Titles insurance | Housing | Finance & Capital Markets | Khan Academy 

And yes, I know that bona fide implies "without notice" so what I said is redundant. Either way. lol

Title Insurance Owner’s policy provides these benefits (scroll to the bottom for the answer about the crazy person): 1) Comprehensive Title Search / Abstract: Process that reveals any adverse matters under the duration of a set amount of years (30, 40, or 50 years’ Chain-of-Title search scope, depending on the state’s Marketable Title laws.) Any funny business found via record title will be made manifest. Keep in mind that any legitimate claims one may have over the real property must be, at least hypothetically, evident to the public via Constructive Notice - i.e., to be filed in the County Recorder or Register of Deeds, and in the Courts Records in some states, wherein other people can verify (think of Constructive Notice by picturing a bulletin board or some public kiosk giving notice of dealings and agreements). 2) Title Curing / Clearing: Once said adverse matters are brought to light via title search, then the Title Company will “cure” the property title from said adverse matters through various legal and bureaucratic means. Curing title involves, but is not limited to, paying off / releasing, assigning, or subordinating the liens encumbering the property; resurveying the property to accurately reflect its legal description; filing Scrivener’s Affidavits; resolving HOA issues; correcting interest disputes; hiring attorney to settle said disputes via Quiet Title Suit; paying legal damages; and so on. 3) Peace of Mind: Once title is cleared and cured, then the property is now considered Marketable and past wiped clean. You now own the property in “Fee Simple”, and enjoy the Bundle of Rights conveyed via General Warranty Deed by the Grantor to you, the Grantee, with the Title Company overseeing, insuring and ensuring the whole thing. Also, any future adverse title matters or defects that could occur by a future title search, or in your example with the crazy person “just showing up”, then you will have legal recourse to protect yourself and your property. If a future title search reveals past claims prior to the vesting into title, then the title company and/or search company will be liable for those damages / claims (e.g., by eating the cost and paying the lien or any other miscellaneous penalties). The owner simply contacts their policy holder and then they handle everything. If it turns out that the crazy person does have a claim or some interest, then that’s up to the Title Company to fix and worry about, and is ultimately the Law who shall, in the end, decide who’s what’s, and what’s who’s. TL;DR: If a crazy person showed up at your door saying that the property is theirs, then firstly call the authorities if there’s threat and provocation, and thereafter contact your Title Company.

that's were the attorney comes in during the under contract phase of purchasing. They do title search I think it it goes back 30 yrs in NC. after that is completed the titile insurance will protect the new owner what was not in the search to begin with. @@DaleEarnhardt_

Term of policy is most critical IMHO most policies are for one year only