“The Importance of Title Insurance: Why You Need It”


What is Title Insurance?

During the process of buying a home, many essential steps will need to be taken in order to complete this process. One of which is obtaining a title report and title policy. This procedure allows the buyer to receive ownership rights for the property from the seller. This process, however, can come with legal problems. Title insurance is the solution to these legal issues and is essential when it comes to buying property. While not required in New York and other states, it is still a good idea to purchase title insurance in the long run.

A title search is a process of examining public records to determine the legal ownership and history of a property. It is typically conducted during the home buying process to ensure there are no outstanding liens or legal disputes regarding the property.


Why Do You Need It?

There are many scenarios in which buying a property can cause problems. Title insurance is a form of protection to a buyer’s property, a title insurance company will conduct a search of issues such as outstanding liens, back taxes, and conflicting wills. Generally, the one-time premium for title insurance is paid at closing, and the policy remains in effect for as long as the owner or their heirs have an interest in the property.


How Do You Hold Title?

Holding real property, and thus title, may be done in one of several ways, depending on the state. Some of the common methods of acquiring real property are:

Sole Ownership, which is the simplest way to hold a title on a property. One person holds the title and is often used by those who live alone/are single. In some cases, married partners can choose one person to have sole ownership over the title if one person is willing to sign off on any rights to the property.

Tenancy in Common, two people or more get to individually own a percentage of a property. Each owner is allowed to sell their property at any time but does not affect the other owner’s percentage of property. The percentage of property does not revert to the other owners automatically, for example if one owner passes away.

Joint Tenancy with Rights of Survivorship, this occurs when two or more people jointly holds the title. In the case of a tenant passing away, the interest in the property will automatically transfer to the surviving tenants. If only one joint tenant survives, the title becomes sole ownership.

Tenancy by the Entirety, when a married couple is treated as a joint tenancy, so each individual owns 100% of the property. Each individual cannot alter the other’s ownership in property without the other’s consent but will have full rights to the property if the other should die.

Community Property, while married, partners can own half of the property each. This only applies to some states in the U.S.

Trust, an arrangement is made whereby legal title property is transferred by a trustor to a person called a trustee, the right to hold title to property or assets for the benefit of a third party, the beneficiary.

Corporation, Limited Liability Company, or Partnership, a corporation, LLC, or partnership can hold title to a property. Each has different arrangements that affect the title.


Title insurance is crucial for protecting an investment in a property. It provides coverage for many issues or defects with the title that may arise after the purchase. Without it, there could be costly legal battles and financial losses. In short, title insurance provides peace of mind and protects your investment in the long run.