property. The lender’s title insurance will not protect the home’s new owner from responsibility to pay this debt—even if it didn’t appear on the title search during the transaction. Your client could be on the hook for this existing debt.
Owner’s Title Insurance Has Enduring Value for Homeowners
Owner’s title insurance protects homebuyers financially, as long as they own their home. Your client will be protected against any and all future claims against the property for as long as he or she owns it. The homeowner pays a relatively low, one-time fee for this lifelong security. An owner’s title insurance policy is not affected by refinancing or home equity loans. It’s in force until the home transfers ownership.
Working With Smart Title and Escrow
Smart Title can keep your transactions running smoothly from start to finish, regardless of the dollar amount attached to them.
Call us at 615-393-6222 or get in touch with us online. We’d love to help you just as we help other Realtors in Franklin, Cool Springs, Nashville and Murfreesboro.