All posts tagged: Risk

What You Don’t See Can Really Bug You

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In June 2014, my band OE-2-KB (Old Enough-2-Know Better) had a gig along the St. Johns River.  It had rained all day, but Eddie said he had a thousand-foot tarp that we could put over everything.  So we started setting up and we were watching the radar…and wondering if that tarp could really cover all of our band equipment.

There were a few little blind mosquitoes around, but they didn’t bite, so no big deal.  We played our first set, took a break, and came back.  By then it was very obvious the atmosphere had changed—there were blind mosquitoes everywhere!!  At first I thought they were just around the lights, but they were everywhere!!  Still, they didn’t bite, so we started our second set.

It was like the plagues of Moses—the blind mosquitoes were in our mouths, in our ears, and all over the keyboards, the guitars, the drums.  I’ve never seen anything like it before.  My brother, Rusty, had pages of music stuck together with dead bug bodies.  We had been worried about the rain, but what we didn’t see coming that stopped the music.  The same can be true of real estate title claims.

Owner’s Title Insurance addresses not just the title problems you can see in public records, but also the hidden risk.  

Home ownership should be hassle-free.  You should be able to check the radar, have a big tarp handy to cover everything, but even so, challenges to your ownership can happen.

Most property disputes are something small—not a big claim like fraud or forgery on a deed, or someone trying to claim ownership of the entire property.  Usually it’s a matter of feet, an encroachment.  It’s the freak bizarre things, and you just don’t see them coming—that’s why you get title insurance.

Title Insurance provides an initial service when you pay for it—a title search—and provides a secondary service—legal representation and / or compensation of the policy amount—at no additional charge to you should the title come into question.   Title Insurance can’t always prevent an attack on home ownership rights, but it can shield the Homeowner from court costs in a legal defense of property title.

Title Insurance helps keep title claims from bugging you.

(If you’re looking for OE-2-KB, you can keep up with us on Facebook at https://www.facebook.com/OE2KB or our band website at http://www.oe-2-kb.com.)

 

Stephen CollinsWhat You Don’t See Can Really Bug You
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Payments & Costs

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Title Insurance fees are regulated by the State of Florida. The base rate is $5.75 per thousand up to $100,000 and $5.00 per thousand thereafter up to $1 million. That’s your one-time fee at your real estate closing—it’s one EASY payment that can prevent MEGA payments in litigation fees should your ownership be questioned. I promote title insurance because it’s a relatively small amount compared to the risk of legal defense cost, which can be mightier than your bank account and all your savings put together.

Title insurance pays for your legal defense should someone challenge your property ownership. It pays all your filing costs with the court and for your attorney. The bad news is that your homeownership is in jeopardy—the good news is that your title insurance pays the cost to defend it. Title insurance gives you that peace of mind for as long as you or your heirs have a financial interest in the property. It pays valid claims and covers the cost of a legal defense of your ownership. And it’s a lot cheaper than paying for an attorney yourself.

It also pays out the amount you are insured for should your court case does not come out in your favor. Yes, just because your title search showed up clean and just because you paid for your real estate, someone could have a valid claim to your property. You might still lose your house. Title insurance pays for your legal expenses plus the amount you’re insured for should your defense fail. It protects you against financial loss even if you have property loss.

You could lose your home, but you don’t have to lose your shirt.

Stephen CollinsPayments & Costs
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Easter Egg Hunts & Title Searches

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The problem with using hard boiled eggs at an Easter egg hunt is that you might not find them all. Furthermore, by the time you realize you’re missing one, you might not want it anymore. What’s that smell? Yeah, it ain’t good. The same can happen with real estate title searches.

When you go to buy a house, you don’t really want to find a lot of obstacles to your ownership, but, on the other hand, you don’t want to miss any either. You have a title search done before you buy—you want to make sure what you spend your money on is going to be exclusively yours, and that you don’t have to share a bathroom with Mrs. Henley next door because of overlapping surveys—oops! It happens, it’s fixable, but that’s the kind of thing you want to know about ahead of time. You want to set clear boundaries from the start so Mrs. Henley doesn’t show up one morning in her shower cap and bathrobe.

So you have a title searcher look for all the problems he can find. How many Mrs. Henleys are there who might come forward and claim a part of your property or all of it? Yeah, you want to know about those people ahead of time and deal with them up front.

