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Title Insurance Can Protect Against Property’s Hidden Past

STEUBENVILLE -- Old mortgages, judgment liens, forged deeds, unknown heirs and even issues with vacant land can lead to problems when someone tries to buy or sell a home or property, and that’s why it’s important to consider title insurance before a deal is made.

That’s the message Jess Kelley shared with members of the Steubenville Kiwanis Club Tuesday afternoon.

Even though a person has decided to buy a house that appears to be a perfect fit for their family, it’s important to remember that every home has a generational history and a background that is not known, she said while speaking at the Sycamore Youth Center.

Kelley is a client service specialist for Northwest Title. The firm’s Steubenville office is one of four in Eastern Ohio, with other locations in St. Clairsville, Cambridge and Zanesville.

An issue that could sometimes come up, Kelley explained, is an old mortgage that could show someone from the past might continue to owe money on the property.

Judgment liens are another issue that can lead to problems with property, she added.

“Let’s say someone owned the house for 10 years and got into some debt and didn’t pay off his credit cards,” she said. “He might not even know the credit card company has reached out an filed a lien against the house.”

Without a thorough title search, Kelley added, in Ohio, that debt would have been attached to the property, and not the owner, which means it would transfer with the property and become the responsibility of the new owner.

Forged deeds are another issue that can affect a subsequent owner of property, she added. Those can include a forged notary signature on a document that is then recorded at the county courthouse. Those circumstances make the situation difficult to uncover.

Issues arising from unknown heirs, she said, can lead to problems.

“Say someone knocks on your door five years after you’ve purchased a house and says, ‘Hi, I own a piece of this,'” Kelley said. “Even if it’s not true, even if it’s not valid, you will have to seek out an attorney and pay the fees just to combat what this person is saying.

“So, what are you going to pay to retain an attorney? The reason to get title insurance is because it protects the past,” Kelley said. “Everybody gets homeowners insurance and you get insurance on your car. Nobody expects to total their vehicle, right? But you get it. First, because you have to. And then, if something happens, you don’t find yourself up the creek without a paddle.”

Title insurance, she added, is not about what can happen in the future -- it is what happened in the past that you are getting insurance for.

Land that has sat vacant also can lead to concerns. Kelley discussed a situation where someone had driven past a piece of land that they owned and discovered that the property had been “sold” to someone by someone else, and they had started to build on the land. In that case, you had someone who had purchased land that was not properly sold to them and already had disrupted the land.

Without title insurance, that person would have been out the money they paid for the land and would have paid to fix the land they had started to build on, Kelley said. In our part of the Ohio Valley, she added, the buyer makes the decision on what title company will be used in the transaction, while in other parts of the state, it’s the seller who decides.

Title insurance, she added, is a one-time cost, and it offers a way for a person to protect themselves. Northwest Title can serve clients in Ohio and West Virginia, she said.

Issues surrounding property can cost a person much more than the price of the insurance, she explained.

“It’s scary, like when you hear about the fraudulent practices,” Kelley said. “I think, in general, we are very trusting people, and, in general, things take a little longer to get to us, like fashion. I think sometimes we think that happens in bigger areas or that people don’t forge deeds here, but, unfortunately, they very much do.”

The Steubenville office of Northwest Title can be reached at (740) 214-4360.