Results Realty Buzz: August 2009

Informing you on the Real Estate Market in Spring Texas and the surrounding areas and other interesting tid bits!

Spring TX First Time Home Buyers Guide – The Title policy! – Part 7 –

Spring TX first time home buyers and Spring TX title policiesI am continuing my Spring TX first time home buyer series.  In this post we are going to talk about your Spring TX title policy.  In Texas we close at Title companies and if you are getting a loan you are going to be required by your lender to have a title policy. 

Title insurance provides protection against title defects that were unknown to you at the time you purchased the policy.  Before writing a policy, a title company will check for defects in your title by examining public records, including deed, mortgages, wills, divorces, court judgments, tax records, liens, and encumbrances.  The company will then defend in court any claims to the property that are covered by your policy, subject to certain limitations.  If the company loses, it will pay you for covered losses up to the amount of your policy.

In Texas, the two most common types of title policies are "mortgagee policies," which protect lenders, and "owner policies," which protect buyers.

Most lending institutions won't loan you money to buy a house or other property unless you purchase a mortgagee policy.  This policy will repay the balance of the mortgage if a claim against your property voids your title.  Mortgagee policies remain in effect until the loan is repaid.  Most lenders will require you to buy a new mortgagee title policy if you refinance your home. 

Spring TX title policyOwner policies insure property owners against the specific kinds of claims listed in the policy.  Any owner policy remains in effect as long as you or your heirs own the property or are liable for any title warranties made when you sell the property.  You should keep your owner policy, even if you transfer your title or sell the property.

In Texas our title policy forms are standardized.  This mean the policy language is the same, regardless of the company. Here is a blank title policy from Alamo title so you can see the standardized language.  Pay special attention to "Schedule B" of the policy which explains any limitations, exclusions, exceptions and special.  You may want to discuss these exceptions with an attorney before you close.

Schedule C is not shown on the blank copy above but it will be there when you get your title policy.  This is the schedule that shows the requirements that must be satisfied for the title policy to be issued. It may require information on marital status of one of the parties; if there have been any probates or bankruptcies they will be here also.  This is also where you will find the descriptions of mortgages.  If there are any mechanics liens, tax liens, judgments (you get the idea) this is where they will be found.  This is the part of the title commitment that the seller must resolve before the closing occurs. 

Spring TX first time home buyers title policyThe premium for a title policy is paid only once, at the closing of the sale.  The buyer and seller may negotiate who pays the premium.  Generally in Texas the title policy is paid by the seller for the new buyer but everything is negotiable so this is not always the case.  New home builders will typically NOT pay for the title policy and it becomes a buyer's expense.

Title insurance premium rates are set by the Texas Department of Insurance and are based on the property's sale value using a sliding scale.  You can check the Texas Title Insurance rates here. 

As a Spring TX first time home buyer I expect you will be getting a loan and this will be required by your lender.  If you are paying cash then you can make the choice as to whether you want title policy protection or not.  I recently had a buyer who seriously considered not buying the policy.  I told them it was their decision but I would require them to sign something saying I did not think this was in their best interest. They finally decided to buy the policy; my concern was you just never know what might come back to bite you without it.

This is a Spring TX first time home buyers series and as I add additional post I will add the links.  Please feel free to visit my prior post.

  1. Spring TX First Time Home Buyers Guide - Part 1 - Loan Pre-approval!
  2. Spring TX First Time Home Buyers Guide - Part 2 - The Web Search!
  3. Spring TX First Time Home Buyers Guide - Part 3 - The Home Search!
  4. Spring TX First Time Home Buyers Guide - Part 4 - What price do we offer!
  5. Spring TX First Time Home Buyers Guide - Part 5- The Home offer!
  6. Spring TX First Time Home Buyers Guide - Part 6 - The Texas option fee and your home inspection!
  7. Spring TX First Time Home Buyers Guide - Part 7 - The Title policy
  8. Spring TX First Time Home Buyers Guide - Part 8 - Why you need to live in an HOA!
  9. Spring TX First Time Home Buyers Guide - Part 9 -  What to bring to your closing!

 

Comment balloon 9 commentsMarchel Peterson • August 26 2009 05:06PM
Spring TX First Time Home Buyers Guide – The Title policy! – Part 7 –
share
I am continuing my Spring TX first time home buyer series. In this post we are going to talk about your Spring TX title policy. In Texas we close at Title companies and if you are getting a loan you are going to be required by your lender to have… more
Wordless Wednesday - Is this a meal flight? Yawn! Yawn!
share
This is Wordless Wednesday with words as this picture needs to be explained. This is our daughter's cat Elle. Our daughter is a flight attendant for a Charter company flying Internationally so Elle lives with us as our daughter is… more
Spring TX First Time Home Buyers Guide – The Texas option fee and…
share
This is my 6th post in my Spring TX first time home buyers series. I have chosen to discuss the Texas option fee and the home inspection in the same post. Your option period is typically that period of time where you do your home inspections. I… more
Spring TX First Time Home Buyers Guide – The home offer! – Part 5 –
share
In my last post we discussed what price a Spring TX first time home buyer might want to offer. In this post I am going to discuss the other items that we will need to negotiate. In Texas we have an 8 page resale contract. Price is what most… more
Friday Fotos - Tomball Cougar Art Sculptor!
share
The above oak tree was a causality of Hurricane Ike. It is on Baker Street in Tomball which I travel often. I watched the artist sculpting the tree from my car as I traveled back and forth on Baker Street. I figured the cougars had… more
Spring TX First Time Home Buyers Guide - What price do we offer? –…
share
I'm often asked by my Spring TX first time home buyers "How much under the listing price should we offer? " This is an excellent question. As I had told you at the end of part 3 (the home search) we will run comparatives going back 6… more
Spring TX First Time Home Buyers Guide - The Home Search! – Part 3 –
share
Now that you are pre-approved and have decided on the area you want to live in it is time to start searching for your Spring TX home. At this point you are going to have a list of homes that you have identified from your web search. We can then… more
Spring TX First Time Home Buyers Guide - The Web Search!! - Part 2 -
share
This is my second in a series of post for first time home buyers in Spring TX. Now that you are pre-approved for your home loan the next step is to start searching for your home. I have found that most buyers like to start looking at homes and… more
Nature & Marketing Contest - Taking off to find my new home!!
share
I just wrote a post yesterday about getting pre-approved for a Spring TX home loan This guy took me seriously and we are ready to take off and find his new home. Subcribe in a reader Picture taken by Tarina Peterson, all… more
Spring TX First Time Home Buyers Guide - Loan Pre-approval!! - Part 1…
share
I remember being a first time home buyer and the mystery that surrounded the transaction. This is the first post of a "Spring TX first time home buyer series" I hope this series will help to alleviate some of the home buying mystery. &… more