Frequently Asked Questions

What Is Title Insurance?

Title insurance is a contract to indemnify against losses arising through defects in title to real estate. As a rule, a title company will not insure a bad title any more than a fire insurance company will issue a policy on a burning building. However, title companies can sometimes overcome some technical objections that might be raised by a title examination. In simple terms Berryville Abstract and Title Co . represents that its underwriters agree:

1. To defend your title in the courts, as insured, at its own expense.
2. To correct or clear the title when possible.
3. To promptly pay you for your loss in the event of an unsuccessful defense of your title.

Why Title Insurance?

When you buy a typewriter, a television set, a car, or a thoroughbred, you usually have no need to know whether the former owner is married, single or divorced. You are not interested in whether or not the owner has paid taxes or if there are lawsuits or judgments against the owner. When you buy a home, though, it is necessary to have all that information...and a great deal more. Whenever you consider the purchase of real estate, you should be aware that there may be others, in addition to the owner, who could have "rights" in the property you are acquiring. There may be a work contractor, governmental agency, or any number of individuals who have perfectly proper claims against the property.

Many people say: "But I have a deed. Isn't that all I need ?

No. A deed is not proof that the seller actually is the owner. Nor does it contain information regarding the rights others might have in the property.

"Can't I find out about their rights from the public records?"

What happens at a closing?

The mortgage loan closing (or settlement) is the formal meeting at which you take official ownership of the property. Actual possession of the property varies according to local practice and the terms of the contract. In some areas, possession is given to the buyer on the day of closing. In other areas, this occurs a day or two after. At closing, the buyer requires that the seller prove the title (ownership) is complete and free of anyone else's claims. Technically, two separate closings occur at this time: the closing of your loan and the closing of the sale. The closing meeting is typically attended by the buyer and seller (and their attorneys if they have them), both real estate sales professionals, a representative of the lender, and the closing agent. The meeting takes about one half-hour to one hour and is usually held at the closing agent's office. In addition to a number of other activities, you'll be required at that time to review and sign various documents relating to the mortgage loan and pay closing costs.