Should I Get Title Insurance for New Construction?

Apr 25, 2022

Should I Get Title Insurance For New Construction?

Your New Home — Your Largest Investment

Congratulations! You’re building your dream home. In the construction process, attention to every detail is important. You’ve chosen the perfect fixtures, finishes, materials, and colors to make your house a home for years, but what about protecting your home (and investment) from things that have happened in the past? Liens, property boundary disputes, and more can all affect your home’s financial security and your pocketbook. That’s why a title insurance policy is an important part of any home purchase. 

Liens, Title Insurance, and Your New Home

New homes bring with them certain liabilities that existing homes do not. If a home has passed through several hands and multiple transactions, each time it has passed through title discovery, making new surprises a little harder to come by. With new homes, there aren’t the same opportunities for multiple title discoveries from multiple purchases. 

Liens can be placed on the land if a previous owner has failed to pay debts. This can include credit card debt, tax debt, and debt for failed property payments, to name a few. If this is the case and you purchase the land without proper searching, you could be forced to pay off those debts. 

Another common item that occurs with new construction homes is mechanics’ liens. These may be placed on the property to collect payment for a contractor’s services even if the person who originally booked the services refuses to pay. 

With title insurance, a thorough search is completed to identify these problems before you make your purchase. If liens are filed and discovered later, you could be responsible for paying off these debts. Title insurance can help pay these costs and legal fees that you may incur. 

Property Boundaries, Title Insurance, and Your New Home

During the process of building, you’ll want to get a land survey completed. This will identify the legal boundaries and lines of your property. You don’t want to rely on older surveys, as they may not be entirely accurate. This could result in unclear or incorrect property boundaries. You want to ensure you’re receiving all the land you’re purchasing and that any nosy neighbors aren’t encroaching on land they do not own. 

The title company can help resolve any disputes and discrepancies with property boundaries. They can also help identify easements, which tell you who can use the land and for what purpose. A comprehensive title policy will fully protect your home- your largest investment. 

Boundary Title — Here for Your New and Existing Construction Title Needs

Whether you are looking to protect your existing Huntsville home or a home you will live in one day in, Boundary Title is here to help. Our talented team has years of experience and brings dedication and expertise to every transaction. If you are needing to order a title for a home purchase, refinance or commercial real estate transaction, give us a call today at (256) 291-9720 or start the process online today. 

This material is provided as a courtesy and for educational purposes only. Please consult your title professional for specific information regarding your situation.

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