When you close on your property, your agent will go over a long list of line items on your closing documents. When you see the charge for title insurance, we want you to know the tremendous value both you – and the nation – are getting for your money. Title insurance not only protects you, the buyer, and your lender, but it is also the backbone of the American economy.
The American Land Title System is the greatest facilitator of individual wealth generation the world has ever known.
By assuring legal ownership, title insurance helps people realize the American dream of accumulating wealth in property by building equity. As they build equity, they often have the option to use it as collateral to borrow funds, which they use to improve their property or open businesses, continue their education, invest and provide for their families. The protection also lowers risk for lenders, and because title insurance protects them too, they can loan money at a lower cost than otherwise would be possible. This protection of you and your lender, in turn, drives the nation’s economy. It may sound simple, but it’s actually quite a unique and powerful thing. In almost every other part of the world, the ability to purchase property has significant barriers preventing average citizens from buying and selling property with ease. Over the last 100 years, our system has allowed countless immigrants, some who came here with nothing but the clothes on their backs, to become citizens and to save, purchase, prove ownership and build wealth for their families.
Title insurance protects the American dream of homeownership.
The land title industry helps protect people’s investments in their homes. For a one-time fee, we assure people of the legal right to their home for as long as they own their property. Title insurance agents discover and cure errors in one out of every three real estate transactions before buyers even get to the closing table, minimizing challenges after you own your property. By working to eliminate the risks that could jeopardize the right of ownership, we help protect your American dream.
Our system pays for itself in the timeliness of transactions alone.
The land title system in the United States is the most efficient real property transfer system in the world, with an average length of 30days from contract to closing. Time is money – buyers, sellers and lenders don’t have acces to their money when it’s tied up waiting for a transaction to close. Our system takes a fraction of the time required compared to the rest of the world, where it can take months to years to clear title to property! In fact, economists estimate that if the average transaction in the USA closed in 45 days instead of 30 days, the cost to the buyers, sellers and lenders would be $15 billion annually – far in excess of the industry’s total annual revenue of about $10 billion. From this perspective, the industry is essentially self funding in that it saves more money for buyers, sellers and lenders than it charges in premiums!
Title insurance provides a public service at little or no cost.
Beyond the efficiency of our system, our industry also helps others in society when:
- We collect more than $1.3 billion of delinquent federal taxes annually.
- We collect more than $3.0 billion in delinquent real estate taxes annually.
- We collect more than $325 million in past due child support annually.
- We help many victims of mortgage fraud keep their homes.
- We cover a property owner’s cost of defending themselves against challenges to their legal title to property.
- We allow for the existence of a secondary mortgage market and very competitive market rates by protecting lenders’ access to their collateral.
The land title industry reduces the cost of home loans.
The work we do protects the rights, and therefore the monetary investments, of real estate buyers and lenders. We reduce risks to lenders, giving banks the confidence to issue mortgages and home equity loans at far lower prices than they would otherwise be able to do. We provide the assurance necessary for citizens to engage in the free exchange of property! We help capitalism work!
Title insurance is quite different from other types of insurance coverage.
First, people pay for their owner’s policy only once (rather than an annual premium) to give them protection for as long as they own their property. We are the only line of insurance that insures against past issues. Second, our process works to eliminate risk upfront, rather than waiting for issues to arise later. Other forms of insurance, such as property and casualty, require little upfront work because claims can’t be predicted or prevented on possible future events.
It's a service that no one else offers.
No other industry insures people’s legal ownership of real property.
Not the government.
Title professionals use extraordinary skill to search public records and title plants for judgments, liens and other potential problems – information used to resolve issues, reduce people’s risk and conduct the transaction. Without the work we do, homeowners’ property rights could be jeopardized, and collateral and equity could be lost, along with trust in our national system of private property ownership – lending against real property would be much more limited, more expensive and far more challenging to accomplish. Long live the American dream!