It comes up a lot in discussion and it is one of those topics that might be tough to encapsulate in a concise discussion with a client out there in the field. So, I thought I might give it a try to help if ever you are asked. Inevitably your buyer clients will be buying title insurance along with the purchase of their new property and it is not free. Quite fairly, even though their lender contract will make this insurance mandatory, the clients may have questions. Firstly, the lender requires this title insurance purchase in lieu of a survey which people often used to have to buy back in the old days, so it is not that bad in comparison. As to what it gives the client, it essentially protects them from things that cannot normally be seen through the lawyer’s process of transferring title into their name and clearing all registered matters that are on title. These are unseen or hidden issues with title to a property that can crop up after closing and possession that would not normally be visible in the lead up to the property closing, using all available on-time searches. These can include things like an undisclosed spouse or partner coming back and claiming homestead rights in the home, someone claiming a trust interest in the property, a lien being registered after possession by an unpaid contractor, or any work order attached to the property by a government. It can protect against unpaid tax arrears or utility issues, or it can deal with permitting issues or encroachments of building which are problematic with the lot lines and setbacks. There are also less common issues like fraud, forgery or false witnessing that could come into play. All good things to be protected against.
**as always, every situation is different and laws can change, if you have doubts, call someone