Buying a home is one of the most emotional and confusing transactions you may face in your lifetime. As settlement professionals, we are asked to explain many things, but we mostly get questions on title insurance. "Why do I need title insurance?", "What is it for?", "Why do I have to pay for lender's and owner's title insurance?", "Shouldn't one policy be enough?"

Here's the answer: Your title refers to your legal right to possess and use real property. Title insurance exists to protect the lender and the buyer from hazards on the title, which might aff ect your right to the property.

Title Hazards. Title hazards are generally referred to as defects. There are probably 200 or more defects to real property that can't be discovered even with the most detailed title search. These defects or mistakes began from the time the original land that your home sits on was first recorded. Even if you have a new home, the land has been passed from owner to owner.

Hazards can include:

• Mistakes in Recording Deeds
• Misfiled Records
• Fraud
• Forgery
• Deeds by Unsound Mind
• Inheritance Problems
• Creditor Issues