What if the title search misses someone? What if there’s one egg out there, hidden under-recorded deeds at the courthouse or a relative nearly faded off a family tree who may have financial rights to your land or home? That bad egg could be sitting out there in the sun, getting more rotten.

Title insurance cannot protect you from rotten eggs. If you pick up an egg and it seems unnaturally light, throw it as far as you can and hope you don’t hit your sister. Title insurance, however, can protect you financially from challenges to your home ownership.

If you’re buying a home or land, happy title searching. I hope you find all the issues which may complicate you purchase and ownership—it’s best to know about and deal with those ahead of time. If you already own real estate, I hope you have title insurance in case a problem arises.

Happy Easter, and may you find all the eggs!

Stephen CollinsEaster Egg Hunts & Title Searches
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You Might Still Lose

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Homeownership comes with the responsibility to defend that ownership, even against hidden risk. It is not your fault someone at the courthouse didn’t record a deed, or that the previous owner forgot to include an estranged daughter in the will, but you are responsible to defend your ownership against these kinds of problems.

If someone challenges your ownership of your home, that person could be right. It sounds ridiculous, but yes, someone could have a valid claim to your property. Just because a rigorous title search didn’t reveal the estranged daughter of the previous owner doesn’t mean she doesn’t have a legitimate right to claim. Title insurance doesn’t prevent that kind of thing—it pays for it. Risk to ownership is inherent with real estate ownership itself.

Furthermore, title insurance doesn’t guarantee you’ll win in court. No one can do that, not even my brother, Rusty, even though he thinks so. If you have title insurance and the estranged daughter of the previous owner challenges you in a court of law, your title insurance will pay your legal fees—it pays for your attorney and all legal-related expenses of your case. The bottom line is you might still lose your house, in which case title insurance pays your legal expenses plus the amount of money you insured the house for.

Title insurance pays valid claims and legal fees to defend your ownership. The big advantage of title insurance is that it protects you from financial loss. Nobody wants to lose all their money and their home. Title insurance keeps your shirt on even if you lose your house.

Ownership challenges are not pretty and they can be difficult to deal with, but if you have title insurance, then you keep a bad situation from becoming a worst case scenario.

Stephen CollinsYou Might Still Lose
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Real Estate Gifting

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If you’re giving real estate as a lasting present of value, may I suggest a title insurance policy as a housewarming present?

Most people get real estate through purchase or inheritance. Gifting is a more rare form of land acquisition but is no less at risk to ownership challenges. You may think that because you’ve owned the property for a long time there are no title problems. That’s where the threat of hidden risk walks in.

Title insurance is for the unforeseen challenges—for what may have happened even before you owned the property, for any mistake that might have occurred in public records, for that paternity suit you didn’t know about yet.

If you’re giving the gift of real estate, you don’t have to donate hidden risk. Buy a title insurance policy for the new owner, and you add lasting worth to a valuable gift.

If you truly believe that it is better to give than to receive—especially if we’re talking big items like land—please don’t hesitate to call me!

Stephen CollinsReal Estate Gifting
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The Shape of Hidden Risk

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If we knew what Hidden Risk looked like, we wouldn’t let him in the door. The truth is, he comes in many different forms. If you own a home, Hidden Risk to your ownership could come as an error in recording at the courthouse, he could be the scratch of forgery, the invisible color of an overlooked document on a title search or the guise of an undisclosed heir of a previous owner. Hidden Risk can wear a legitimate lawsuit, or be clothed in fraud. Regardless of appearance, if Hidden Risk shows up at your doorstep, he’s your responsibility.

Hidden Risk can be an expensive guest, especially if you have to foot the hospitality of a defense lawyer yourself. However, if you have title insurance, that policy will pay for all your legal expenses related to the threat of Hidden Risk.

You can’t prevent Hidden Risk from walking up to your door, but with title insurance you can keep him from entering your finances.

Stephen CollinsThe Shape of Hidden Risk
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What Experience Has Taught Me

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I’ve called St. Augustine and Palatka home since 1979. From my early years in high school, I worked in my father’s title company, Collins Title & Abstract Co., Inc. In 1987, I graduated from St. Augustine High. I went to college, got married, and returned to work with my father. In 1997, I started Land Title of America, Inc., and have been at it ever since, carrying my foundation of family values and solid business practices forward to meet the challenges of today’s real estate market.

