If the title report is clear, why do U need title insurance?

seems to me like a big rip-off based on fear of being sued. if someone does challenge Ur title, U could sue the title company for a false report. I asked the title person (I sell a lot of land I own) and she didn't answer me. Prolly she knew I was on to their scam?
  • October 12 2011 - US
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Answers (5)

Suppose U bought a foreclosure and it turns out the foreclosure wasn't done properly: I'll bet they won't help U there either? (I think I read something about this recently in the news . . . big lawsuit against title company.)
  • October 12 2011
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Title insurance is always good to buy, even though the title is clear. If for some reason there is an issue that arises, you are covered. Title insurance is one of the cheapest forms of insurance you can buy. It will be very expensive to clear up if there is a title issue in the future.
  • October 12 2011
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Profile picture for sunnyview
I can't say that for sure, but that's what my title report disclosures said. Those disclosures were pretty slippery. In fact, when I closed on a house in the past, my title company had missed paying a termite guy and sent me the final settlement check without paying his demand.

When I went back to ask what the heck happened, they said that it was an oversight and that I should pay him out of pocket. That usually doesn't happen, but I can tell you that they had outs in the contract so that their oversight quickly became my issue to deal with. My best advice is be careful, read the contract and make sure you feel comfortable with the risk before you waive the policy.
  • October 12 2011
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Hmmm, Sunnyview, I'll read my contract. Sounds like Ur telling me they don't guarantee their title report and that the insurance is their guarantee.
  • October 12 2011
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Profile picture for sunnyview
You can take the risk of not buying title insurance, but the escrow companies have vetted the disclaimers on their contracts so if you hope to collect from them if anything goes wrong you better have deep pockets and a really good attorney.
  • October 12 2011
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