Unless you are a real estate investor or possess a healthy amount of knowledge about property law, chances are you’ve thought of title insurance only in the context of the huge stack of legal documents you have to sign when you close on the purchase of a new home. Face it – at the climactic moment of finalizing a property transaction, most of us are eager to sign and take possession of the keys, and relatively little thought is given to the details behind all those closing costs.

A Tampa CPA from Reliance Consulting, LLC, can answer your financial questions as you prepare to make a big purchase, like a house or commercial property. Part of the responsibility of homeownership is understanding where your money goes, and why. That includes title insurance, which is a vital but little-understood facet of the home-buying process.

In essence, title insurance protects the lender and the buyer from potential legal entanglements associated with the property’s previous owners. Unlike other insurance policies, there is no monthly or annual premium – it is paid for once and remains in effect throughout the term of ownership. The title company that issues the policy will perform a title search of legal documents to make sure, among other things, that the seller has the right to sell the property. Other legal issues a title search seeks to uncover include:

• Outstanding liens against the property
• Unpaid property taxes
• Ongoing ownership disputes
• Buyer or seller fraud, such as forged signatures on property documents
• Other property encumbrances or restrictions

Before you make a major property purchase, contact a certified public accountant from Reliance Consulting for a financial health checkup to make sure there are no unwelcome surprises.