Posted by David Krulac on June 16, 2003 at 12:20:25:
title insurance requires a search and abstract and review, sometimes by an abstractor and/or an attorney. When they are satisfied that there are no title issues then they issue title insurance.
Here in Pa. you can also get an attorney’s certificate of title in lieu of title insurance for a slightly less costs. However the cert is only as good as the attorney is eligible for the census, and does not survive him/her. Title insurance on the other hand is good for as long as the company issuing it is still solvent.
I am looking for some information on the differences of Abstracts vs Title Insurance in Iowa.
A father of a friend of mine is an attorney in Iowa and he has what is called an Abstract company that supposedly is how Iowa deals with Title insurance.
Does anyone have experience with this? Does anyone here understand fully the process in Iowa. I would ask him but I would like to understand what I am telling him before I actually talk to him.
Re: Abstracts NOT Title Insurance in Iowa - Posted by B.L.Renfrow
Posted by B.L.Renfrow on June 16, 2003 at 24:13:36:
It’s been a few years since I lived in Iowa, and I wasn’t involved in real estate then, but from what I recall, your friend is correct.
Unless things have changed recently, Iowa is the only state which prohibits the sale of title insurance by an Iowa company. Consumers aren’t prohibited from purchasing it, but an Iowa company cannot sell it.
Title work is done by abstractors, who review the chain of title and prepare the abstract, then an attorney issues a title opinion. Many, if not most, “abstract companies” are operated by attorneys.
Iowa has a state-funded title guarantee program. If there’s a title error, that fund is supposed to provide coverage. One could also bring suit against the attorney and/or abstractor for missed title issues.
Re: Abstracts NOT Title Insurance in Iowa - Posted by Ken (in Iowa)
Posted by Ken (in Iowa) on June 16, 2003 at 10:38:29:
Brian did an excellent job of summarizing the situation in Iowa. We are the one and only state (unless things have changed somewhere else, which I doubt) that does not generally use title insurance. Having never bought or sold real estate in any other state, I can’t speak very knowledgably on the differences, but I would guess that being able to simply buy title insurance would make the closing process faster than having an abstract company bring the abstract up to date, delivering it to an attorney for a Title Opinion, having to correct any problems noted by the attorney, then delivering the abstract back to the abstractor for final filing along with any new papers needed to clear title. On the other hand, having gone through all of that, a new property owner theoretically has a 1) “guaranteed” clear title, and 2) someone to go after (the lawyer who did the title opinion) if something comes up later that creates a cloud on the title. Hope this helps.