Homeowner's Insurance and Title Insurance - What's the difference?

Homebuyers should know the difference between homeowner's insurance and title insurance

While many homebuyers do their research before diving into the homebuying process, it can still be a very confusing experience due to the sheer amount of information involved. The homebuying process, coupled with today’s competitive market, can pressure homebuyers to speed through parts of the journey without a deep understanding of what they need, or in some cases, don’t need.

Title industry experts have found that only 1 in 5 homebuyers understand the documents presented to them during the closing process. Many homebuyers don’t fully understand what title insurance is and why it’s so critical to protecting their property rights. Part of the part of the problem is that title insurance is easy to confuse with homeowners’ insurance. 

In the simplest terms, title insurance protects your property rights. It is a unique form of insurance that, per the American Land Title Association emphasizes risk prevention than risk assumption. While a homeowners’ insurance policy protects the physical and tangible assets of a home, a title insurance policy protects new homeowners from any past issues affecting their right to own and use the property.

Homeowners' insurance protects a person from unforeseen issues related to their property. Just like other forms of insurance, homeowner’s insurance can be customized and enhanced, so it’s crucial to fully understand what type of policy will best suit your needs. It’s really a packaged policy that encompasses multiple areas related to your home.

Title insurance is a one-time premium for coverage that lasts as long as you own your home.  It doesn't go up after you purchase your  home.  Homeowners' insurance requires the payment of an annual premium which may increase from year to year.

If you would  like to know about title insurance, let us know!

 

We are the New Jersey title insurance agent that does it all for you. For your next commercial real estate transaction, house purchase, mortgage refinance, reverse mortgage, or home equity loan, contact us, Vested Land Services LLC. We can help!

For your real estate purchase or mortgage refinance or

if you have questions about what you see here, contact

Stephen M. Flatow, Esq.

Vested Land Services LLC

165 Passaic Avenue, Suite 101

Fairfield, NJ 07004

Tel 973-808-6130 - Fax 973-227-0645

E-mail sflatow@vested.com

@vestedland

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Powers of Attorney - What does it mean?

Powers of Attorney 

A question asked on NJMoneyHelp.com

I’m named as a power of attorney [actually, you are named as agent or attorney-in-fact, ed.]. What does it mean?

Q. A person has named someone to be their agent in financial matters in case of a possible need in the future via a durable power of attorney. What does the agent do once there is a need for help or to act on behalf of the person because of cognitive decline and inadequate communication skills? What does the agent have to do to help or represent the person needing assistance or representation in their financial matters?
— Getting ready

A. We’re glad you’re asking.

It’s important to be prepared to act in this very important function.

A power of attorney is a written instrument by which an individual — the principal — authorizes one or more other individuals to perform the acts specified in the power of attorney for the benefit of the principal, said Catherine Romania, an estate planning attorney with Witman Stadtmauer in Florham Park.

The named person is known as the agent or attorney-in-fact.

Acting as an agent under a durable power of attorney is a significant responsibility, Romania said.

“As an agent, you exercise your powers on behalf of the principal by presenting the power of attorney to the financial institution or other third party,” she said. “In most instances, a financial institution will insist on a review by its legal department before you are permitted to act and this will take time; therefore, when possible, it is recommended for the principal to have the power of attorney approved by the financial institution before it is needed.”

When acting as an agent, it is important to execute documents and/or make any representations solely as the agent of the principal and not in your individual capacity, Romania said.

For example, you would sign a document with your name followed by “attorney-in-fact for [name of principal].”

Records should be kept of all transactions as you may need to account at a later date for any monies utilized, Romania said.

Your authority as agent under a power of attorney terminates upon the death of the principal, she said.

If you have any questions about using a power of attorney in a real estate transaction, we'll be glad to answer.  Our website has a form.

We are the New Jersey title insurance agent that does it all for you. For your next commercial real estate transaction, house purchase, mortgage refinance, reverse mortgage, or home equity loan, contact us, Vested Land Services LLC. We can help!

For your real estate purchase or mortgage refinance or

if you have questions about what you see here, contact

Stephen M. Flatow, Esq.

Vested Land Services LLC

165 Passaic Avenue, Suite 101

Fairfield, NJ 07004

Tel 973-808-6130 - Fax 973-227-0645

E-mail sflatow@vested.com

@vestedland

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