Lending services provided by Reali Loans, Inc., a wholly-owned subsidiary of Reali, Inc. Because of this relationship, use of Reali Loans, Inc.’s services may provide Reali, Inc. a financial or other benefit. However, this type of deed does not promise clear title; it only guarantees the title for the period during which the grantor owned it. Section 8 of the federal Real Estate Settlement Procedures Act prohibits the giving or accepting of kickbacks and referral fees among persons involved in the real estate settlement process. If something happens to affect the title, it could impact your ownership and make it difficult to sell when you are ready to move.
In some states, the seller pays for the owner’s title insurance policy as a seller closing cost. In other states, the buyer pays for the owner’s title insurance policy as a buyer closing cost. Ask your real estate broker or mortgage broker for the names of a few title insurance companies or agents they have worked with in the past, not just one. While real estate brokers are required to provide the names of three title entities, they may refer you to an entity they have worked with extensively. This does not necessarily mean their services will be the best for your particular transaction.
What would happen if there was an issue with your title and someone else tried to claim it as their own? A special warranty deed is a particular kind of deed for real estate that make guarantees about the title only during a certain period of time. Special warranty deeds can leave a buyer open to other, older title claims. It’s always important to communicate with your title company about these potential issues and to make sure you fully understand what is and is not covered under your policy. As a new homeowner, being protected is likely your number one priority. Spending time to make sure you have the right protection for your home, your title and your family is crucial to a stress-free mortgage.
Which Title Insurance Policy Should I Choose?
Extended policies theoretically cover you against a number of things, but they usually come with exclusions. When you get a title policy, the title insurer researches the title, identifies existing issues and excludes them. On a clean property, the title insurer will exclude predictable items such as the county’s authority to levy property taxes or utility easements that let the gas man check the meter. While these exclusions from coverage are standard, others can be more serious, and you might want to work with your real estate agent, title officer or attorney to cure them before you close on the property.
With Commonwealth Land Title, homeowners can enjoy peace of mind knowing they are insured by one of the industry’s premier title insurers. And with the Owner’s Policy, they’ll enjoy even more peace of mind knowing they have the best title policy available. These things would place your ownership interest in the property in jeopardy if they were not discovered prior to you purchasing the home.
Owner’s Title Insurance protects you against any losses incurred due to any defects in the title that existed prior to you purchasing the home. Any liens or judgements you incur after purchasing the home are not covered by title insurance. Sometimes, it’s called an enhanced owner’s title insurance policy.
In other words mortgage fraud areas, but there are other areas lenders care about such as property flips. Property flips involve investors who purchase a home, usually renovate it, and then sell for a higher price. FHA loans have a rule in place preventing a loan within title insurance endorsement 90 days of the seller’s date of ownership. The risk in doing so is that you’ll have a gap in coverage when buying a policy after the closing. Bear in mind that if anything happens between the closing and the activation of the policy, you will not be covered.
These outstanding balances must be paid before the transfer of ownership. Some states demand more thorough research from the title insurance company, which makes the policy more expensive. And if a government body or individual files a claim against your property, you’ll be glad that you invested in an owner’s title policy. If you want to learn more about title insurance and the basics of owning a home, speak with a Home Loan Expert.
We recommend the purchase of the title insurance for some very simple reasons. Although a title insurance company will most likely be provided for you during the mortgage transaction process, be aware that you are not obligated to use the suggested title company. Yes, your title company does an exhaustive search of all of the past owners of the property and does their best to make sure any title issues were cleared up and handled. During the closing process, they’ll issue an Abstract of Title Search to show that the title is not clouded and is clear to be transferred. Even if you have the best company doing the research, it’s not foolproof and that’s where your policy comes in. These generally aren’t required for a sale to go through because the seller or the lender wouldn’t be affected if you end up responsible for title issues on your property.
;important Title Insurance Questions And Answers You Should Know
Keep a hard copy of your title policy and closing protection letter in a safe place. If the former owner bought the property within the last 10 years, they probably have a policy. how important is title insurance Track that down and save 20-30% on the Owner’s portion of the Title insurance. If lost, the former closing company can send a fax for $25 to prove the insurance was purchased.
