People who pay cash for real estate in Florida are not required to buy title insurance. While the State does not mandate this and there’s no lender to impose its own requirements, whether you should buy title insurance is a different story. That’s a question buyers need to answer for themselves.
So why buy title insurance when paying cash? Title insurance protects the new owner’s right to own and use the property they’re buying. To be clear, title insurance won’t prevent a title dispute from arising in the future — just as having auto insurance won’t prevent getting into a car accident.
However, title insurance can protect a property owner from losing money (or losing ownership of the property altogether) if someone else presents a legitimate claim after closing. That’s a big deal.
Shouldn’t paying cash and signing the deed be enough to guarantee their right, within the law, to own and use the property?
Unfortunately, things don’t always pan out this way. In reality, many things can arise after closing, such as:
Past deeds and other documents may have been improperly drafted or recorded
Someone may have forged signatures or found other ways to defraud previous owners
Multiple heirs of the Seller may have inherited the property without knowing it yet, and only one heir signed the deed
A previous owner may not have paid all property taxes
A previous lender may have a lien on the property that was not properly satisfied
Neighbors or utility companies may have obtained a legal right to use the property
A title search will uncover some of these things if they were recorded. But as with anything in life, things can slip through the cracks. Although it is very rare, problems can arise in the future.
Facing a legitimate ownership claim on your own, with no title insurance coverage, could cost tens or hundreds of thousands of dollars, or more, to resolve.
Florida title insurance provides a simple way for cash buyers to protect themselves for as long as they own the property. Unlike auto, home, or life insurance, title insurance is a one-time expense. Paying one, upfront title insurance premium protects your ownership rights until you sell the property, a very wise expenditure to protect your biggest asset.
At Butler Title, we’re always looking for ways to help our clients get the most from their property purchases. That’s why we recommend title insurance for all our clients, and that’s why we do everything we can to make the insurance coverage more affordable. For example, we extend Florida’s Butler Rebate to every client, even if they don’t ask about it. Contact us to learn more about title insurance and Butler Title’s closing services.
Butler Title is a full-service, attorney owned and operated title insurance agency. We keep it simple and focus on what we do best: real estate closings. From first-time buyers to local moguls, BT provides an industry-leading fee structure and unparalleled experience.
P: 954.616.8735 F: 954.206.1097