Title Insurance: A Necessity When Buying Land?

August 22, 2022

Title insurance comes in handy when purchasing a home, especially if the title has issues that could delay the closing or create problems after the closing. When buying land without any structures, title insurance is also a necessity. The product protects buyers from issues with any property, whether it has a building on it or not. Without title insurance, you face issues with access, zoning restrictions, and erroneous records that could jeopardize your ability to use the property as you wish.

Understand What Title Insurance Does

When you add title insurance from a reputable company like Sunnyside Title Insurance, you protect yourself from the previous owner’s mistakes. Title insurance protects you from things like judgments, forged documents, missing heirs, and boundary disputes. Without it, you are stuck managing the problems the previous owner did not fix.

Protection From Costly Expenses

If you don’t get title insurance on land, you could have costly expenses due to problems like tax liens, easements, encroachments, and encumbrances. Once you close on any property, the financial obligations are yours.

Without title insurance, the tax liens and boundary issues become your problems. These problems could prevent you from building on the land. If they require legal work, they could take years to resolve. Consider that property owners usually don’t sell unless they have a reason, and the reason could be the desire to pass expensive issues to another owner.

Title Searches Aren’t Perfect

Title searches aren’t perfect, because humans enter the information. People make spelling errors or enter incorrect numbers, so the issues relating to titles land elsewhere. Some people aren’t aware that they received property in a will, so the title never gets transferred to them. Because title searches have flaws, it’s wise to pay for title insurance on any property you purchase.

Fraud Happens More Often Than People Think

Unscrupulous people look for easy targets, and they can often be people looking for good deals on land. When you are making a large purchase for a home or property, you’ll want to protect your current and future assets. Even if an owner tells you that the title is clean, you should still get title insurance. Criminals have scammed buyers by impersonating owners and forging documents. If they’ve done it once and been successful, they’ll do it again, and you could be the victim.

Lenders Need Title Insurance

Buyers aren’t the only parties that need protection from title problems. Lenders need protection from title problems so they do not forfeit their mortgage investments. Lender title insurance is different from property owner’s title insurance.

Titles Can Have Issues Connected to Divorces and Bankruptcies

Title searches only show what clerks enter into databases. Sometimes, issues connected to divorces and bankruptcies are not entered or removed properly. In divorces, one party might think they can sell a property, but the other party could still be on the title. In a bankruptcy, a lien holder could be on a title, even if the bankruptcy has been discharged. Title searches don’t always show these issues, which is why title insurance on all properties matters.


Carlos Diaz
I believe in making the impossible possible because there’s no fun in giving up. Travel, design, fashion and current trends in the field of industrial construction are topics that I enjoy writing about.

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