Does Title Insurance Cover Zoning Issues?
If you are planning to purchase real property in the Commonwealth of Pennsylvania you will most likely purchase title insurance as part of the purchase process. If this is the first time you have purchased a home you may realize you need title insurance but you may not know exactly why you need it nor understand what title insurance covers and what it does not cover. For example, does title insurance cover zoning issues?
For most people, the purchase of a home is the single largest purchase they will make during their lifetime. Buying a home is not just a huge financial investment though, it is also a highly emotional personal investment. Understandably, you want to protect that investment. Having a thorough inspection of the property completed prior to closing on the home is one way to protect yourself against buying a home with costly defects; however, what about defects in the actual title to the property? Those defects cannot be seen; yet, they can turn your dream of home ownership into a nightmare overnight. If it turns out that the seller did not have clear title to the home when you purchased the home you have a serious problem on your hands. Title insurance protects you from just such a scenario.
Title insurance is an insurance policy that protects the new owner of property against loss in the event the title to the property is less than clear. Should an issue with the title appear down the road, and it turn out to be a valid issue, your title insurance policy will cover your subsequent losses. For example, if there is a lien on the property that was unknown to the seller, or if an heir to a previous owner suddenly asserts a claim to the property, it could threaten your absolute ownership of the property. When you purchase title insurance the title insurance company will conduct a thorough investigation to try and uncover any potential defects in the title before agreeing to the write the policy. That assurance, coupled with the policy against loss itself, significantly reduces the risks associated with purchasing a home.
Because every title insurance policy is unique it is always wise to have your Pennsylvania real estate attorney review the policy you are considering. As a general rule, however, zoning issues are not covered in a basic title insurance policy. Most title insurance companies offer extended coverage policies that may include zoning issues but as purchaser will pay an additional premium for that extended coverage.
If you are planning to purchase a home it is wise to consult with an experienced Pennsylvania real estate law attorney throughout the process to ensure that you have a firm understanding of the process and the documents you will be required to execute. Contact the real estate law attorneys at Curley & Rothman, LLC by calling 610-834-8819 today to schedule your consultation.