SCHUTT LAW FIRM, P.A.
Phone: 239.540.7007
Title Insurance
04/30/2021
Owning a home is a goal that many people have, but it's important that you don't rush into it. You first want to be sure now is the right time to dive into homeownership. To decide if you're ready, use these tips from Schutt Law.

Wait Until You're Ready to Buy a Home

Buying a home is a serious commitment, so you have to be sure you're ready to take this step. To help you decide if this is the right move for you right now, use this helpful information.

If you're buying a new home, you're not protected if you don't have title insurance in Fort Myers. To learn more about title insurance, contact the experts at Schutt Law. Give them a call at (239) 540-7007 to get your questions answered.

Are You Ready to Make a Downpayment?

Before you dive headfirst into buying a home, your first want to be sure you have enough saved up to make a downpayment. A downpayment will usually require a cash payment equal to 20% of the home's price. If you don't have this, this doesn't mean you can't buy a home. You may still be able to purchase property, but you will have to also purchase private mortgage insurance. This is needed to protect your mortgage lender in case you default on your payments. It can add up quite a bit, leading you to pay more than what you expected in a year for the home. Keep in mind that you also shouldn't drain your savings to make a downpayment. You need to have a separate savings account for this so that you can still have your emergency fund intact and other savings to cover moving costs.

Do You Have Debt?

Having debts can negatively affect your financial standing. It may not sound like a huge deal, but your credit score can suffer as a result. If your credit score can stand to improve, then you may not be getting great loan offers. You may get a lower offer or offers with higher interest rates, neither of which is ideal. Rather than accepting a deal that isn't quite what you wanted, work on paying off your debts. Take some time to pay off anything from student loans to credit cards so that you can improve your credit score. Hold off on making any large purchases for a while and get rid of credit cards you don't need. Once you see your credit score improve, then you can try getting a better loan offer.

Is Your Income Stable?

Next, having a stable income is a must if you want to buy a home. If you recently started a new job or don't feel like you have a secure job, don't jump into homeownership yet. If you lose your job, paying a monthly mortgage can get tough and very stressful. Instead, wait until you're sure your position is secure. You don't want to default on your loans for a number of reasons, so don't take this leap until you have a stable income and job.

Be sure to purchase title insurance in Fort Myers to protect your investment. To learn all about the importance of title insurance, contact the friendly experts at Schutt Law at (239) 540-7007.

Are You Ready to Stay Put?

When you use a mortgage lender to buy a home, you usually sign a contract that lasts years. Most home loans can take 15 to 30 years to pay off, so it should be considered a serious commitment. With that said, don't commit to this if you're not even sure if you want to live in the same town for at least the next five years. If you do decide to move in a year, you can face serious financial losses. Not only did you take out a hefty loan, but you likely also paid quite a bit for other costs associated with buying a home. To avoid these losses, be honest about where you see yourself in the future.

Are You Making This Decision?

Finally, this is a huge decision that requires a lot of thinking. Don't let others pressure you into buying a home just because you can afford it or because you think this is the next step you should take as an adult. You can continue to rent until you're absolutely sure you want to buy a home.

Protect your home investment with title insurance in Fort Myers. The title insurance experts at Schutt Law can answer all the questions you may have. Give them a call at (239) 540-7007 to get your questions answered.

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