Why You Need Title Insurance

General counsel and director of business development at BETA Abstract, attorney Marc Rovner has been working in the title insurance industry for over two decades. Based in East Rockaway, New York, Marc Rovner oversees offices as far afield as Boca Raton, Florida, and teaches continuing education in the area of title insurance.

Most all lenders require title insurance to be purchased as part of the loan process, but many homeowners don’t entirely understand what title insurance covers. One of the main things that title insurance is meant to protect against is undisclosed liens. Banks and other lenders may be able to place liens on a property even after the property is sold if the previous owner failed to settle outstanding financial obligations.

Another common title issue is mistakes in public records. If there is a filing error or other clerical mistake in the property’s documents, it must be remedied once discovered. Title insurance covers the cost of those remedies.

In addition, title insurance also protects against forged documents. If property documents are discovered to be forgeries, this could jeopardize your rightful ownership. Title insurance would cover the financial risk of losing the property.

Overview of Title Insurance in Real Estate

A senior staff attorney at BETA Abstract LLC, Marc Rovner is a longtime resident of East Rockaway, New York, home of his beloved ice hockey team the New York Rangers. In addition to overseeing BETA’s business development in New York, New Jersey, and Florida, Marc Rovner of East Rockaway has taught a course on title insurance at Hofstra University.

In real estate, title insurance protects both the owner and any lenders against financial loss due to any faults in the title to a property. Unlike traditional insurance, which protects against future claims, title insurance covers claims for past errors and occurrences, including forgery, unpaid mortgages and taxes, omitted heirs, and limitations on the use of the property. Property owners and outright purchasers of property may elect to obtain a title insurance policy. However, property buyers who borrow money to make the purchase are required to secure title insurance to protect the lender from potential liability in case the seller fails to transfer the ownership rights. Title insurance requires a one-time payment, which is generally initiated in escrow after a purchase agreement has been completed.

The Benefits of Title Insurance

An East Rockaway resident, Attorney Marc Rovner is responsible for business development across New York, New Jersey, and Florida and oversees the legal department at BETA Abstract, LLC. In addition to his responsibilities as an established attorney, Marc Rovner is a professional educator and teaches real estate and title insurance law-related continuing education courses.

Title insurance, a type of indemnity insurance, provides financial protection from losses that may result from flaws in a property’s title. It commonly comes in two primary forms: lender’s title insurance, which protects the lender, and owner’s title insurance, which protects the buyer in a real estate transaction.

While there are differences from one policy to another, the benefits of title insurance generally include coverage against claims arising from issues that could have been identified in public records and those arising from issues that could not be identified in public records. Other parties to real estate transactions benefit as well. Lenders benefit in that their mortgage investments are protected from loss due to title-related defects, while sellers enjoy greater marketability and protection from financial damage when selling homes with title insurance policies in place.

The Two Basic Types of Title Insurance

For nearly 15 years, Marc Rovner, an experienced title insurance attorney from East Rockaway, New York, has served as general counsel and director of business development for BETA Abstract, LLC. As senior staff attorney for the company, Marc Rovner oversees business development in five offices in New Jersey, Florida, and New York.

Title insurance is divided into two basic types: a loan policy and an owner’s policy. The latter type protects the buyer and is often issued in the amount of the real estate purchase price. With this type of title insurance, homeowners’ rights are protected for as long as the owner or his or her heirs maintain an interest in the property. In some cases, this is true even after a property has been sold. Depending on the area, an owner’s policy is bought by either the buyer or seller of a property.

A loan policy protects a property’s mortgage or lender as long as they maintain an interest in a property. Most of the time, this interest continues until a mortgage is paid off. While a loan policy is in place, the validity and enforceability of a mortgage are maintained. When issued, loan policies are in the amount of the loan. A new policy is needed whenever an existing real estate loan is refinanced.