Simplicity Title Business Faith, what??? You do title insurance, what does that have to do with Faith, and what is Business Faith anyway? Faith’s definition is “complete trust or confidence in someone or something.” As a business owner, I have to constantly remind myself of Simplicity’s Business Faith. Simplicity runs with its own self-sustaining fuel; high employee morale, autonomy, pride, accomplishment, care for the product output. This fuel also produces a genuine care of one another and a faith in our company.
As the leader of Simplicity, I need to look at the big picture but also make sure everything runs smoothly on the day to day activities. Yes, we have managers to oversee that, exceptional managers at that, nevertheless there is something more than people at work here at Simplicity. We have to have faith in the overall “being” and functionality of Simplicity. With faith, we believe that everything will always work out if we always do the right thing, no matter who or what pressures us to do different. With faith, we can alleviate panic and anxiety in the work place (we will touch on that next week). We will continue to stay honest with ourselves and our customers, and ultimately have faith not only in one another, but faith in Simplicity Title as a whole. Micromanaging will crush any business. It just doesn’t work. Hiring the best in the business, letting them do their job, and creating a vision that everyone can believe in, is why Simplicity is growing so nicely. We have complete trust in the Simplicity Family and we are confident in one another that we will all play our part and continue to work hard. We trust in one another and we trust that Simplicity will continue to grow on the honorable path, and that all comes down to Simplicity’s Business Faith.
- Luke Tyler, President and CEO
Last week, we discussed the importance of the owner’s policy when purchasing a home and gave the example of the $150k home equity lien found on the property 2 years later when the couple refinanced. The lien was now the current home owner’s responsibility even though it was the seller’s Line of Credit. Key point to last week was that liens “run with the land” so once you transfer title, and a lien is attached to the property, that lien is now the current owner’s problem. Our job is to make sure you obtain title free and clear of any liens. Lastly, when you purchase, we discussed you get two policies; owner’s and lender’s policies. We discussed the owner’s, now time for the lender’s.
The second policy is a Lender’s Policy. Lenders require their borrowers to obtain title insurance so the lender knows that their mortgage is recorded in first lien position. (cough cough, line of credit example) So someone just purchased two years ago and they are refinancing, and they wonder why they need to pay for title insurance again. They are paying off the existing mortgage in full, in which there is a lender’s title policy attached to that mortgage; so the policy stays with that paid off mortgage. When refinancing, the lender will require a new policy for the new mortgage. A lot can happen in two years. Within those two years, there could have been a borrower with a $100k hospital bill that could not get paid. The hospital would then record a lien on the property as collateral. We see child support liens, defects in title from prior owners, etc. The bank needs to know that the money they are lending is secured, and they can do that by making sure their mortgage is recorded in first lien position. So yes, people who are refinancing are paying again, but they are not paying nearly as much, and remember, an owner’s policy stays with the owner as long as they own the property so only a new lender’s policy is required. If the new loan amount is less than the existing loan amount then they will get the full refinance rate which is a much lower rate than the basic rate of when they purchased.
Title insurance is so important for you, the home buyer, and once again, please remember, this is YOUR CHOICE on which title company to use. We will make sure your title is free and clear so when you purchase or refinance your property, you know your title is not only secure, but also the closing process is made simple. Learn more at Simplicity Title.
- Luke Tyler, President and CEO
It still astonishes me how many people spend thousands of dollars on title insurance when they purchase or refinance a home, but have no idea what title insurance is. So let’s give the people a comparison of what they know. When people think of insurance, they think of car insurance, health or life insurance, not title insurance. Car, life, and health are all insurances that cover a future event. People are paying multiple premiums in the event of a future car crash, death, or doctor’s visit. Please notice the words future event and paying multiple unregulated premiums. Title insurance is in a way, the opposite of these insurances. Foremost, we need to understand that there are two title insurance policies, and most importantly, it is YOUR DECISION as the buyer on which title company you want to work with. This week we will discuss the owner’s policy.
An Owner’s Title Policy insures the past history of the land and is a one-time, price regulated premium payment paid at closing. Please note the words Past, One-Time and Price Regulated. Simply stated, “title” is the right of ownership in property. When a person holds the Title to property, it simply means they have proper and legal ownership. Title insurance protects your investment by shielding you from any claims against your title in the property purchased. Title Insurance is an insurance policy guaranteeing that the title to property is clear, and that the owner has the right to sell the property. Accordingly, once a title insurance policy is issued, your interest in the property purchased is protected, subject to the exclusions and conditions contained in the policy. Should a problem later arise with the title, we will protect you in any litigation that may ensue, including paying costs, attorneys’ fees, and expenses. If the claim is ultimately proven to be valid, we will also pay the costs of your claim, up to the amount of the policy, or will perfect the title as insured, at its own expense. Blah Blah Blah, let’s give a real life example already!!!!
This story just came up the other day. Buyers purchased their home and they had a terrible run in with a title company that was not doing their due diligence on clearing title. The title company is supposed to order what is called a “run down” search the day before closing to see if any liens or judgments were recorded in the county during the time of the original search and the date of closing (average time lapse of 30-90 days from original search to closing). The seller’s took out a home equity loan after the original search and before closing, so it was not picked up in the original search. So $150,000.00 later and after closing, that lien was now the responsibility of the home buyers because it was never caught until they refinanced a couple years down the road. Even worse, the seller’s continued to draw from the line of credit and ran it up to the full $150k amount. The buyers (current home owners) then had to file a claim with the title company that has now gone out of business. Guess who else was never found? Yup, you got it right, the sellers! They took off and managed to steal $150k without anyone knowing for years! Oh, I am just getting started, please look out for next week’s blog for more on why title insurance is so important to have, and why it is even more important that you pick your own title company! Next week we will dive deeper and discuss the lender’s policy and the ongoing question of “I just got title insurance a year ago when I purchased, why do I need it again when I am refinancing only one year later?!”
- Luke Tyler, President and CEO