What is title insurance? Is it required when you are buying northern Michigan real estate? Is it required when purchasing vacant hunting land or acreage? These are all questions that most people are unsure of because most people only buy and sell a few homes in their lifetime.

Title insurance is usually a seller's expense. It is where a third party, a title company, is guaranteeing to the buyer that the seller has the right to sell the piece of property. Title work will show any bank, IRS or outstanding judgments that are showing up as liens on the piece of Michigan property as well.

Most Michigan real estate companies I know require their sellers to purchase title insurance upon the event that the real estate company brings a buyer to the table willing and able to purchase. In fact, I know of real estate companies that will have "pre-lims" done on any listing they take. This is where the title company will do a title search free of charge, so that if there are any problems, they will be taken care of by the time a buyer is found for the property. When the piece of Traverse City Michigan real estate or Petoskey Michigan real estate is sold, then the title company would be reimbursed for their title work.

Title insurance is based upon the sale price of the piece of property. You can call any title company to get the rates. I believe title insurance has near a universal cost in the state of Michigan.

When the time comes to purchase a piece of northern Michigan real estate or Upper Peninsula Michigan real estate, I would make sure title insurance is included in the transactions. Often times on "For Sale By Owner" situations, this subject comes along later in the transaction and it's usually something nobody has thought about. I've seen it happen many times where that is in fact why the piece of property is being sold "For Sale By Owner" because the Michigan real estate offices require title insurance and the seller knows there are clouds on the title. Buyer beware!