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Why is Title Insurance Important ?
A real estate purchase is one of the best investments you
can make, so be certain to protect your land ownership against
possible title problems that can hinder the transfer of your real
property or make it unmarketable. These problems are defects that
occur before the date of the policy and remain undisclosed until
some time later. Even the most thorough search of the public
records cannot reveal some of these "hidden" hazards.
A one time premium safeguards your property from actual
loss resulting from any risk covered by your policy, up to the
amount of the policy, and provides for defense costs also, unless
specifically excluded. Title insurance covers title defects such
as :
- Forged deeds, mortgages, satisfaction or releases of
mortgages and other instruments.
- False impersonation of a true owner of the land.
- Instruments executed under fabricated or expired power
of attorney (death or insanity of principal).
- Deeds apparently valid but actually delivered after
death of grantor or grantee, or without consent of
grantor.
- Deeds by persons of unsound mind.
- Deeds by minors.
- Deeds not properly delivered.
- Deeds which appear to convey title but are really
mortgages.
- Outstanding prescriptive rights not of record and not
disclosed by survey.
- Descriptions apparently but not actually adequate.
- Duress in execution of instruments.
- Defective acknowledgment due to lack of authority of
notary. (Acknowledgment taken before commission or after
expiration of commission.)
- Deed of property recited to be separate property of
grantor which is in fact community or joint property.
- Deeds by persons apparently single but actually
married.
- Deed from bigamous couple-prior existing marriage in
another jurisdiction.
- Undisclosed divorce of spouse who conveys as sole heir
of deceased spouse.
- Undisclosed heirs
- Misinterpretation of wills, deeds and other
instruments.
- Birth or adoption of children after date of will.
- Children living at date of will but not mentioned
therein.
- Discovery of will apparently intestate individual.
- Discovery of later will after probate of first will.
- Administration of estates and probate of wills of
persons absent but not deceased.
- Conveyance by heir, devisee or survivor of a joint
estate who murdered the decedent.
- Deed from trustees of purported business trust which
is in fact a partnership or joint stock association.
- Deed of executor under non-intervention will when
order of solvency has been fraudulently procured or
entered.
- Deeds to or from corporations before incorporation or
after surrender or forfeiture of charter.
- Claims of creditors against property conveyed by heirs
or devisees within prescribed period after owner's death.
- Mistakes in recording legal documents. (For example,
incorrect indexing, errors and omissions in transcribing
and failure to preserve original instruments.)
- Erroneous ancient location of pipe or sewer line which
does not follow route of granted record easement.
- Special assessments which become liens upon passage of
a resolution but before recordation or commencement of
improvements for which assessed.
- Want of jurisdiction over persons in judicial
proceedings.
- Failure to include necessary parties in judicial
proceedings.
- Federal estate and gift tax liens.
- Sate inheritance and gift tax liens
- Errors in tax records. (For example, listing payment
against wrong property.)
- Ineffective waiver of tax liens by tax or other
governing authorities repudiated later by successors.
- Corporate taxes as liens as liens on all corporate
assets, notice of which does not have to be recorded in
the local recording office.
- Erroneous reports furnished by tax officials (not
binding on municipality).
- Tax homestead exemptions set aside as fraudulently
claimed.
- Lack of capacity of foreign personal representatives
and trustees to act.
- Deeds from nonexistent entities.
- Interests arising by deeds to fictitious characters to
conceal illegal activities on the premises.
- Deeds in lieu of foreclosure set aside as being given
under duress.
- Ultra vires deed given under falsified corporate
resolution.
- Conveyances and proceedings affecting rights of
servicemen protected by the Soldiers and Sailors Civil
Relief Act.
- Federal condemnation without filing of notice.
(Federal law does not require filing notice of taking in
local recording office.)
- Break in chain of title beyond period of examination
of public records where running of adverse possession
adverse possession statute has been suspended. (True
owner is incompetent, absent or incarcerated or title is
held by the sovereign.)
- Deed to a purchaser from record owner of land who has
sold property to another purchaser on unrecorded land
contract and the contract purchaser has taken possession
of the premises.
- Conveyances void in violation of public policy
(payment of gambling debt, payment for contract to commit
crime or conveyance made in restraint of trade).
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