Title Insurance is an essential piece of a real estate transaction; however, it can be somewhat complicated and potentially difficult to understand. Here, we’ll offer a brief overview of the Title Commitment, specify the roles and responsibilities as they relate to you and us, and provide links to articles and videos that will help further your understanding.
Once you are under contract for the purchase or sale of a property, you will receive a Title Commitment, also called a Preliminary Report. Here’s what you can expect to find in the Preliminary Report:
-
- Name of the Owner of Record: This should match the seller’s name.
- Legal Description of the Property: A legal description is a precise set of instructions for identifying and locating a specific piece of land – similar to GPS coordinates. It defines the exact boundaries of a property down to the inch. While addresses can sometimes be confusing or imprecise, legal descriptions avoid mistakes by being tied directly to the property’s physical boundaries.
- Plat Map: Often provided as a link within the Exceptions section.
- Exceptions/Exclusions: Similar to other types of insurance (auto, home, life, etc.), title insurance includes “exceptions”—specific items or scenarios not covered by the policy. The Title Commitment you receive details these exceptions.
Roles and Responsibilities:
Our Role:
-
- Verify the accuracy of the “facts” in the Title Commitment/Preliminary Report (e.g., name, legal description, purchase price).
- Answer your questions when possible. For complex matters, we’ll refer you to title professionals or attorneys as appropriate.
Your Role:
-
- Review the Preliminary Report thoroughly.
- Take time to explore the linked videos and articles provided below to build your understanding.
- Make a note of any questions or concerns and reach out for clarification.
Colorado Real Estate Commission article & FAQ on Title Insurance
Why Title Insurance is Right for You