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Reader Question (Part 3) – With a Few Extra Bucks, What Can I Get a Title Company to Do?
In Part 1, I discussed a title company’s common roles in a real estate deal. In Part 2, I covered some of the normal risks that a title company assumes in the base title policy. Now, lets see what a title company will do for a little extra money…
In addition to the base policy, you can also get endorsements to the policy for an additional cost. Here are some of the risks that a title company can cover with endorsements:
- that the land doesn’t have access to a public road
- if there is some structure on the land that violates a restriction or encroaches on a setback, easement or off of the property, the title company can assume the risk of a loss in this scenario
- damage to a structure from a mineral owner’s activities. This can be an existing structure or one that you build in the future. Usually the mineral owner’s rights trump the land owner’s rights, so this can be an important risk for the title company to assume in an area with mineral activity. (The title company still has to make the underwriting decision to accept this risk.)
Due to the heavily regulated nature of title insurance in Texas, there are only a limited number of endorsements that you can purchase. Here is a list of the endorsements and related forms that you can get in Texas.
In other states, a title company usually has more endorsement options when it wants to assume risks in a deal. Here is a resource you can use to see what’s available in states that use the ALTA forms.
On another note, normally when we think about title insurance, we think about it in the context of the owner of the land or its lender. You can also get title insurance for an easement, lease or life estate.