Title Insurance:

Why is Title Insurance Important in Colorado Real Estate?
 
          When you buy or sell real estate in Colorado, you will find that a title insurance company plays a significant role in completion of your transaction. 

          The title company researches prior ownerships and debt on properties to determine what is required to transfer “clear” title to real estate.   A purchaser should review the title insurance commitment carefully to learn what documentation will be necessary to complete closing AND to learn what matters will affect the title after the purchase.  The title policy issued after closing protects against future losses arising from events that happened in the past.  Your Realtor will help you with the process, or you should consult an attorney if you have questions.

          Most title companies also have an escrow or closing department to assist  Real Estate Brokers and lenders in preparation of purchase and sale documents.    A title company escrow officer  (closer) reviews the title commitment to know what requirements must be met in order to close, and will complete the settlement numbers for the sale and loan transaction.  The escrow department is the neutral third party that handles settlement (the closing) and disburses funds for and to buyers, sellers and lenders.  

          The Division of Insurance (a State of Colorado regulatory agency) regulates title insurance companies in Colorado.   All title companies publish fee schedules to disclose the cost of title premiums and other related services.  There is no annual premium for title insurance – your owner’s title policy is good forever, even if you sell the property!



Here are some frequently asked questions about title insurance:
 

Q	What is title insurance?
A	Title insurance is the application of principles of insurance to risks which are present in all real estate transactions.
Q	What are some of those risks?
A	There are two main categories: hidden hazards which aren’t disclosed by the public record, and human errors, which will always be with us.
Q	What are some examples?
A	Forgery, incompetency of grantor or mortgagor, unknown heirs, fraud, impersonation, etc.
Q	Who pays for title insurance?
A	The owner’s policy is customarily provided by the seller.  Title insurance for a lender is usually paid by the borrower (buyer).