Title Insurance

Obtaining Title Insurance

An important element to take into account when buying real estate is to ensure that the property has clear title. This means that there are no issues that may cloud the title. Potential title issues can be a boundary concern, an encumbrance, easement, a legal dispute, lien, an estate issue, forgery, or errors on the recorded deed.

As a seller, it is suggested that before putting your house on the market you should locate a copy of the title insurance policy issued at the time you purchased the property and copies of any relevant property documentation, such as a survey or Certificate of Occupancy (C/O) issued by the local Town and share them with your real estate attorney. If you are aware of a potential title issue, you should bring it to the attention of your real estate agent and attorney as soon as possible. For example, a potential boundary issue with a neighbor or the lack of a permit or C/O for work performed after you purchased the house. The earlier these issues are addressed, the smoother the sale of your property will go.

As a buyer, it is always advisable to purchase a title insurance policy. This policy ensures your ownership rights and protects your interests in the property. As soon as the contract of sale is signed by both parties, your attorney will order a title report on your behalf. This is a preliminary report that will tell us prior to the closing if there may be any issues that may impact the title. As soon as this report is received, it is shared with the seller’s attorney who will have the responsibility to ensure that any items that may have been flagged by the title search are cleared before the closing date. Depending on the seriousness of the issue brought up by the title report, there may be a negotiation between both parties,and as per the terms of the contract of sale, additional costs may be incurred by either party to clear the issue and ensure a clean title is passed at closing. The cost of the title report as well as the issuance of the title policy at the closing stage are borne by the buyer. This is a cost that as a buyer you should take into account and that your attorney should bring to your attention, since it will become due at closing.

Together with the title report, in certain cases it is also advisable to order an updated survey of the property. Usually, the cost of the updated survey is paid by the buyer as well. Fees for surveys vary and it is recommended to obtain more than one quote to compare prices. This is another closing cost to be taken into account for buyers when estimating how much funds will be needed at closing.

In Suffolk County, it’s the practice at closing for the seller’s attorney to prepare the transfer documents as well as the tax forms and for the title company to collect these documents and file them as well as take care of the recording of the deed. After the deed has been recorded, your attorney will mail to you an original copy of the recorded deed for your records.