With title insurance, you pay a one-time premium, usually at closing, and are covered for as long as you own the property. Title insurance is an indemnity contract between you and a title insurer for past defects in a chain of title. More simply, title insurance is an agreement that should a problem arise in the ownership records of your property, your insurer will fix the problem, defend you against it, or compensate you for any losses. Imagine you’ve spent tens of thousands of dollars in down payment, closing costs, and a few years of mortgage payments. Now, an heir to a former owner is suing to obtain the home, arguing that it never should have been sold to you in the first place. However, real estate transactions involve large sums of money, and your mortgage payment is likely to be your biggest recurring expense.
Lender’s Policy – Insures the lender against any title issues that would affect the lender’s collateral in the property. As discussed below, sometimes title insurance requirements are more important than legal requirements. Title officers and escrow officers are a good source of information.
While a buyer is able to assume a mortgage, meaning the buyer agrees to purchase the property and pay off that mortgage, this buyer is not required to do so. If the title is defective, the seller of the property may be required to clear title, or to remedy the title defects, prior to the seller completing the sale of the property to a buyer. No title insurance corporation or any other person acting for or on behalf of it, shall make any rebate of any portion of the fee, premium or charge made, or pay or give to any applicant for insurance . Either directly or indirectly, any commission, any part of its fees or charges, or any other consideration or valuable thing, as an inducement for, or as compensation for, any title insurance business.
Most title insurance costs arise in preventing loss rather than paying claims, and prevention costs are not much different for a small policy than for a large one. Despite this, premiums are scaled to the amount of the mortgage or the value of the property, which suggests that smaller policies may be under-priced and larger policies overpriced. •Exclusions – One of the most important parts of the insurance policy and if needed, have it clarified by your insurance agent. This is the part of the policy that states what is not covered, instances or situations where you will have reduced claim or no claim at all. Exclusions pave the way for the risks that are out of bounding by what the insurance company is willing to cover. Provisions for exclusion should be crystal clear to both buyer and seller or any policyholder before entering into a contract.
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Your insurer might pay off the amount you owe or might negotiate with the lender filing the claim so that you can keep your home without having to pay off the debt owed by its former owners. Some of the bigger fees you’ll pay when closing a mortgage are related to title insurance, including the insurance itself and a search that your title insurance company runs to make sure no one else has a claim to your property. The lender’s title insurance policy is meant to protect them from any issues that would arise with the title after closing. Pretty much all lenders require title insurance as part of the closing costs.
These fees are usually not regulated and in those cases may sometimes be negotiated. In some states, regulation requires that the title insurer base its policy on the opinion of an attorney. They are also not part of the title insurance premium, though the title insurer may include those fees within its invoice as a convenience to the attorney rendering the opinion. Similarly, fees for closing a sale or mortgage transaction are not regulated in most states though the charge for closing may appear in the invoice disclosing the total charges for the transaction. Title insurers conduct a title search on public records before they agree to insure the purchaser or mortgagee of land. Specifically, after a real estate sales contract has been executed and escrow opened, a title professional will search the public records to look for any problems with the home’s title.
What Should I Do If Anyone Makes A Claim Against My Real Property?
Thus, the reissue rate is really a discount on standard premiums and is usually available for refinanced home loans, as well as on the resale of the house. A lien or claim that may not have been recorded, from a contractor who made improvements on the property. This blog is made available by Mazurek, Belden & Burke, PC, for educational purposes only, and not to provide specific legal advice. This blog does not create an attorney client relationship between you and Mazurek, Belden & Burke, PC. This blog should not be used or considered as a substitute for competent legal advice from a licensed attorney in your state.
The seller also warrants that he/she has the authority to transfer title. In Florida, generally, the seller buys insurance to protect against any outside claims. Zawadzki says that even though a tax search might come up with no delinquent taxes on a property, that doesn’t mean a buyer couldn’t subsequently receive notification of delinquent back taxes after closing. And that bill could be heavy—unless the buyer has owner’s title insurance. You can buy a residential title insurance policy at any time while you own a property.
Hazard insurance, otherwise known as homeowners insurance, is most popular. If in a flood hazard area, then lenders will require flood insurance. Even if the property is on the coast, then wind & hail insurance may be necessary, but did you know that there are circumstances that could threaten the property’s ownership or mortgage position? The most simple definition is that this ensures the title search performed on the property. A federal law called the Real Estate Settlement Procedures Act entitles an individual homeowner to choose a title insurance company when purchasing or refinancing residential property.
