pam, Home Seller in 95148

What does title insurance do to protect foreclosure buyers?

Asked by pam, 95148 Sat May 12, 2012

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Gabriel Nguy…, Home Buyer, San Jose, CA
Sat May 12, 2012
Hi Erika, did you mean foreclosure buyers at auction? If so, the answer is no. If you buy an bank owned property, then title company will sell you title insurance. Why? Because banks are already took ownership of the real property and all liens had been cleared.

Gabriel Nguyen
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Steve Quinta…, Agent, Albuquerque, NM
Mon May 21, 2012
Title insurance covers you for claims against your title. Title insurance does not guarantee you clear title, but it does guarantee you that you will get a defense if your title is attacked or proves to be defective.

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Roland Vinya…, Agent, Sprakers, NY
Sun May 13, 2012
In our area, tax or other public auctioned property has all liens erased by the tax foreclosure. There are certain exceptions and they may be things you wish to do to further clear the title, but these are still exceptions.

All of which serves to let people who read this to know that the practice of real estate varies considerably by location, even in legal matters such as this.
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Keith & Kins…, Agent, Verona, WI
Sun May 13, 2012
Like Gabriel mentioned, if you are buying a foreclosure after the bank has foreclosed and owns it, the title transfer will be similar to a normal consumer transaction. There will be title insurance issued that protects you if there were any liens on the property that the title company didn't find, but otherwise you should be getting a free and clear title.

If you buy at a foreclosure auction, typically all the liens go with the property and the new owner is responsible for clearing things up. Be careful and know your stuff if you go the auction route.
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