What is a title insurance policy?

A title insurance policy is a type of insurance that provides protection against financial loss due to defects in titles to real estate and other property located in Washington. It ensures that the property is legally owned by the insured (owner, lender, or other party) and that there are no claims or liens against it that might make the owner liable for damages or legal costs. Title insurance is purchased by the owner, generally through their title company. The title company will search public records to identify any potential issues with the title (such as liens, unpaid debt, or other restrictions). If any issues are identified, the title company must address them before a policy can be issued. Once the title is clear, the title company will issue the title insurance policy. The policy provides protection to the insured for any losses that result from an unknown claim or lien against the property. This means that if someone else comes forward and claims to have a legal interest in the property, the title insurance policy will cover any losses that the insured may incur as a result. For example, if someone else claims to own the property but the title insurance policy covers the insured for any legal costs, the insured would be protected from any financial losses due to the claim. Title insurance is an important part of residential real estate law in Washington and helps protect buyers and lenders from unexpected financial losses due to unknown title issues. It is important for those purchasing or lending on properties to understand the importance of title insurance and the financial protections it offers.

Related FAQs

What are the risks of buying a foreclosure?
What is a principal residence exemption?
What is a disclosure statement for a landlord-tenant agreement?
What is foreclosure by judicial sale?
What is the difference between a buyer’s and a seller’s agent?
What are escrow services?
What is the process for filing a complaint against a real estate agent?
What constitutes a valid real estate contract?
What is an Option Clause in a real estate contract?
What is an option to purchase?

What is a title insurance policy?

Related FAQs

Related Blog Posts