TITLE INSURANCE

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Title insurance isn’t a legal requirement to a commercial or residential real estate purchase. Given the ramifications of a clerical discrepancy, it is well-worth the investment.

By the Law Society of Upper Canada’s standards, lawyers are obligated to explain to clients methods other than title insurance that protect against defects in the title that slip through closing reviews. However, purchasing title insurance through a real estate lawyer has become increasingly cost effective.

A policy’s one-time fee covers a broad spectrum of contingencies:

  • Undetected title defects that prevent clear property ownership
  • Existing property liens
  • Unpaid utility, mortgage, property tax or condominium fee debts against the property
  • Encroachment issues
  • Title fraud

Survey errors and other public-records discrepancies that could make future sale, mortgaging or leasing of the property difficult

What’s more, the title insurance holds as long as you own the property up to the set maximum coverage and covers most legal expenses incurred when restoring the property’s title.
Unfortunately, it doesn’t cover:

  • Known title defects revealed before purchase, including environmental hazards
  • Native land claims
  • Problems discovered only by a new survey or inspection
  • Matters not listed in public records, such as unrecorded liens and encroachments
  • Zoning bylaw violations resulting from property changes, renovations and additions on land designated as your responsibility for creating

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