one MEEN Ag said:
chuckd said:
Stive said:
Title insurance once had a place. I'm not sure it does anymore. The amount of title claims that hit each year is TINY.
With the modern electronic world in which we live, I think a new model will arise in the not so distant future and adjust how that arena plays the game.
I know I'm in the minority, but I've made 3 title insurance claims in my house buying life of 13 years.
Chukd, you've got some story to tell. Because that isn't normal in the slightest.
The first was for the first house I ever bought in 2007. I tried to sell in 2010 and the buyer's title company discovered 3 city of Houston easements not on my Schedule B, one of which was for a 10' wide storm water sewer pipe (you could drive a car through it) that ran directly under the house. The easement itself was 20' wide. This was a 5000 sq ft lot so it encumbered most of the lot and almost all of the house structure. The sale fell through and I made a claim with my title company which paid out 75% of the policy and I've rented it out ever since. Interestingly, I've since had the city revert 2 of the easements that were inactive and the third (the storm sewer) has language in the easement that says the owner has the right of construction over the easement. So I may be able to sell that after all.
The second was for a 6 acre property north of Austin we bought and lived in for a year before we decided to move back to Houston. We determined we would make more money and it would be easier to sell by subdividing and selling 3 acres with the house and 3 acres with raw land. The property backed up to a dam and the entity that controlled the dam would not allow the subdivision. Essentially the raw land portion I was going to sell was part of their auxiliary spillway and they would not allow any development on it. I said that's great, but it's my property and I can do what I want. They pulled out an easement not on my Schedule B and so I made a claim with my title insurance. They acknowledged the claim, but it took some back and forth on the damages. We ended up in mediation and got another sizable payout. Though it ended up being a pain selling the full 6 acres which is why I wanted to subdivide in the first place.
The third was for a rental property I purchased in Pasadena. It backed up to Vince Bayou. About a year after renting it out, the tenant asks if they can extend the backyard fence out further to have a bigger backyard - there's about 50 ft between the existing fence and the bayou. I look down the bayou and notice all the fences are generally in the same location relative to the bayou so I said that the Flood Control District probably determines where the fences go. But I pull out my survey and said I don't see any sort of easement so I don't see why not. I call up the Flood Control District and they did have an easement not on my Schedule B. Made a claim and got a nice little payout.
In all 3 cases, the title company missed recorded easements. The process for all 3 was the same. They essentially got an appraisal that determined the value of the property with and without the easements and they paid out the difference.
