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In a western
state, an innocent buyer purchased an
attractive home site through a realty
company, accepting a notarized Deed from
the seller. Then another couple, the trio
owners of the property - who lived in
another state - suddenly appeared and
initiated legal action to prove their
ownership interest in the real estate
and that they rightfully owned the site.
Under the Owner's Title Insurance Policy
of the innocent buyer, the title company
provided a money settlement to protect
against financial loss of the buyer. As
it turned out, the forger spent time in
advance at the local Court House, searching
the public records to locate properties
with Out of Town owners who had been in
possession for an extended period of time.
The individual involved then forged and
recorded a Deed to a fictitious person
and assumed the identity of that person
before listing the property for sale to
an innocent purchaser, handling moot contracts
through an answering service. Additionally,
the identity of the Notary appearing on
the Deed was fictitious as well.
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Fraud and forgery are examples of hidden
title hazards that can remain UNDETECTED
until after a closing or settlement, despite
the most careful precautions. Although emphasizing
risk elimination, an Owner's Title Insurance
Policy protects financially through negotiation
by the Insurer with Third parties and payment
for defending against an attack on the title
and payment of valid claims.
If the innocent buyer in this case did NOT
have Owner's Title Policy, he or she would
not be protected and would have to spend
money on legal counsel and time going to
courts and hearings. Those people involved
in real estate fraud and forgery can be
clever and persistent. |
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After purchasing a
residence, the new owner was startled when
a Brother of the Seller claimed an ownership
interest and sought a substantial amount
of money as his share. It seemed that their
late Mother had given the house to the son
making the challenge, who placed the Deed
in his drawer WITHOUT recording it at the
Court House. Some 20 YEARS later, after
the death of the Mother, the Deed was discovered
and then filed. Permission was granted in
probate court to remove the property from
the late Mother's Estate, and the Brother
to whom the residence initially was given
SOLD the house.
The other Brother appealed the probate court
decision, claiming their Mother really did
NOT intend to give the house to his sibling.
Ultimately, the appeal was upheld and the
new owner faced a significant financial
loss. Since the new owner had purchased
Owner's Title Insurance upon purchasing
the real estate, the Title Company PAID
the claim, along with an additional amount
in legal fees incurred during the defense.
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Conflicts over a will from a deceased former
owner may suggest a study topic for law
school, but the subject can take on a reality
dimension and all too quickly your home
ownership is at stake. |
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Soon after a sale,
a man appeared - claiming he was the son
of the late owner by a FORMER marriage.
As it turned out, he INDEED was the son
of the deceased man. This legal heir disapproved
of his father's remarriage and had vanished
when the wedding took place. Nonetheless,
the son was entitled to a share of the value
of the home, which meant an expensive problem
for the unwary couple purchasing the property.
Although the absence of a will hindered
discovery of the missing heir in a title
search of the public records, ALTA said
that the Owner's Title Insurance issued
at the time of the real estate transaction
would have financially protected the couple
from the claim by the missing heir.
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When you buy a home, it's important to remember
what you don't know can cost you.
For a one time charge at closing, Owner's
Title Insurance will safeguard against problems
including those even an exhaustive search
will NOT reveal.
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