If you’re in the final stages of purchasing a home in Parry Sound or the Muskoka region, you may have come across the term Title insurance and are wondering whether this is something you need before you seal the deal.
The term ‘Title’ basically means that you legally own the property. When the previous owner of your new home signs the deed over to you, Title is automatically transferred to you and registered by the municipal government.
Title insurance basically guarantees that you are protected against any loss that may occur that is related to a property’s ownership or Title. This could include covering you against any errors or mistakes in public records and surveys, property encroachment issues, liens that may exist against the property, unforeseen Title defects or anything else that would stop you from selling or mortgaging your newly purchased property in the future. Most Title insurance policies will also protect you from Title fraud.
There are a few things that Title insurance does not cover, however, and it’s important to be clear about what these are. Title insurance is not the same as property insurance, which means that Title insurance does not protect against damage to your property or theft. Title insurance also does not protect you against things like unrecorded liens or encroachments, Indigenous land claims, any zoning bylaw violations or anything else that is not directly related to Title and ownership.
When considering Title insurance, it’s important to know that there are different types that you can opt for. Title insurance is available for both residential and commercial properties. You can also choose between an Owner’s Policy, which protects against Title-related losses highlighted in the policy (to a maximum amount). There’s also a Lender’s Policy. In comparison, a Lender’s Policy protects the lender from losses in the event that the mortgage on the property is, for some reason, invalid.
In Ontario, it’s not actually necessary to purchase Title insurance when buying a new home. In fact, Title insurance is usually required by a financial institution or private lender when they mortgage a property. Despite this fact, Title insurance is still definitely something that you should consider. A real estate lawyer can help you determine whether purchasing Title insurance is the best step for you to take.
As experienced lawyers specializing in real estate law in Parry Sound, we’ve helped many clients through the process of buying and selling a home, including determining whether Title insurance is a good idea. If you’re thinking about purchasing in Muskoka and are still not sure whether Title insurance is right for you, set up an appointment with us today. We can provide an expert recommendation and help you through the process. Call us at 1-705-746-6444.
