What is NY title insurance?
January 21st, 2022 by Candis Hall
NY title insurance is the only way to protect yourself against losses related to any cloud on the title, which is why it’s often required by lenders for large purchases like homes and commercial buildings. NY title insurance can be bought from title agencies like MacGregor Abstract.
A title search is a legal document verifying that a person or business has the right to sell, buy or own a particular property. It’s your guarantee that you’re purchasing your new dream home from the rightful owner. It’s also your protection against future legal challenges to your ownership of the property.
But even if you aren’t getting a mortgage, you still need title insurance. The value of your real estate assets could be devastated if someone challenges their ownership of the property and wins. A successful challenge means you lose everything you’ve invested in the property.
As long as there are lots of people out there with unresolved issues involving their real estate assets, there are going to be disputes and lawsuits over titles. Title insurers help protect against financial loss resulting from those challenges by paying claims on policies issued for title defects. And because most major title companies have subsidiaries that underwrite policies, they often share resources and information in an effort to identify problems with an owner’s title before they arise. This reduces policy premiums for all policyholders and minimizes investment losses for investors in real estate assets.
New York law requires all homeowners to purchase title insurance. This is why, when you go to complete your home sale, the buyer’s lender will require you to produce a New York title insurance policy in order for them to lend on the property.
Titled property owners are automatically protected against losses caused by defects in title. Title insurance policies do not guarantee a property owner’s rights in and to their property. Rather, they insure that a loss stemming from a defect in an owner’s title will be covered.
New York State Law requires that every owner of property titled in New York obtain title insurance upon transfer of ownership of any interest in real property through sale, gift or inheritance.
Title insurance is a type of insurance that covers losses arising from defects in title to real property. The policy protects the insured against losses arising from claims based on ownership interests, liens or encumbrances that were not disclosed by the insured.
What type of title problems might I encounter?
Mortgage lenders require title insurance as part of their loan requirements to protect themselves from undisclosed defects in the title to a piece of property. A lender may require that you purchase a policy if you’re applying for a home loan and are using the property as collateral. If you are buying a house, condo or other real estate and have obtained a mortgage, your lender will require that you purchase title insurance.
Title insurance can also be used to resolve disputes between current or previous owners, or even between two or more buyers. The policy protects an owner if there is disagreement over who holds legal rights to the property and how these rights are recorded. If you are buying real estate with other people, everyone who holds an interest in the property is covered by the policy. In this case, each party’s interest will be separately insured.