WHAT CLAIMS OR DEFECTS ARE NOT COVERED BY TEXAS TITLE INSURANCE POLICIES???

In general, a title policy won’t cover problems with your title that occur after the date you purchased the policy. It will also not protect you from problems that you create or from problems unrelated to your or the lender’s property interests.

Your policy also will not cover any special exceptions – such as a public utility easement – added by the title company during the title examination process. These exceptions must be listed in Schedule B of your policy. The company must make you aware of each exception and describe it using common language so that you can easily locate the reason for the exception in public records.

In addition, a title policy generally will not cover the following:

The penalties of your failure to pay for your property.

An unrecorded title defect that you knew about or allowed to occur.

Violations of building and zoning ordinances and other laws and regulations related to land use, land improvements, land division, and environmental protection.

Restrictive covenants limiting how you may use the property and stating the requirements for buildings constructed on the property. Schedule B lists these restrictions. Be sure to request copies of any restrictions and have your attorney explain them. The title company may charge you for the copies.

Losses resulting from rights claimed by “parties in possession,” such as renters or anyone else occupying the land. If you object to the exception, the title company may inspect the property and delete the exception from your policy. The title company may charge for the inspection.

Condemned land, unless a condemnation notice appeared in the public record on the policy date or the condemnation occurred before the policy date.

Homestead, community property, or survivorship rights of a policyholder’s spouse. Texas homestead laws address the rights of a spouse or survivors of a property owner.

Title irregularities arising from a deceased person’s estate, a bankruptcy estate, or a trust.

Claims from other people who may have certain rights if your property is near a body of water or has a river or stream flowing through it.

Certain taxes and assessments. Your title policy ensures that all property taxes and assessments are paid for the most current year available. However, certain tax exemptions claimed by previous owners could result in more taxes being assessed against your property in the future. If you buy property with borrowed money, the lender may ask that its mortgagee policy delete the exception for “subsequent taxes and assessments by any taxing authority for prior years due to change in land usage or ownership.” In such cases, the title company may require that the taxes be calculated and paid.

Before purchasing or accepting a Texas title insurance policy, you should consult an experienced Texas real estate attorney to address your coverages and property rights. San Antonio lawyer Trey Wilson of R L Wilson, P.C. law Firm was recently named by his peers as one of San Antonio's best real estate litigation attorneys. He regularly reviews, makes claims under, and challenges Texas title insurance policies. he may be reached at www.sa-law.com or 210/223-4100