In my June 17th column (which is archived at JimSmithColumns.com), I wrote about “title lock” insurance, which is being widely advertised. The headline for that column said it all: “Don’t Fall for ‘Title Lock’ Services. They Are a Waste of Money and Don’t Provide Much Protection.” Unfortunately, some readers thought I was referring to title insurance and asked me if it was really necessary.
Yes, any purchase or sale of real estate should include the purchase of an “owner’s title policy,” typically paid for by the seller. This policy in unlike other insurance policies, in that it is a one-time premium issued by a title insurance underwriter and sold either directly by the underwriter or by a title agency. It insures the buyer of the real estate against any liens against the property recorded with the county clerk and recorder.
If the purchase is being financed by a lender, that lender will require a “piggy-back” lender’s policy (paid by the buyer) from the same underwriter covering the lender against such claims up to the amount of the loan. (The owner’s policy covers the buyer up to the full purchase price.) Title insurance should provide all the protection a buyer needs.
I also recommend requesting a credit freeze from the three credit bureaus. It costs nothing, and it prevents anyone from taking out a loan in your name and disappearing with the proceeds.
Every year you should get a notification of value from your county assessor. If you didn’t get one this year, you can look up your address on the county assessor’s website to make sure your home is still in your name.
In Jefferson County, you can visit http://assessor.jeffco.us. Use Google to find other county assessor sites.
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