Posted by Kristine-CA on July 25, 2003 at 01:29:27:
First, a question: Where are you located where title insurance costs 2-3K? For what property values? The minimum policy here is about $400.
One thing that title companies will do (which you can do too) is get signed statements of personal information from the owners. And they will find all kinds of liens and judgments that you wouldn’t find if you didn’t have this information. For example, using other names and addresses and dbas of the owners will often show other recorded docs.
Regarding other liens that you won’t find at the recorder’s office: Most property tax defaults and special assessments are not recored docs per se, but are public information. Also, in some areas, certain utilties run with the property. For example, water bills.
In my opinion, title insurance is a necessity and unless you like the research, I don’t advise that you do it yourself. It’s essentially a waste of your time unless you don’t think you will ever be needing lender funds or selling the property. There is a lot more to worry about besides liens. The chain of title may look good to you, but unless you are really good at reading deeds and legal descriptions and checking for the same details that title insurer underwriters are checking, you could be buying something that a title company will not insure without some kind of deed corrections, etc.
Title insurers are insurance companies and are just like the rest of the insurance industry. They write whatever policies and requirements they please and will do just about anything these days to avoid a claim. Why second guess them?
So, if you plan to re-sell or ever finance the property, I strongly suggest title insurance.
I love this site, and the help that people offer, both experienced and maybe not so.
I had a question, the state in which I live has online access to the recorders office. And I use it regularly.
My question, from what I understand, all a title company warantees is what is publically recorded, thus which is on the same recorders site that I have full access to.
Is there anything else that paying for title insurance and paying for a prelim search that I am not doing myself? I know for a fact that title companies dont warantee non-recorded documents, so what else do they do that brings value for paying 2-3k for their services?
I sure dont want to do anything that would cause me legal problems, but I also dont mind doing the leg work and benefiting from doing so.
I had a rehab property that I dropped because I confronted the owner about how he came upon the property…he is a mortgage broker, the previous sellers were going into foreclosure, they couldnt qualify and he said he would buy the house and let them live there for a year…blah blah…I searched by the previous owners, and the NOD was for some piddily ammount, (35k on a 150k property)…so he bought it from them. I asked what happened to the difference of the owed ammt and the new mortgage…he claimed there were other leins/obligations than just the one being foreclosed on… I didnt find a THING on the recorders site…but he was adament about there being other leins.
So this made me question if I ought to be paying the hefty fees of title search, if there are other ways that leins are listed or shown that arent on the recorders site.
Sorry for the length, but this has been on my mind for some time.