Sunday, September 27, 2009

TITLE INSURANCE IN THAILAND AND OTHER ASIAN DESTINATIONS

Summary

Up until recent times, the concept of private or individual land ownership was practically unheard of. In the ‘Middle Ages’ it was only the kings, Lords and the privileged few that were able to proclaim ownership to lands that had been conquered.
Analysis

Land, unlike personal possessions that can become obsolete, and lose their value, is immobile, and by comparison, indestructible; therefore, anything associated with land and its control became a symbol of power and wealth
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The feudal lords that were appointed by the various monarchies’ to occupy and work these lands were granted the privilege by way of licenses. However, these lands were subject to the king's first rights, as well as taxes on the land and taxes on the produce.
Over time, the feudal lords that wished to maintain ownership of these worked lands, developed methods of obtaining conveyances from the monarchy that eventually allowed the property to be inherited by their beneficiaries, rather than revert it back to the monarchy. However, there always has and always will be vulnerabilities in relation to land ownership!
Prior to the advent of ‘Title Insurance’, the conveyance of property did not include any form of guarantee or insurance. A purchaser had virtually no guarantees that the property he was buying was even owned by the person that was selling it! And, even though lawyers would render their opinion of title based upon a title ‘abstract,’ there were no assurances protecting the buyer from fraudulent conveyances or undisclosed encumbrances on a property?
What is ‘Title Insurance’?
‘Title Insurance’ is a contractual obligation between the buyer of land/property and the ‘Title Insurance’ company (insurer), whereby the title insurer, in exchange for a premium payment, provides protection (effective as of the date the title insurer issues the policy) against future losses that might result from a variety of possible title defects or encumbrances.
Why Do You Need ‘Title Insurance?’
As a ‘Property Developer’ in South East Asia, owning real estate is one of the most precious values of freedom in the civilized world, and by having the assurance that the property you are buying will be yours, other than your mortgage/finance company, no other entity should have any claims or restrictions against your property.
‘Title Insurance’ eliminates any risks and losses associated with faults in title from an event that occurred before you owned the property! And as a ‘Property Developer it is essential you take the necessary steps to protect yourself and your clients.
What is a ‘Title Search’?
Part of the cost of ‘Title Insurance’ includes a title search, in which the title insurer conducts a detailed examination of the historical, public records concerning the property. These records include deeds, court records, property and name indexes and many other public documents. The purpose of the search is to verify the seller’s right to transfer property ownership and to discover any defects or encumbrances on the title. A title search should show all title defects and encumbrances as well as judgments, liens and other restrictions (i.e., unpaid taxes, outstanding loans, judgments against the seller, land-use restrictions, etc.).
On a seller’s point of view his ‘Title Insurance’ policy does not protect a future buyer; as any of the above defects could have occurred during the seller’s ownership. A new title search will need to be conducted by the new purchaser in order to protect his ownership rights when he acquires the property.
How Does ‘Title Insurance’ Protect a Buyer?
‘Title Insurance’ protects a purchaser and his lender from losses resulting from claims against a purchaser’s ownership of the property. It is unique as far as it provides a purchaser with coverage for unforeseen problems or hidden risks associated with errors, forgery, unpaid taxes, that can jeopardize a purchaser’s ownership rights, and as a ‘Property Developer’ in South East Asia, it is essential that you protect the interests of your clients and your company.
Examples of ‘Title Insurance’ coverage includes:

* Protection from financial loss due to covered claims against the buyers title
* Payment of legal costs associated with covered claims
* Payment of successful claims against a buyers title

When considering ‘Title Insurance’ a buyer should be aware of possible exclusions and exceptions such as:

* An unrecorded title defect
* Condemned land
* Building and zoning ordinance violations
* Payments required (except for legal access rights) because the deed failed to provide rights of use to adjacent land, streets, alleys or waterways
* Conveyance of title irregularities arising from a deceased person’s estate, a bankruptcy estate or trust
* Restrictive covenants limiting the use of the property
* Discrepancies, conflicts or shortages in area, boundary lines encroachments, protrusions or overlapping improvements
* Right of usage claims arising if the property is on or near a body of water, river or stream
* Adverse possession claims from “parties in possession” of all, or a portion of the property

Conclusion
When you purchase a property, you buy property insurance to protect yourself financially in case something happens to the property or its contents. However, property insurance won't protect your financial interests if a matter arises regarding the legal title of the land on which your property is situated. Unless a property owner possesses a clear title, he risks losing his property and the land under it. This is where ‘Title Insurance’ comes in and why it should be a absolute requirement for any foreign owned ‘Property Developer’ in South East Asia
Claims on title to a property can often relate back to events many years ago. These range from undisclosed easements, tax liens, or lack of due process in upgrades to title. Claims can be issued by other homeowners, business interests, government agencies, even the land department itself.
‘Title Insurance’ provides an indemnity up to the full purchase price of the property against all losses arising from errors, omissions or fraud which may affect the title to the property at the time of purchase. Should a dispute arise, the title insurer will defend the claim, in court if necessary, and indemnify the owner to the full value of the land and the property, plus any necessary legal fees.
The ‘Title Insurance’ cover provides you with a full financial indemnity against any claims against the title of your property by any person, providing you with absolute peace of mind that your investment is secure. You can be assured that you will be able to benefit from your investment freely and without risk of disturbance resulting from fraud, forgery, a weak ownership trail, and previous conflicts.
There is no single better way to protect the value of your property than with ‘Title Insurance’!
As a ‘Property Developer’ or purchaser in South East Asia, it is your corporate responsibility to secure the interests of your clients and your company, by protecting yours and their property with ‘Title Insurance!’
For further information on the benefits of ‘Title Insurance’ for ‘Property Developers’ in South East Asia, please complete the enquiry form, and include your full contact details and exact requirements.
‘Title Insurance’ - Don't Invest In Property Without It!
The information set out above is for guidance only. No representation is made in respect of this information. Policyholders should carefully read their policy. If there is any inconsistency between this information and the policy, then the terms of the policy prevail.
www.forbeslebrock.com

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