50 Ways To Lose Your Home, And Only One Way To Protect It, An Owner’s Title Insurance Policy

by Rich Vetstein on September 28, 2010 · 4 comments

in Massachusetts Real Estate Law, Title Defects, Title Insurance

Essential-Paul-Simon-395x298-staffpicks_0She said it’s really not my habit to intrude
Furthermore, I hope my meaning won’t be lost or misconstrued
But I’ll repeat myself, at the risk of being crude
There must be fifty ways to leave your lover
Fifty ways to leave your lover

“50 Ways To Leave Your Lover” (c) Paul Simon

50 Ways To Lose Your Home

As Massachusetts real estate closing attorneys, we are often asked by buyers-borrowers, “Why should we get an owner’s title insurance policy if you are already doing a title examination?” This is a really good question, and the perfect lead in to a conversation about of the coverages and cost of a Massachusetts owner’s title insurance policy. Do you know the Paul Simon tune, “50 Ways to Leave Your Lover”? Well, there are more than 50 ways to lose your home without an owner’s title policy. Simply put, don’t take the risk of foregoing title insurance. It’s not worth it.

Title Insurance Basics

Title insurance protects homeowners from financial loss in the event that certain covered problems develop regarding the rights to ownership of their property. While all borrowers of conventional mortgages will receive a certification of title by a Massachusetts real estate closing attorney that their title is “good, clear and marketable,” there can be a host of hidden, off-record title defects that even the most careful title search will not reveal. In addition to protection from financial loss, title insurance pays the cost of defending against any covered claim.

50 Ways to Lose Your Home

Like the Paul Simon song, there are at least 50 ways you can lose title to your home if you don’t get an owner’s title insurance policy. The vast majority of these situations will not be ascertained in a typical title examination.

  1. Forged deeds, mortgages, mortgage discharges/satisfactions
  2. Deeds executed by a mentally incompetent or insane person
  3. Deed from a minor subject to avoidance
  4. Unauthorized deed from partnership or trustee
  5. Deed by foreign person vulnerable to challenge
  6. Deed from a corporation unauthorized by by-laws or resolution
  7. Undisclosed divorce of person who conveys as sole heir of a deceased former spouse
  8. Deed signed by mistake or under financial duress
  9. Deed signed under defective power of attorney
  10. Foreclosure deed where underlying foreclosure was defective
  11. Ineffective release/discharge of prior mortgage
  12. Deed of deceased not joining all heirs
  13. Missing heirs claiming interest in property
  14. Transfer void under contract law
  15. Deed includes protected public trust wetlands
  16. Ineffective release of mortgage subject to bankruptcy avoidance powers
  17. Ineffective mortgage subordination
  18. Mistakenly indexed deed/release
  19. Undisclosed federal/state tax lien
  20. Undisclosed spousal/child support lien
  21. Undisclosed lawsuit affecting property
  22. Undisclosed restrictions/covenants
  23. Incorrect legal description
  24. Errors in tax records
  25. Erroneous tax release
  26. Misinterpretation of wills
  27. Deed without right of access to public way
  28. Access eliminated by foreclosure
  29. Defective notarization
  30. Forged notarization
  31. Improperly recorded or indexed deed/mortgage
  32. Deed acquired through creditor fraud
  33. Mechanic’s lien claims
  34. Incorrect property boundaries
  35. Encroachments of buildings
  36. Federal or state estate tax liens
  37. Preexisting violation of subdivision laws
  38. Preexisting violation of zoning laws
  39. Deed from joint owner without joint tenant joining
  40. Undisclosed right of first refusal
  41. Undisclosed easement affecting property
  42. Undisclosed party wall agreement
  43. Special assessment liens
  44. Adverse claim of vendor’s lien
  45. Discovery of un-probated will
  46. Claims for prescriptive rights, not of record
  47. Easement does not conform to recorded instrument
  48. Incorrect survey
  49. Deed following lawsuit where all parties of interest not joined
  50. Deed executed under falsified power of attorney

Getting an owner’s title insurance policy is simply a “no brainer.” I did the title to my own home in Sudbury, and I got an owner’s policy. It’s a one time premium paid at closing, and stays in effect as long as you own your home, through refinances and even the death of a spouse. Please contact us about carriers, rates and coverages.

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