Guaranteed loan priority
Title insurance helps ensure that a loan will become a priority because it has the guarantee that it will be protected against any claims against you or the lender. Banks will be more at ease knowing that their investment in lending out money to you is protected through title insurance. Since lenders are in the business of making money they aim to have minimal amounts of risk when they approve someone for a loan and when they see that you have title insurance for the property you are buying they can make processing your loan a priority.
Other loans that do not have any guarantee of protection against an outstanding lien against the property may take longer to process as their is greater risk involved and in some cases, a lender will be off-put by the fact that their is no title insurance policy in place and can decide to not lend you the money. So even in some cases where someone may have decided to forego having a title insurance policy they may be required to have in order to do business with a lender.
Protection of your home equity
Nothing is worse than closing on a home and receiving a demand for payments against your new property. Over time your property should increase in value and build up equity that you can use in the form of a loan or take as profits when you sell your home. The amount of equity that you have will be determined on a variety of things such as the condition of the property and location. However, if you are required to pay for liens against your home that you were unaware because you didn’t opt for a title insurance policy the funds that you receive from your equity may have to be forfeited in order to pay off those liens.
Selling your home in the future
Having title insurance will help you when you go to sell your house in the future because the buyer will know that they won’t have anything come up unexpectedly to cause them potential money issues once they own the home. That means a deal is more likely to be made instead of scaring off potential buyers. Having peace of mind is priceless whether you own a home or are looking to sell one. Therefore it is recommended to have a title insurance policy to protect what you already have and you may eventually own.