The Fryer Law Firm

404-240-0007

The Fryer Law Building
70 Lenox Pointe, NE
Atlanta, Georgia 30324

Education Center

Owner's Title Insurance

Despite the care and expertise that go into the title examination prior to your closing, there are hidden hazards that may arise after closing that even the most diligent title search would not catch or reveal. These problems may range from an inconvenience at best to a complete loss of your property at worst. Examples of such items include forged signatures on a deed, claims of unknown heirs, mistakes in the public records, defective foreclosures, undisclosed bankruptcies, recording gap issues, inchoate materialmen's liens, or fraud, which are undetectable by a title exam. Claims filed by third parties based on these and other covered title problems could lead to the loss of your home. Even an unfounded claim could result in your having to pay legal fees. Title insurance offers you financial protection against potential claims to the title of the property made by a third party. It guarantees that you have marketable title to the property you are purchasing.

There are two types of title insurance. The first is mortgage title insurance, which protects the lender in case there is a claim on the property. If you are obtaining a mortgage loan to purchase your home, that lender will usually require you to purchase a mortgage title insurance policy. This is typically handled by the lender's closing attorney and the premium charge is included among your other closing costs. The term of a mortgage title insurance policy is for the duration of the loan. Consequently, if you later refinance your home and payoff your current mortgage, the existing mortgage title insurance policy ends and you must purchase a new mortgage title policy for the new loan. This is true even if your new loan is with the same lender.

The other type of title insurance is owner's title insurance. This insures you, the property owner, and your heirs for as long as you have an interest in the property and even after you sell it. It is important to understand that the mortgage title insurance issued for the benefit of the lender offers no protection for you, the buyer. Owner's title insurance is also handled by the closing attorney. The premium charge for an owner's title policy is based on the amount of equity you have at stake in the property, and depends on whether you pay cash for your home or obtain a mortgage loan. For example, if you purchase a home for $300,000 and pay cash for it, your owner's title policy premium will be based on that $300,000 in equity. On the other hand, if you purchase a home for $300,000 and obtain a $250,000 loan, your owner's title policy premium will be based only on $50,000 equity in the home. At the Fryer Law Firm, you will always receive credit for any simultaneous issuance of a lender's and owner's policy, making our premiums among the lowest in metro-Atlanta. Additionally, consumers may choose between basic title insurance coverage and “enhanced” coverage. Especially if the property is not being surveyed, enhanced coverage may be desirable to protect consumers from issues that a survey may have revealed. For a complete analysis of the additional coverages in an enhanced policy as compared to basic coverage, please click here for Stewart Title's Comparison of Basic and Enhanced Owner’s Title Policy and click here for Chicago Title's Comparison of Basic and Enhanced Owner’s Title Policy analysis.

One of the most important decisions you will make at closing is whether or not you purchase an owner's title insurance policy, and should you request enhanced coverage. We at the Fryer Law Firm urge consumers to consider purchasing owner's title insurance, and in most cases enhanced coverage is preferred. Although an owners title policy is optional, if a buyer does not wish to purchase a policy, the attorney fees for the closing will increase due to the additional risk of conducting a closing without the protection of a national underwriter and the absence of the agency premium dollars used to offset the costs of closing a transaction.

The Fryer Law Firm is an issuing agent for Stewart Title Guaranty Company and Chicago Title Insurance Company. For more detailed information, you may contact them directly: www.stewart.com , 770-642-0420; www.ctic.com , 404-303-6300.

Surveys

A survey is a drawing prepared by a registered land surveyor based upon a physical inspection and measurement of property in conjunction with information contained in county land records. A survey precisely and accurately determines the size of the lot and any easements of record, encroachments, or dimension discrepancies affecting the property, and can also determine if the property is located within a flood zone. Surveys are required in most of the Metro-Atlanta counties before building improvements and additions such as decks or driveways, or planting or removing trees and landscaping along property lines.

A survey confirms for the buyer that their visual assumptions about the property boundaries are correct by disclosing exactly what portion of the property is being purchased as well as any structures located on that property. Furthermore, a survey may alert the buyer to legal description discrepancies, encroachment issues, or easement violations. Cases have occurred in which houses were built entirely or in part on the wrong property, resulting in the forced removal of the homes, in whole or in part. Even though “enhanced” title insurance may be available for owner-occupants of property to protect a purchaser from most catastrophic problems, conducting a survey in advance may help the purchaser avoid potential problems altogether.

A survey will not automatically be ordered for closing unless the purchaser's lender requires it. However, upon the purchaser's request, The Fryer Law Firm will order a survey as part of the closing process. If you would like to have a survey ordered, please contact us at least one week before your scheduled closing. The average cost of a survey is $375.00. Furthermore, upon request, we can provide contact information for local surveyors who will work directly with consumers to complete surveys during the contract due diligence period.