SCHUTT LAW FIRM, P.A.
Phone: 239.540.7007
Title Insurance
12/19/2018
 If you're eager to purchase your first home, be sure you're absolutely ready for the financial responsibilities of homeownership. Below are some points to consider before purchasing your first home.

Signs That Indicate You're Not Ready to Be a Homeowner

Buying a home is by no means an easy process. It takes planning, preparation, and a lot of patience. Before you take the plunge and decide now is the time to buy your first home, be sure you're ready for what that means. If you're not completely sure that you're ready for this endeavor, the following tips can help you decide if now is the time to do it.

You Still Have Debts to Pay Off

Before deciding to buy a home, you first have to be sure you can afford such a large investment. This doesn't mean you have to be ready to pay for the home in cash, but you will have to be a good candidate for a home loan. Lenders will be hesitant to give a loan to someone who they don't think will be able to make monthly payments. This means your financials will be looked at, so you want to be sure they're in order and that you're in good financial standing. If you have outstanding debts, this won't help your cause. Having debts can make lenders think you may not be able to make a house payment as well as other payments every month. To improve your chances of a getting a home loan and a good one at that, take care of your debts first. Once these are paid off, you'll be a better candidate for a home loan.

Your Credit Isn't Great

Another item that mortgage companies will check in on is your credit score. Without a decent credit score it can be hard to snag a home loan, so don't ignore your credit. If you do manage to get a home loan you may find that your repayment options aren't the best. To avoid getting stuck with a less than ideal mortgage, check your credit score before you even start shopping around for homes. This will let you know where you stand so that you can make your next move. If your credit score isn't where you would like it there is plenty you can do to fix it before reaching out to a lending company. A great way to boost your credit score is by paying off your credit cards and any other debts you have. In the meantime, avoid large expenses and don't open any new credit cards.

If you've decided you're ready to take the plunge and invest in a new home, don't forget to include title insurance in Fort Myers, FL in your plans.Without it you risk major losses. Contact Schutt Law to learn why title insurance is so necessary when buying a home. Give them a call at (239) 540-7007 to learn more.

You Don't Have Any Savings

Since your financials will be checked thoroughly, you also want to be sure that you have some savings ready to make your purchase. Again, you won't have to have enough to pay cash for the home you have your eye on, but some savings will be needed in order to pay for some upfront costs. To start, you'll need to be able to make a downpayment on the home you want. Oftentimes, a 10% downpayment is the minimum you'll be asked to make. On top of that, you have to be ready to pay closing costs, your real estate agent's fees, fees associated with moving, home insurance, and other hidden fees. Without savings this can get very overwhelming. If you don't currently have enough in your savings to do all of this comfortably, hold out a little longer. Create a budget for yourself that will allow you to save up a target amount before you start looking for a home or applying for a mortgage.

You're Not Ready to Settle Down

Buying a home means you'll have to stay put for a while, so be sure you're ready to settle down and stay in the same location for a at least next few years. If you haven't really figured this out yet, it may not be a good idea to go through the home buying process only to decide you want to move somewhere else soon. Selling a home is also a bit of a hassle and you can often lose out because of fluctuating home prices. Don't let anyone pressure you into buying a home even if your financials are perfect. If you're not ready to stay put, wait it out.

Protect Your Investment With Title Insurance in Fort Myers, FL

 If you've decided now is the right time to purchase a home, remember to also purchase title insurance at closing. Running a title search can help ensure there are no clouds in the title that can put your investment at risk. Contact Schutt Law at (239) 540-7007 to get your title search started.
WHY TITLE INSURANCE?
Owning real estate is one of the most precious values of freedom in this country. You want the assurance that the property you are buying will be yours. Other than your mortgage holder, no one else should have any claims or restrictions against your home.

Title insurance is issued after a careful examination of the public records. But even the most thorough search cannot absolutely assure that no title faults are present, despite the knowledge and experience of professional title examiners. In addition to matters shown by public records, other title problems may exist that cannot be disclosed in a search. Title insurance eliminates any risks and losses caused by faults in title from an event that occurred before you owned the property.

Title insurance is different from other types of insurance in that it protects you, the insured, from a loss that may occur from matters or faults from the past. Other types of insurance such as auto, life, or health cover you against losses that may occur in the future. Title insurance does not protect against any future faults, but does protect you from risks or undiscovered interests. Another difference is that you pay a one-time premium for a policy that remains effective until the property is sold to a new owner - even if that doesn't occur for decades.
What is a Lender's Policy?

A lender's policy, also known as a loan policy or a mortgage policy, protects the lender against loss due to unknown title defects. It also protects the lender's interest from certain matters which may exist, but may not be known at the time of the sale.

This policy only protects the lender's interest. It does not protect the purchaser. That is why a real estate purchaser needs an owner's policy.
What is an owner's policy?

An owner's policy protects you, the purchaser, against a loss that may occur from a fault in the ownership or interest you have in the property. You should protect the equity in your new home with a title policy.

What does an owner's policy provide?

- Protection from financial loss due to demands that may be charged against the title to your home, up to the cost of the title policy.
- Payment of legal costs if the title insurer has to defend your title against a covered claim.
- Payment of successful claims against the title to your home covered by the policy, up to the cost of the policy.
Why the seller needs to provide title insurance?

Any purchaser will need evidence that his investment in your property is free of title defects. The title insurance policy that you provide the purchaser is a guarantee that you are selling a clear title to your real estate, unencumbered by any legal attachments that might limit or jeopardize ownership. It will reassure your purchaser that he or she is protected from any risks or losses and could help you close your deal.
Why the buyer needs title insurance?

Without title insurance, you may not be fully protected against errors in public records, hidden defects not disclosed by the public records, or mistakes in examination of the title. As a result, you may be held fully accountable for any prior liens, judgments or claims brought against your new property. If this should occur, your title policy insures that you will be defended at no cost against all covered claims up to the amount of the policy.
How much does title insurance cost?

The insurance commission approves and controls the premiums for title insurance policies. The premiums are paid only once and the cost depends upon the purchase price of the property and the policy amount must be equal to the purchase price.
What does title insurance protect from?
  • Fraud
  • Adverse possession
  • Rights of divorced parties
  • Deeds by minors
  • Undisclosed Heirs
  • Errors in tax records
  • False affidavits of death or heirshipProbate matters
  • Deeds and wills by persons of unsound mind
  • Conveyances by undisclosed divorced spouses
  • Forfeitures of real property due to criminal acts
  • Deeds by persons falsely representing their marital status
  • Documents executed by a revoked or expired Power of Attorney
  • Defective acknowledgements due to improper or expired notarization
  • Mistakes and omissions resulting in improper abstracting
  • Forged deeds, mortgages, wills, releases and other documents
  • False impersonation of the true land owner