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With COVID numbers on the rise, it's normal for anxiety levels to ratchet up a bit.

One thing that you'll be able to rest a bit easier about, assuming that you've got a good policy of title insurance in place, is your ownership interest in your home.

This month, we conclude our visit with Ken McAlister, Vice President, Treasurer, and Attorney for Texas Secure Title Company. If you missed the first part of the interview, you can find it here.

So, read on to discover more about protecting your home - it's what you do when you

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Protecting Your Home - Title Insurance Part 2
Kenneth L McAlister

Ken McAlister is a Fort Worth native who came home after attending Texas Tech University School of Law.

He started his legal career trying civil lawsuits and representing people in family law matters.

After many years of handling cases that often involved real estate disputes, Ken opened a title company fee office in 2010. Later, in 2014, he and his colleagues opened Texas Secure Title. Ken currently serves as Vice President, Treasurer, and Attorney at Texas Secure.

Texas Secure has offices in Fort Worth, Colleyville, Burleson, Bedford, and Farmers Branch, but they understand the special demands of the times and can close your transaction virtually anywhere.

Interview with Ken McAlister - Part 2

HHA: When we left off last time, you were about to give us a history lesson to explain the process of a title search.

KLM: That’s right. I promise I’ll keep it as short and as little coma-inducing as I can.

HHA:  Okay, professor, fire away.

KLM: Let’s start with this: Real Estate is special. The law recognizes that each square foot of land is unique. If you’re going to buy or sell it, you have to make sure that everyone knows precisely what is being bought or sold. So you have to describe it in writing, well enough that a stranger to the transaction will know by looking at the description exactly which piece of land is changing hands.

HHA: That’s called the Statute of Frauds, right?

KLM:  That’s right. Remember last time when we talked about the different kinds of interests that can exist in a given piece of property – like liens and such? Well, since anything affecting the ownership of a piece of property has to be in writing, you can rest assured that there is a piece of paper somewhere specifying all of those details.

The law also says that each county will have a place for all of the papers reflecting interests in real property to be kept. It’s cleverly called the “Real Property Records” in the County Clerk’s office. 

County Clerks maintain all kinds of different records. Real Property Records is just one type. As you might imagine, searching through all of those records for the ones relating to a particular tract of land can be quite a chore. And that’s where the title company comes in.

In each county where it does business, a title company has what amounts to its own database of real estate documents covering all of the land located within that county. This collection of information is called an “abstract plant.”

Imagine gathering all of the documents affecting a particular piece of property, going back in time to what’s called the “sovereignty of the soil” – before there were any private owners and the state owned the land. In Texas, that is back to the Republic of Texas. The resulting collection of records – of every transaction that ever occurred concerning that piece of land – is called an “abstract of title.”

The abstract of title for a single piece of land could – and often was – a stack of paper a foot thick.
HHA: That’s a lot of paper. But what’s the purpose of an abstract of title? Is it something that you get when you buy land?

KLM:  No. Before title insurance, the only way to make sure that there wasn’t something bad affecting the title to the property you want to buy – like the contractor’s lien we talked about last time – was to have a lawyer read all of those documents and give an opinion. And that could be very, very expensive – many thousands of dollars.

HHA:  Wow! I’ll bet. So, how is it different now?

KLM: Now, for the cost of the title insurance premium, the company does a “title search,” which essentially means that the company uses its abstract plant to trace the property, and a title examiner closely inspects the last several transactions. Based upon that review, the company issues a “title commitment,” which says, essentially, “we’ll agree to defend your title to the property.” This is assuming that nothing adverse pops up in the search, like a contractor’s lien.
HHA: What happens if something bad does pop up?

KLM:  The title company will tell you and require you to fix those problems before it will issue the policy. And, I might mention, the title policy doesn’t cover things like restrictive covenants – such as, say, conditions that an HOA puts on a residential lot – or easements.

Easements are things like the right of the city to run water and sewer lines through specific areas. But you’ll be able to see those things in the commitment report, so they won’t be a surprise.

Since it might be relevant to some of your readers, I also should mention that title insurance doesn’t cover mineral leases.

HHA:  Whose responsibility is it to fix anything that pops up?

KLM: Typically, the seller. The standard contract for the sale of real property in Texas puts the burden on the seller to deliver an acceptable commitment for title insurance to the buyer. If that doesn’t happen, the buyer can terminate the contract.
HHA:  So, bottom line, why should someone have title insurance?

KLM: Usually, there are two reasons. The broad, over-arching one is that it provides peace of mind. When you’re making the most significant investment that most people ever make, you want the comfort of knowing that, even if someone comes out of the woodwork after the sale claiming that they own the land, you’re protected. The second, more practical reason that applies to most people is that the mortgage company won’t loan the money for the purchase if you don’t get title insurance. 

HHA: Very quickly, you said last time that the general rule is “Whoever pays the premium chooses the title company.” You also mentioned that title companies act as escrow agents. So, does that mean a title company is acting as an escrow agent for the party who pays the premium?

KLM: No. Acting in an escrow agent capacity, the title company is strictly neutral – no matter who pays the premium for the title policy.

HHA:  Any final comments?

KLM:  Buying a home can be a stressful experience. Just as it’s crucial to have a real estate agent that you trust, it’s important to use a title company that focuses on customer service so that the transaction goes as smoothly as possible. Texas Secure is that kind of company. We hope you’ll give us the chance to prove it.

HHA: Thanks, so much for sharing with us.

KLM: My pleasure; thanks for asking.

Debra’s experience in home renovation, staging, styling, and design sets her apart from the crowd in the Fort Worth area real estate market.

  • Creativity to re-imagine existing spaces for broader appeal.
  • Vision to see opportunities where others see problems.
  • Insight to know what buyers are looking for.

Debra doesn't just listen - she empathizes.
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Debra doesn’t just sell property - she maximizes potential.
She helps her clients find harmony in their lives.

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