“Hugeantic Repartment” is something I used to say as a kid. It means “Huge Apartment.” I’ve been spellbound most of my life (thank goodness for spell-check!) and I’m still making up words. I figure the English language is so messed up anyhow, isn’t that how most words came to be? You take Spanish, French, German and shake them up in a box and let ‘em go like Yahtzee dice—I’m just trying to do my part for the English language! Spelling and pronunciation errors are pretty easy to correct compared with real estate title problems. Title problems can hide then surface and cause financial “devastruction” (again, trying to do my part).
You can make one hundred percent on a spelling test. That means you spelled every word correctly, the grade goes on your report card and it’s not going to change. Real estate, on the other hand, can pass a title search—an inspection of public records—and still have problems.
A deed is the document that says you own your home or land. It comes in many different forms—it comes in the form of a Warranty Deed or a Quit Claim Deed—yuck—or Certificate of Title. It’s supposed to be unique—it has a legal description of the property and gets filed in public records to designate your ownership rights. Unfortunately, mistakes happen. Just like on a spelling test, you can have errors and omissions. Unlike a spelling test, those errors and omissions on a deed can fold into pockets of hidden risk, along with undisclosed heirs, a simple recording mistake, or even forgery.
A clear title search does not rule out possible ownership challenges. No problems found now doesn’t mean there won’t be a big risk later. What you can’t see can cost you unless you have title insurance.
On a spelling test, you’re liable for your own mistakes. In real estate ownership, you’re liable for everybody else’s mistakes who owned that property before you. Title insurance takes the risk of financial loss out of real estate ownership. Title insurance pays claims and litigation costs in the defense of ownership. You get an A Plus on your bank statement no matter what ownership challenges you face.