It is not clear to the buyer that this is optional and that most of the profits of the closing come from this. Prior to closing, your home loan must go through an underwriting process. Underwriters are like real estate detectives – their purpose is to make sure you have represented yourself and your finances honestly, and that you haven’t made any false or inaccurate information on your loan application. Fees can be negotiable, and it’s important to keep in mind that you can shop lenders until you find one that offers you a loan with lower fees. Closing costs may vary depending on where you live, the type of property you buy, as well as the type of loan you choose.
Most states require an affidavit of title as part of the legal paperwork required for transferring property from one party to another. An affidavit of title is also generally required by the title company before it will issue title insurance. This potentially is the biggest investment you’ve made in your life, and it pays to make sure you do the correct due diligence to minimize your risk. A title policy will pay out if the home you’re buying turns out to have problems with its title.
You can also have exceptions removed for liens as long as you send evidence that the liens have been paid off. Your attorney is also a helpful individual to consult during this process. The title commitment will actually list out any potential issues, exclusion, or exceptions that appear on the title record as of the effective date of the commitment. Be sure to check for these so you can be prepared and get this handled if it may impact your property ownership.
To fully protect your interest in the property, getting title insurance is a no-brainer, especially if you have multiple real estate investments. Owner’s title insurance is sometimes bought by the seller of the home to offer the buyer some reassurance during the home buying process. However, if you’re buying a home, you may have to buy it yourself. In addition, there is another type of title insurance that you should be aware of when buying a house.
An R-8 credit in Texas is when a new lender’s title insurance policy is issued to renew, extend or satisfy an old mortgage that is already insured by a Texas lender’s title insurance policy. Generally, this credit is applicable during refinance transactions. Today, title insurance protects against errors in public records, unknown liens or easements, or missing heirs. Homebuyers can buy title insurance to protect themselves, but mostly, they’re buying title insurance to protect their mortgage lender.
Owner’s title insurance provides protection to the homeowner if someone sues and says they have a claim against the home from before the homeowner purchased it. https://t.co/HQsEpjibwW #titleinsurance #homebuying #homeownership #realestate pic.twitter.com/mNxbmR6j3l
— Cortes & Hay Title (@CHTitleAgency) May 1, 2019
The title insurance premium may increase if the amount of the loan increases. If you are financing your purchase with a mortgage loan, your lender will require you to purchase a policy for the lender . For a buyer to be protected, an “owner’s” policy is also issued at the time of closing. Purchase of owner’s coverage is optional, and is a charge separate from the lender’s premium. It is, however, discounted if purchased at the same time as the lender’s policy.
Under these systems, the government determines title ownership and encumbrances using its land registration; with only a few exceptions, the government’s determination is conclusive. Governmental errors lead to monetary compensation to the person damaged by the error but that aggrieved party usually cannot recover the property. The Torrens title system is the basis for land registration systems in several common law countries. You can expect to pay somewhere between $1,000 and $4,000 for title insurance, according to CourtHouseDirect.com, a courthouse data research website. Can you make a case against buying the owner’s title insurance policy? But let’s think this all the way through before making a decision.
So many things could happen since the prior title search which could affect a lender’s position against the deed. Title insurance protects all of the parties involved in the sale and purchase of the home. An owner’s title insurance policy insures your ownership rights to the property. The coverage will last as long as you own the home; you pay for this policy once at the time of closing. Title insurance is available in many other countries, such as Canada, Australia, the United Kingdom, Mexico, New Zealand, Japan, China, South Korea, and throughout Europe.
But if the seller doesn’t purchase title insurance to protect you, any financial liability related to title issues could be your responsibility. Owner’s title insurance usually costs about 1% of the purchase price of the property, though this can vary from state to state. For example, the owner’s title insurance for a $500,000 property in California should cost between $1,200 and $2,000. Title insurance is a unique type of insurance protects homeowners and lenders from costs relating to title claims or disputes. In Washington, as in many states, it is usually the seller who pays for the buyer’s title insurance policy. And the home buyer is typically responsible for purchasing the lender’s policy.