I have seen lots of crazy things in the real estate industry over the years, and my experience has taught me the inherent risks of owning real estate. I’ve been around long enough to see the loss from unnecessary risk and how awful that is, like where spending a few hundred dollars on a survey would have saved thousands in a lawsuit. I’ve seen firsthand the need for title insurance, like when title does not get recorded properly. I don’t say what I say because someone told me to—I didn’t hear it at a seminar—I say what I say because I’ve seen it firsthand. And I’ve seen what happens to the people who take a risk without precaution.

I’m glad to do what I do, because title insurance protects people from risk. The threat to real estate ownership can be financially devastating for those who are uninsured.

Stephen CollinsWhat Experience Has Taught Me
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Insure Yourself, It’s Cheaper Than You Think

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Some people have plenty of money, are self-insured—I’m not worried about them because they can afford to take the risk. For the rest of us though, a little bit of money spent on title insurance can go a long way.

Title Insurance fees are regulated by the State of Florida. The base rate is $5.75 per thousand up to $100,000 and $5.00 per thousand thereafter up to $1 million. The bottom line is that it’s a one-time fee at closing that protects you for as long as you or your heirs have an interest in the property. It pays valid claims and covers the cost of a legal defense of your ownership. And it’s a lot cheaper than paying for an attorney yourself.

Don’t know if you’ve had to hire a lawyer lately, but it’s dang expensive! Not every homeowner is going to come up against a question of their home ownership, but it’s a big risk if you don’t have title insurance.

For a little bit of money up front, never to bill you again, you can buy an owner’s title insurance policy that insures you into the future for the faults of the past, even protecting you after you sell that property through all past hidden claims. You have that fee, versus the risk of financially defending yourself on your own.

Insure yourself, it’s cheaper than you think when compared to the risk.

Stephen CollinsInsure Yourself, It’s Cheaper Than You Think
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True or False: Does Title Insurance Never Have to Pay?

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True or False: Is Title Insurance one of the kinds of insurances that never has to pay?

The answer is False

The job of a title insurance company is to look at the property, deal with title problems, and assess the risk. They try to minimize that risk with a thorough title search, a search of public records, looking for anyone else who might have ownership rights or interest in the property.

I have a story for every question. I’ve been in the business long enough that I can give you an example for every situation, often more than one, but I’ll limit myself to one here.

There was a lady who wanted a trust created, but she was mad at her family and wanted to give her house to the guy who had been so nice and had taken such good care of her. When she died, he got the house, and sure enough, her kids challenged his ownership. They sued him for what they felt was their rightful inheritance.

Even though the guy had gotten the house free and clear, he did not have the money to defend himself in a court of law against their claim. Fortunately he had gotten a title insurance policy on the house, and that policy paid his court cost. Completely.

Yes the title insurance company did pay out on the policy. It happens more often than you think.

Stephen CollinsTrue or False: Does Title Insurance Never Have to Pay?
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Parable of the Lost Title

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There was a man who had two sons, and the younger son said to the father, “Father, give me my share of property that falls to me,” and so the father divided his wealth between his two sons, including the title to his land. The younger son then gathered all that he had and took off to a far away country where he squandered his wealth.

When the younger son had spent everything, he found himself among the swine, wishing he could partake of their food, but no one would give him anything. Finally he said to himself, “How many of my father’s servants have bread enough, and yet I perish with hunger! I will go to my father and I will say to him, ‘Father, I am no longer worthy to be called your son; treat me as one of your hired servants.’”

And so the younger of the two sons arose and returned to the land of his father. But while he was yet at a great distance, his father passed away. The older brother, not being able to locate his younger brother, sold the entirety of the property. So when the younger brother arrived—possibly expecting a ring on his finger and a fatted calf for lunch—he found instead a new homeowner on what was once his father’s land, a portion of which he was to inherit.

This kind of thing can happen. Despite that the new homeowner didn’t know anything about the younger son, this kid could claim a right to the land. If the new homeowner didn’t buy title insurance, then he’s going to have to pay for that legal battle himself to defend his ownership. Title insurance covers the legal cost from unseen risk of previous ownership.

Stephen CollinsParable of the Lost Title
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