Rare is it in your life you’ll make a more significant investment than buying a home.
To the above point, the average New Jersey home costs $451,559. That number amounts to a nearly 6% year-over-year increase.
It’s not just money that you’ve invested either. Think of all the hours you worked to save enough to make that first down payment. That’s on top of the additional work you put into procuring the funds required to keep up with your mortgage.
Really, you’ve spent your whole life striving toward buying a home. Owning a real estate property is one of those benchmarks that help solidify your present and future. So, you’ve put your nose to the grindstone and are making it happen as we speak.
Alternatively, say you’re purchasing an investment property. Many of the above sentiments still apply. You’ve poured time and resources into this business venture, and you need it to pay off–and it should pay off. ZipRecruiter reports the average annual pay for New Jersey real estate investors is $115,680.
There’s something else to consider here.
Real estate is supposed to be a relatively safe, risk-averse bet. Homes appreciate in value almost automatically. Provided you can keep up with your mortgage (and you have favorable terms), you can sell your home in the somewhat distant future at a substantial profit. Investment property will rake in the returns, too –especially in New Jersey, where rent costs continue to skyrocket.
You could be purchasing a home to inhabit for decades or as a source of income (or both). Either way, real estate investing is one of the more surefire ways to generate long-term wealth.
However, real estate investing isn’t always cut and dry. You could seemingly have all your ducks in a row and run into issues that could send you into a financial spiral.
Sometimes, it’s hidden problems within the home you weren’t told about by the previous owner or their real estate agent. Suddenly, you end up on the hook for repairs and renovations on top of the home purchase.
Another potential unforeseen snafu with your home–and the topic of this article–is issues regarding defects associated with your real estate property’s title.
What Is A Real Estate Property Title?
When we say “title,” we’re referring to the document listing the legal owner of your real estate property. Unlike personal property titles, real estate property titles include physical real estate property and ownership/usage rights.
Real estate property titles must be transferred and cleared when the asset is sold, so the ownership transfer may occur.
Multiple title methods can be utilized, each with specific pros and cons based on a homebuyer’s circumstances and how they want ownership to pass in case of divorce, sale, death, etc. Here are the most common title-holding methods:
- Sole ownership
- Community property
- Joint tenancy
- Tenants by entirety
- Tenancy in common
With all this said, various metaphorical landmines can sully a real estate property title. We’ll discuss them in the next section.
What Kind Of Problems Can Arise From Real Estate Titles?
It’s possible to purchase a home and inherit the defects encumbering your title rights and claims.
Below are examples of potential real estate title defects:
- Forgeries
- Public record errors
- Missing heirs
- False impersonations of the prior owner
- Boundary/survey disputes
- Unpaid mortgages
- Other debts
These issues and defects are only the tips of the iceberg.
So–how can you protect yourself (and your substantial real estate investment) from the pitfalls of these defects? The answer is simple. Protect yourself with real estate property owners title insurance and partner with the top title insurance company in New Jersey, Clear Skies Title Agency.
What Can A Title Insurance Company Do For You?
As a top-performing title insurance company, Clear Skies Title Agency will locate, neutralize, and eliminate all losses or risks that could occur due to title defects. More to the point, we’ll insure you against these problems before they rear their ugly heads.
Your title insurance policy will cover losses/risks stemming from title issues, such as:
- Title forgeries
- Unknown liens
- Public record errors
- Unknown encumbrances and easements
- Impersonations of the previous owner
- Unreleased/unpaid debts (e.g., mortgages)
- Falsified deeds
How Can A Title Insurance Company Help Prevent Problems With Title Defects?
Since title insurance is purchased before you receive the property title, you have proactivity on your side.
Specifically, the Clear Skies Title Agency team performs a title search on your behalf. We examine public records to discern and confirm the legal ownership of the property you wish to buy. We also discover whether any claims or liens are associated with the property.
We’ll inform you if we find encumbrances in the title. From there, you can decide if the property remains suitable for sale (as these issues can be dealt with accordingly and not impede a sale if you have knowledge of them).
There are hidden risks that can’t be ascertained through public records. Typically, these veiled encumbrances aren’t legally above board (e.g., forgeries) but can still cost you significantly if you don’t have title insurance.
Your title insurance policy would cover the costs if a title defect wasn’t discovered during the search process (provided the defect falls within your coverage’s scope).
Something else to consider is unlike homeowner’s insurance, title insurance is a one-time fee that’s often–at most–1% of the sales price. You won’t be stuck paying your title insurance fees on a monthly or annual basis. You invest once, and your title claim is protected from that point forward.
Work With The Title Insurance Company That Puts Your Needs First.
At Clear Skies, providing title insurance is more than a policy. It’s about putting our customers’ needs first and ensuring transparency and straightforward communications.
We apply our vast industry and local New Jersey knowledge to protect you from any pitfalls caused by title defects. Schedule a call with us today to learn more.