What is Title Insurance? Do I need it on Maui?

As a real estate professional, I often get asked about title insurance and why it's necessary. Simply put, title insurance is a type of insurance that protects against any issues with the ownership of a property.

When you buy a property, you're essentially buying the title to the property, which is the legal right to own and use the property. However, there can be issues with the title that may arise after you've purchased the property. These issues can include:

• Liens on the property
• Claims by previous owners or heirs
• Undisclosed easements
• Forgery or fraud in the title documents
• Incorrectly recorded legal documents

Title insurance is designed to protect against these types of issues. It is a one-time premium that is paid at closing, and it provides coverage for as long as you own the property. If any issues with the title arise, the title insurance company will step in and handle the legal defense of the title, including paying any legal fees or damages that may result.

There are two types of title insurance: lender's title insurance and owner's title insurance. Lender's title insurance is required by most lenders and protects the lender's interest in the property. Owner's title insurance is optional but highly recommended, as it protects the owner's investment in the property.

While title insurance is not required by law, it is essential for any real estate transaction. Without it, you could be taking a significant risk by purchasing a property with unknown title issues. The cost of title insurance is typically a small percentage of the total purchase price of the property, making it a relatively small expense compared to the potential costs of title issues.

When you work with a reputable title insurance company, they will conduct a thorough search of public records to ensure that there are no issues with the title.

In conclusion, title insurance is a crucial aspect of any real estate transaction, protecting buyers and lenders from issues with the ownership of a property. As a real estate professional with 18 years in the title insurance industry, I highly recommend that all buyers consider purchasing owner's title insurance to protect their investment in the property. If you have any questions about title insurance or any other aspect of the real estate transaction, feel free to contact me for assistance.

Gray Marino

808-745-7445

Gray@GrayMarino.com

RS-86136 REAL Brokerage, LLC