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What Title Insurance Does (& Doesn't) Cover in Florida

Posted by Kim G. Bosshardt | May 09, 2023 | 0 Comments

Imagine the nightmare of buying a dream home in Florida and finding out that you don't actually own it. The reality is that title insurance provides protection against this kind of legal disaster, but many potential homeowners are left wondering what exactly does title insurance cover?

In Florida, there's more than meets the eye when it comes to understanding your coverage under title insurance and what might not be included. When making such an important real estate purchase, being fully informed about the details of title insurance can help save money and prevent unwanted surprises down the road.

At Bosshardt Title, we know that purchasing a property can be overwhelming, but understanding the ins and outs of title insurance is essential for protecting your investment.

don't worry-this article will explain exactly what title insurance does (and doesn't) cover in Florida and how you can get the help you need today.

The Basics of Title Insurance in Florida

Title insurance helps protect you from hidden problems regarding your property's past ownership or other issues, such as undisclosed debts or unpaid taxes.

The policy covers both parties-the buyer and seller-and can be used for residential and commercial properties. It protects against fraudulent documents filed on the same piece of property by an imposter claiming ownership.

Furthermore, it will defend against claims made by others who believe they have a right to the property even after it's been transferred to the new owner. With all these protections in mind, it's easy to see why title insurance is so important when purchasing real estate in Florida.

What Title Insurance Covers

Title insurance covers four key areas:

  1. Liens - Your policy will cover liens placed on the property by creditors.
  2. Enforceable claims - If someone makes an enforceable claim against your title, your policy will provide legal defense for you.
  3. Encumbrances - Any rights or interests that burden or impair ownership, such as easements, covenants, and assessments, are covered under most policies.
  4. Title Defects - This includes errors in public records regarding previous ownership or document preparation mistakes related to the sale itself.

Ultimately, these protections ensure that you have peace of mind when buying property in Florida.

What Title Insurance Does NOT Cover

Title insurance does not cover every issue that could arise with a property.

Most notably, it does not protect from:

  • Claims by people who have an ownership interest in the property but are not disclosed on the title report or deed (creditors, previous owners, heirs, ex-spouses, etc.)
  • Potential issues related to zoning laws
  • Boundary disputes between neighbors
  • Environmental contamination
  • Fraud or forgery involving documents used in the sale of the property

In addition, title insurance won't protect you if they choose to purchase without obtaining home survey information about the land or improvements located thereon. Title policies don't guarantee that all taxes due have been paid, nor do they insure against encumbrances created after closing.

As such, you must research all aspects of your real estate transaction thoroughly before agreeing to close on a deal so you can be sure what risks are covered and which remain uninsured.

Exploring the Different Types of Title Insurance in Florida

When it comes to title insurance in Florida, there are two types of coverage: owner's title insurance and lender's title insurance.

Owner's Title Insurance covers losses resulting from defects that existed before you bought your property, while Lender's Title Insurance protects the financial institution that loaned you money to purchase the property against such risks.

Both policies protect against any disputes or claims brought by third parties regarding ownership of the property. It also provides funds for legal defense if necessary but does not cover consequential damages related to zoning laws or building code violations.

TIP: Before signing on the dotted line, make sure you understand what kind of protection your policy offers and which encumbrances may be attached to your policy so you can ensure that all potential issues have been addressed before closing!

How to Get Title Insurance in Florida

Safeguarding your title is like a sailboat ride in calm waters. With the right insurance, you can relax and enjoy the journey knowing that you are covered if something unexpected happens. Typically, the party paying for the policy per the terms of the contract will determine the closing agent. However, if you are refinancing your property, you have the ability to choose your closing agent.

Fortunately, obtaining title insurance in Florida is straightforward. Follow these four steps.

  1. Find an experienced local title insurance agency to work with. A reputable title company can guide you through the process so that all necessary documents are collected and reviewed before closing.
  2. Figure out the cost. The cost of the policy may vary according to the type of coverage requested. We are happy to give you a title quote so you know what your anticipated closing costs will be.
  3. Submit documents. Once all documentation has been submitted and approved by both parties involved in a transaction, a commitment letter outlining details of the policy's coverage will be sent out to everyone involved. This document verifies that both buyer and seller have met all conditions required for issuing the policy.
  4. Receive your deed. Your chosen title agency will write up an official deed conveying ownership rights and issue a final policy after closing day arrives.

Secure Your Investment-Call Bosshardt Title Insurance

Having a good understanding of how title insurance works in Florida will help you feel more confident in your decision-making process as you navigate through the various stages of buying a home.

With this information, you'll know that your investment is protected by reliable coverage. Seal the deal on your future-call Bosshardt Title Insurance today.

About the Author

Kim G. Bosshardt

Board Certified Real Estate Attorney


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