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Title Insurance



 

What Is Title Insurance?

Title insurance provides homeowners and lenders with no-fault protection against title risks inherent in real estate transactions and fraud.  Our firm does receive a Reviewing Counsel Fee from First Canadian Title on policies that we place through the title insurer, but the cost of this to the client is less than the cost of the searches that are replaced by title insurance and are no longer required.  Title insurance is a means of insuring or indemnifying homeowners or lenders against loss or damage sustained by reason of;

  • Liens, encumbrances, or defects in the title to a property.
  • Defects that would have been revealed by an accurate up-to-date survey.
  • Survey errors or illegibility.
  • Forced removal of an existing structure, other than a boundary wall or fence.
  • Work order, zoning and set back non-compliance/deficiency.
  • Another party claims an interest in the property.
  • The land is unmarketable, which allows another person to refuse to perform a contract to purchase, lease or make a mortgage.
  • Fraud, forgery, duress, incompetence, incapacity or impersonation.
  • Unregistered easements and rights of way.
  • Loss of priority due to matters such as construction liens, agreements registered on title, and other mortgages.
  • Lack of pedestrian and vehicular access to the property.
  • Specific post-policy event coverage, as outlined in the Gold Policies.
  • The authenticity of registered documents on title.
  • Invalidity or unenforceability of the insured Mortgage upon the title.

 

Identity Theft & Real Estate Title Fraud

By: Rubina Ahmed-Haq Special to The Toronto Star,

Published on Sunday, April 8th, 2012

One of the least common crimes associated with identity theft is real estate title fraud.  But if it does happen the impact can be huge and difficult to unravel, says Raymond Leclair a real estate lawyer at LawPro.  The average amount stolen in title fraud is in the range of $300,000 compared to credit card fraud, where it is $1,200.

Here’s how it might work: The criminal targets a house and by stealing mail is able to build a financial profile with bank accounts, bills and credit and mortgage information.  With that forged identity the criminal walks into a bank and asks to take out a second mortgage secured by the home.  The fake identification is verified and since the house title is in the correct name, the banks are less likely to ask questions.

The bank offers the money in the form of a line of credit that can be used with a bank card or by writing cheques.  In most cases the legitimate homeowner does not find out what has happened until the loan statements show up in their mailbox.  Now they are left with the task of proving that they were victims of identity theft and did not borrow any money.  Banks are often sympathetic to victims of title fraud, but like credit card fraud they conduct their own investigation to figure out what happened.  In the case of real estate fraud it can take years.

In the end, the matter is often sorted out, but in the process victims can face legal bills, banking issues and ruined credit history.  Also, the perpetrators of title fraud are often never caught.

First Canadian Title has been offering title insurance since 1991. FTC vice-president Susan Leslie says the volume of identity theft claims at the company is low but the dollar value of each is high.  Of all the complaints they get, only one per cent are deemed cases of identity fraud, but the crime represents 12 per cent of the claims paid by FCT, she said.

For a home valued at $450,000 in Ontario, title insurance would be a one-time fee of $432.  “Don’t wait until it’s too late, be proactive and stay on top of all the activity that takes place under you name,” says Sgt. Luce Normadin, the RCMP’s national identity fraud coordinator.

  Read the entire article here