Before we go on to describe what the title insurance company is all about it's important to understand what title insurance is.
Let's say you buy a property and after several months of someone claims the same property as his. What would you do then? Filing a complaint against this person or try to tell that the property is yours and that you bought recently?
What if he's telling the truth? What do you do then? This is where title insurance comes into play. Insurance is not only a protection against financial losses due to deficiencies in title to real property but also against lien mortgages. Now, Title companies are the ones that offer title insurance and settlement services.
Furthermore, this insurance helps to protect the financial interests of the owners and lenders. According to federal law, namely, real estate settlement procedures act RESPA homeowners have the right to choose a title insurance company while purchasing or refinancing residential properties.
No lawyer, broker or bank can order the homeowner to select a particular title insurance company.
Lastly, remember that the cost of title insurance depends on the value of your property and that you need to pay only once. The insurance than protects your interest in the assets as long as you don't sell.