If you’ve bought a new home in the Knoxville, Oak Ridge, or Farragut Tennessee area recently you’ve learned about the various kinds of insurance you were required to buy.

The most common is homeowner’s insurance which protects the physical building and protects you from potential liability.

If you borrowed more than 80% of the purchase price for your new Knoxville home, your lender probably required you to buy private mortgage insurance to protect them in case you default.

And a third kind of insurance was lender’s title insurance to protect the lender in case of a title defect of some sort.

In Tennessee you were also likely offered the option to purchase an owner’s title insurance policy for yourself. Most buyers don’t realize that a lender’s title policy only covers the lender for the face amount of your mortgage; as your mortgage is paid down the coverage decreases as well.

An owner’s title policy protects your interest or equity in the property up to the amount of the purchase price.

When I’m representing you as the buyer of a new home in the greater Knoxville area I explain the benefits to you in buying this owner’s title policy.

Since it is co-issued with the lender’s policy you get the benefit of ‘piggy backing’ onto the lender’s policy and are typically able to buy this protection for only a few hundred dollars.

Here are some of the risks new homeowners could face that an owner’s title insurance policy will protect you against.

  • Forgery and impersonation;
  • Lack of competency, capacity or legal authority of a party;
  • Deed not joined in by a necessary party (co-owner, heir, spouse, corporate officer, or business partner);
  • Undisclosed (but recorded) prior mortgage or lien;
  • Undisclosed (but recorded) easement or use restriction;
  • Erroneous or inadequate legal descriptions;
  • Lack of a right of access; and
  • Deed not properly recorded.

If you still have questions about how you can best protect your new Knoxville, Oak Ridge, or Farragut home purchase please give me a call or email.

If you need to find a house I highly recommend a visit to www.KnoxvilleMLS.com to find the home of your dreams.