Our first step after receiving the signed sales contract is to verify the information in it with the parties and perform a title search for the property. Our abstractors conduct a search of the land, judgment, and other official county records where the property is located. This “search” generates a comprehensive report outlining anyu possible problems with the title of the property. We examine the report to determine what documents will be required to insure the conveyance or refinance of the property.

A title must be deemed “good and marketable” before the settlement process can continue. The results of the title search identify (among other things) the current owner of the property, any liens on it, and any limits on how an owner can use the property. Our examiners will review the title search report to determine what (if anything) must be done in order to clear the title to the property so that the buyer can obtain its (and its lender’s) goal of a “good and marketable” title. If the title to the property is not found to be insurable then it is not recommended to purchase or refinance the property.

A location drawing or survey is a physical drawing done by a surveyor hired to complete this task. Depending upon the type of survey required, it may show any or all of the following: legal boundaries; location(s) and size(s) of any buildings on the property; set-back lines; easements; and any other restrictions and information. It is advisable to determine whether a prior survey exists. A recertification of a prior survey is normally less costly than a new survey.

Whether or not you get a survey on your property depends on several things. As a buyer you need to have a survey done to insure there are no major defects with the land and its improvements. Most contracts leave it up to the buyer to decide if they wish to purchase a survey. If you are paying cash for the property there is no requirement for a survey. If you are obtaining a new loan to purchase the property then a survey typically will be required. The lender wants specific title insurance coverage pertaining to the boundary lines of the property. Coverage can only be given by the title company if they review and approve a copy of an acceptable survey. Survey’s are not required on “most” Condominium purchases. New surveys are generally not required when you are refinancing your property, providing you have a copy of a survey from when you purchased it and you can give written assurances that you have not made any changes to the outside exterior of the property (including adding a pool or fences).

Most lenders require a location drawing of the property to ascertain that others (such as adjoining property owners) have not encroached on the property being purchased, improvements on the property neither extend beyond the lot’s legal boundaries nor are placed over easements of record, and there are no violations of building restriction lines or other regulatory restrictions. Our examiners will review the completed drawings, and if any problems are found, Homestead Title of Pinellas, Inc. will work with all of the parties involved to find an acceptable solution that allows the closing to move forward.

Title insurance protects against a loss to the lender or the owner in the event that the title to the property is other than as insured. Title insurance is an essential part of virtually every residential and commercial real estate ownership transfers. It is purchased at settlement, and the title insurance policies are issued shortly thereafter. Although it can be one of the higher costs of closing, buyers should be aware that it protects them against potentially disastrous losses.

There are two (2) types of title insurance policies: lenders and owners. Lender’s title insurance is required by lenders to protect their interest in the property from possible title defects. Buyers have the option of purchasing owner’s title insurance to protect the thier investment. The property value to the buyer is often greater than the loan on the property. Notice that while the lender’s policy expires when the loan is paid off, the owner’s policy continues as long as the owner has a vested interest in the property. It is important to realize that title insurance premiums are paid only once, at the closing. Owner’s title insurance cannot be purchased after the closing except in connection with another transfer or a full title search concerning the property.

The concept of title insurance is generally misunderstood. Unlike most insurance which protects against the risk of future events, title insurance exists to eliminate losses due to title defects which occur as a result of things that happened in the past.

Even the most careful title search will not reveal some situations or events that could cast doubt on your title to the property. Title insurance policies generally cover losses for mistakes made in researching, abstracting and examining the title as well as losses caused by items that cannot be discovered by examination of the public records. These include things such as mistakes in the public records themselves, fraud or forged title instruments or documents, undisclosed heirs to the previous owner, adverse possession, and other undisclosed prescriptive rights, etc. A title insurance policy will financially protect the insured party by paying its legal defense fees and monetary claims, should unexpected items that are not of record arise.