Someone else may have rights to a part of your property, such as a utility company, but that’s not discovered during the buying process. They could be from a homeowners association where a fine wasn’t paid, a contractor who wasn’t paid for work completed or the government if property taxes weren’t paid. LendingTree is compensated by companies on this site and this compensation may impact how and where offers appears on this site . LendingTree does not include all lenders, savings products, or loan options available in the marketplace. LendingTree is compensated by companies on this site and this compensation may impact how and where offers appear on this site .
To protect their financial interest, buyers can also choose to pay a one-time fee at closing for the owner’s title insurance. This policy protects you and your heirs and requires the title insurer to pay costs and claims associated with a qualified title issue. In the event that there is a claim against your rights of ownership in the property, your title insurance company will cover the cost and fees associated with defending against the title claim. The policy will also cover, up to the face amount, any loss of title or the cost of perfecting the title. Without title insurance, you may be faced with huge legal fees and costs and even the loss of all or a portion of your dream home. Before offering to issue a title insurance policy, a title company will do a title search to learn whether there are any problems or limitations with the title.
The choices you make around buying and financing property are some of the biggest you will make in your lifetime. It’s important that you protect your investment and give yourself peace of mind. Title insurance policies will range in price, between $500 to $3,500, depending on the value of the property, the provider, the location, and the coverage limits.
To flag any potential problems, the insurer should thoroughly research your title and provide you with a report before closing. If you don’t bother reading it, and it mentions an anomaly in the title , you’re assumed to have accepted that. And your insurer will be supremely uninterested when the other owner comes to call.
Under a standard policy, owners are protected against impersonation and forgery. It will provide protection against a deed not joined in by a necessary party, undisclosed prior liens, or undisclosed easement or use restrictions. Private mortgage insurance may be included with this option, which would provide the lender with value should the owner of a property default on their loan for some reason. Lender’s title insurance is pretty straightforward in most circumstances.
When you pay for title insurance, though, you aren’t just paying money to insure you down the road. Before you buy title insurance, a title company is working to make sure there are no issues with your title. Lender’s title insurance will most likely be a required part of the mortgage. Your lender is required to provide you with a list of companies in your area that provide closing services such as title insurance and escrow services. You’ll may deposit a down payment and pay buyer’s closing costs or charges for refinancing.
A reason to be concerned is that the insurance company may use this to deny a claim later on, as they would say the policy is invalid. The title company may advise the seller on how to solve title problems before the home is sold or fix boundary issues with a survey to confirm the property’s boundaries before it’s put on the market. The two most common types of title insurance are owner’s title and lender’s title policies. The lender, attorney or escrow officer creates a title order and reviews public records related to the home.
It is the responsibility of the buyer to pay for it, but it protects the mortgage company. If you don’t need to take out a mortgage to pay for a home, it is not needed. A few states require that lender’s pay for the policy, what is title insurance texas but the majority do not. There are many other concessions buyers can ask for in a deal — such as a reduced purchase price or a home warranty — that save even more money than having the seller pay for title insurance.
Title insurance is coverage that protects property owners and lenders from title defects and ownership issues. Like all lines of insurance, title is highly regulated by the government. In Texas, the Department of Insurance is the state agency charged with oversight of title insurance.
Did you know that there are a couple of types of title insurance options – owner's title insurance and lender's title insurance?
— Consumers First Title Company, Inc. (@Consumers1Title) July 25, 2018
If you refinance, pay off or obtain a new loan, a new policy is required. An Owner’s Title Insurance policy is purchased at the time a property is purchased and protects you, the buyer. This insurance policy remains in effect until you sell the property. If you don’t purchase owner’s title insurance and an issue turns up in the future, you’ll likely be responsible for correcting it, which can be costly.
In addition, costs can differ from title company to title company. Typically, if there is a mortgage, the lender will require the purchaser to buy a policy of title insurance covering the lender’s interest. Since the amount of the mortgage is generally less than the price of the home, the purchaser will be at risk for defects in the title to the extent that they exceed the mortgage amount. Because the loss can be greater than the mortgage itself, home buyers frequently purchase owner’s policies of title insurance in addition to purchasing lender’s policies. An owner’s title insurance policy is typically issued in the amount of the purchase price of the home. This was due to the fact that in the past title insurance companies generally did not authorize attorneys to issue policies directly and thus there was no policy presented to the lender at the closing.
