I'm refinancing, why do I need title insurance?
When you refinance you are obtaining a new loan, even if you stay with your original lender. Your lender will usually require a new title search and Loan Policy to protect their investment in the property. You will not need to purchase a new Owner's Policy; the one you bought at closing is good for as long as you and your heirs have an interest in the property.
Even if you recently purchased or refinanced your home, there are some problems that could arise with the title. For instance, you might have incurred a mechanics lien from a contractor who claims he/she has not been paid. Or you might have a judgment placed on your house due to unpaid taxes, homeowner dues, or child support for instance. The lender needs reassurance that the title to the property they are financing is clear.
Ask if you qualify for a "refinance" rate, sometimes called a "reissue" rate. These rates are not available in every state, and you might have to meet some criteria to be eligible, so be sure to ask.
How To File A Claim
An owner's policy of title insurance is intended to provide the homeowner with peace of mind about their legal rights to real property.
Whenever the homeowner has any question or concern about his or her rights, he or she should promptly notify the title insurance company whose name appears on his title policy. The title policy includes instructions for contacting the title insurer, usually at the end of the "Conditions and Stipulations" section within the policy.
If you are unable to locate your policy, or are unsure whether you purchased a policy, you should contact the title company, title agent or attorney that handled your purchase and inquire about your coverage. You can determine if you have title insurance coverage by reviewing the settlement statement ("HUD-1") provided at the closing of your purchase, which itemizes receipts and disbursements by the closing officer. For example, charges for an owner's policy of title insurance are listed on line 1110 of the standard HUD-1 form of settlement statement. Contact information for the title insurer may also be found in telephone directories, on the internet, or by inquiry to your state department of insurance.
When giving notice of a potential claim to the title insurer, you should include the property address, a brief statement of the question or matter that concerns you, copies of any claims documents received, and a copy of your owner's policy (if available).
Remember, the broad coverage of title insurance includes protection against frivolous claims, or "clouds" on title that may not present an immediate problem. So it's best to contact the title insurer promptly, as soon as you have any question or concern about your legal rights with insured land.
