Title Endorsements and Title Objections: What to Know when Purchasing Real Estate

Endorsements

A title confirms that you legally own property and gives you the right to sell that property. When a person purchases a home, ownership transfers to that person by way of deed, giving them the legal right to own and sell the home. However, issues could arise around the ownership interest and to help protect homeowner and lender investment, it is encouraged that title insurance be purchased. Taking protection a step further, title endorsement provides coverage beyond a home buyer’s standard title. Selecting the right endorsement could prevent costly expenses or losing your home.

Title endorsements add additional protection by adding property-specific coverage or modifying exceptions to the current policy. Typically, a title endorsement will cost up to $75 depending on the underwriter of the policy and the state in which the sale is being performed. There are around 100 different types of real estate title endorsements allowing for a custom fit for your property and situation. A few common title endorsements include Easements and Encroachments; Minerals and Subsurface Substances; Survey Coverage; Access and Entry; Zoning; and Contiguity. Title endorsements are not a necessity for each real estate transaction, but in certain situations where you or your attorney may believe there to be a specific issue with your title, you can purchase a title endorsement to protect against that issue.

Objections

A title objection letter is used by a prospective real estate purchaser to comment on or raise any concerns regarding the title report or commitment issued by the title company. The seller is notified of the buyer’s request for resolution or correction to specific title issues before closing. For example, a buyer typically wants proof of a seller’s existing loan being paid off prior to taking ownership of the property. Other common objections include: old restrictions or zoning which is not enforced. Once the title report or commitment is sent to all parties, the buyer should confirm the exact date objections to the title are due and should approve or object within that contractual deadline. It is important to note that if the title objections are warranted, the buyer must identify those objections in writing by the deadline to make a proper objection and if the buyer fails to do so, then the buyer waives their right to object to adverse title issues and the purchase of the property must be completed.

If you have questions about purchasing real estate and what you should be on the lookout for, contact on of our Real Estate Attorneys at McNeelyLaw LLP by calling (317)825-5110.

This McNeelyLaw LLP publication should not be construed as legal advice or legal opinion of any specific facts or circumstances. The contents are intended for general informational purposes only, and you are urged to consult your own lawyer on any specific legal questions you may have concerning your situation.