The mortgage company usually arranges this and is usually provided by the settlement company. Kevin O’Flaherty is a graduate of the University of Iowa and Chicago-Kent College of Law. He has experience in litigation, estate planning, bankruptcy, real estate, and comprehensive business representation. Baseline coverage includes fraud, forgery, unknown or undisclosed heirs and spousal claims.
Fair Isaac is not a credit repair organization as defined under federal or state law, including the Credit Repair Organizations Act. Fair Isaac does not provide “credit repair” services or advice or assistance regarding “rebuilding” or “improving” your credit record, credit history or credit rating. By getting more aggressive about questioning lenders on high home purchase fees, consumers can really cut into high closing costs.
It’s important to note also that it’s possible to save money when seeking title insurance. Seeking a reissue or substitute rate from your provider can help ease some of the cost of title insurance. In any case, as noted, whether you want it or not, your lender probably will require you to have title insurance and that is a good thing, Mallett asserts. “The most important asset you have is probably going to be your home, and not to have title insurance protecting that is just a big mistake,” he says. You could try the American Land Title Association website, which has a search engine of title insurance companies.
A costlier title issue to clear would be one involving a discrepancy with land ownership. For example, a seller has co-owned her property with her brother for 25 years. She and her brother have not spoken in the last ten years and she is unaware that she needs her brother’s signature on the deed to sell the property. A title examination reveals that the buyer did not purchase the property with good, clear, marketable title as the brother still has an ownership in the property. Again, owner’s title insurance will not only protect the seller from this kind of loss but the title insurance company with also pay for the financial cost of litigating the claim of ownership to the property.
- For the real estate closing, either the parties to the transaction or their attorneys are required.
- Statewide Title operates in, and has working knowledge of, all 100 counties in North Carolina.
- This “most competent attorney,” however, can make mistakes and suffer errors of judgment and errors of omission.
- Even if the seller provides a warranty deed, a document that confirms the title is clear, this policy can help cover costs in the event of an issue.
A typical title insurance policy costs around 0.5% of the home’s purchase price. Regardless of your location, in nearly all cases extra fees can be a standard part of the transaction when you buy a title insurance policy. These add-on expenses can add up quickly, including mail and courier charges, copy fees, and costs for searches and certificates. What many buyers don’t know is that these add-ons may be negotiable, even if the insurance premiums are not. An Owner’s Title Policy provides a home buyer with assurance that their title company will stand behind them in the event that a covered title problem arises after settlement.
Title insurance is probably something you’ve never thought about until you began the process of purchasing a house. It’s actually one of the most valuable types of insurance because it protects buyers from unknown claims of ownership to their new residence. Like most forms of consumer insurance, a title insurance policy may be boring in structure and may cost you $1,000 or more to purchase the policy, but if you need it – you’ll be glad you have title insurance.
You enter into a contract to buy a home, the title search comes back clear, and then you close on the property. A few months later, someone shows up claiming to be the prior owner’s older sibling. They state that the property was left to them in a will and should never have been sold. Title insurance is a valuable form of insurance protection that protects both the homebuyer and the mortgage lender against possible financial losses attached to a new home and property. It’s also worth noting that in some states, the home seller is required to pay for title insurance, as a way of stating the home is free of defects and disputes. Once the home title has been recorded and the escrow account funds are paid out to the appropriate parties, the title insurance can then be purchased for full protection of the home before the purchase is completed.
Your lawyer/notary can arrange the purchase of a home owner’s policy. Title insurance is an insurance policy that protects you, the home owner, against challenges to the ownership of your home or from problems related to the title to your home. The policy provides coverage against losses due to title defects, even if the defects existed before you purchased your home. A title defect is a problem with the title which prevents free and clear ownership. There are many types of defects such as rights of way, encroachments , unpaid liens, etc.
There are plenty of web sites that will explain to you the many reasons behind the importance of having title insurance policies on your home. For more information, The American Land Title Association provides consumer information on their web site. Home buyers should also ask the title company to ask what the cost difference is between a buyer’s standard policy and an enhanced policy. In some jurisdictions, owners are offered a choice between standard insurance coverage and expanded coverage. It’s wise to know what is included in the type of coverage being quoted.
Sometimes, an agency will have the ability to sell insurance for more than one insurance company. While agencies file their closing and settlement services fees with the Division of Insurance, it is only the insurance companies who have the ability to set the premiums , which also must be filed with the Division. However, any insurance contracts purchased from an insurance agency will be written on a particular insurance company’s policy form (also called the “underwriter’s paper”), as it is that company who provides the actual insurance. Although claims are rare, when they happen they require extensive research and legal fees in order to protect the homeowner.
