If you’ve kept up with our other blogs recently, then you may have noticed one that we discussed a policy called title insurance. We are here to straighten out any confusion you may have and answer any questions you may ask. For your reference, today we’re going to explain in every way how each person/party who is involved in a real estate deal is effected by title insurance.
1. A Lenders’ Policy (issued only to mortgage lenders). This type of policy does not cover the owner’s interest in the property. The initial policy limit is the amount of the mortgage. This limit decreases each year, and disappears when the loan balance is paid off.
2. An Owner’s Policy which protects the owner’s interest for the full purchase price of the property. Most sellers pay for this policy as part of their obligation to deliver a clean title to the buyer.
3. A Construction Policy which can be purchased when land is being developed for the first time, as the land is likely to have had prior owners. A title search will uncover any existing liens, and a survey will determine the boundaries of the property being purchased. If the builder fails to pay subcontractors and suppliers, title insurance covers the new owner against any lien on the property.
So the next time you are in need of any Connecticut Insurance, stop by Paradiso Insurance today for the best quote in town!