Owner’s title insurance provides protection to the homeowner if someone sues and says they have a claim against the home from before the homeowner purchased it. https://t.co/HQsEpjibwW #titleinsurance #homebuying #homeownership #realestate pic.twitter.com/mNxbmR6j3l
— Cortes & Hay Title (@CHTitleAgency) May 1, 2019
We’ve maintained this reputation for over four decades by demystifying the financial decision-making process and giving people confidence in which actions to take next. Cate Deventer is a writer, editor and insurance professional with nearly a decade of experience in the insurance industry as a licensed insurance agent. Investopedia requires writers to use primary sources to support their work.
In this situation, we would be dealing with a blanket mortgage or several different mortgages that are cross-collateralized . For example, borrower has 5 fast-food restaurants in Los Angeles, and wants to use all of these properties as collateral for a loan in the amount of $1 million. Each property is worth only $200,000, but in the aggregate, they are worth $1 million. Because it is important that title be insurable, the title insurance companies’ underwriting guidelines can be almost as important as the legal requirements of state law. If a title insurance company will not issue a policy on a specific type of deed, for example, it may not matter whether the deed is otherwise valid under state law. For example, say a lien is properly filed, but due to an error at the clerk of courts office (misfiled, etc.), it is not discovered during the title search.
The risk of a claim against your title is probably lower than a claim that would be paid by your car or home insurance. Your new lender probably trusts you, as it is willing to make you a loan. However, since you cannot categorically advise the lender that you have clear title, the lender will insist that you obtain a title insurance policy in favor of the lender. But with title insurance, the coverage is limited to risks that are already in existence at the time the policy is issued. The content on this site is not intended to provide legal, financial or real estate advice. It is for information purposes only, and any links provided are for the user’s convenience.
That means if there is an issue with the title, the lender is protected from financial loss, but without owner’s title insurance, you are not. The owner’s policy of title insurance only protects the interests of the buyer, not the seller, even if the seller paid for the premium for the policy. Under the example above, once the title insurance company has made the payment to the buyer, it is subrogated to the rights of the buyer against you , and has the right to make a claim against you to recover the payment made. Because the existence of the undiscovered recorded easement is a breach of the deed given by you to the buyer.
Title insurance protects the insured against title issues that are uncovered after closing. It’s an important part of a real estate transaction for anyone who will have a financial interest in the property after the transaction is finalized. Most home buyers are familiar with the concept of homeowners insurance. These policies cover hazards such as fires, pipes bursting, and more.
Paying cash for a home doesn’t mean you won’t have ongoing payments. You may pay owner’s title insurance at closing, but you’ll see recurring expenses long after you’ve signed on the dotted line. One of the biggest is property tax, which averages $3,296 per year nationwide, or just over $274 a month. Before you decide whether to opt out of owner’s title insurance, though, it can help to know how much you’ll be expected to spend. This can vary widely from one closing to another, but you can generally be expected to pay between $1,000 and $4,000 for your policy.
The abstractor will also look for evidence of any recorded encumbrances on real estate. If the current owner mortgaged the property or allowed some other form of lien to attach to the property, the abstractor will look for evidence that the mortgage was paid off or the lien was otherwise satisfied. This ensures that there are no liens against the property that affect property value. The lack of ability to obtain title insurance will prevent the buyer or borrower from getting full value for the property.
If they refuse, you could then file a lawsuit to get the lien removed and possibly obtain damages for slander of title. While the title and settlement process may seem less exciting than, say, picking out custom kitchen finishes or new hardwood floors, it’s a critical step in the homebuying and mortgage process. Most of the title services work will happen behind the scenes, but you can relax once your lender approves your mortgage and you know the home is rightfully yours. Technically yes, if a fraudster steals your personal information and transfers the title of your home to his name without your knowledge.
Other companies may offer larger discounts off their base premiums depending on how long it has been since a property was last sold or refinanced. A buyer would have nothing to inform buyer about any easement that impact or limits the use of the real estate. Although the house may be brand new, the land it’s sitting on is not. There could be a discrepancy in the chain of ownership dating back to the previous dwelling that would now be applied to the new home.