What is Title Insurance?

Title Insurance safeguards against loss that may arise from hazards and defects that already exist and affect your legal claim to the property you are buying.

What does Title Insurance do?

Title Insurance protects the insured against items such as:

  • ERRORS – Documents that are misindexed in the public records due to a clerical mistake or documents misplaced before being properly recorded.
  • UNKNOWN HEIRS – Legitimate heirs that may have been overlooked in the probate process or an heir thought to be deceased who may have a claim to interest in the property.
  • FORGERY – Forged deeds, releases of mortgages and other documents in the public records.
  • FRAUD – Deeds made by persons claiming to be single but in fact married or by individuals falsely impersonating the true owner.
  • EASEMENTS – Unrecorded easements that provide access for construction of roads or utility lines at a later date.

There are two types of title policies available; lenders and owners. Lenders requires the homebuyer to purchase a lender’s policy, as it secures the lender’s interest. An Owner’s policy is available, which covers the homebuyer’s financial interest.

What does a Settlement Agency/Title Company Do?

Orders title search, surveys and payoffs
Clears any title problems
Prepares the Title Insurance binder/commitment
Verifies taxes, HOA fees, ground rent, condo fees
Prepares HUD1 according to closing instructions
Conducts settlement
Copy and ship closing packages
Disburse funds
Ship payoffs
Records legal documents
Obtains release
Records release
Prepares Title policy

How much does Title Insurance cost?

Please get in touch for a Fee Estimate.

Am I required to purchase Title Insurance?

Most lenders require you to purchase lender’s insurance, but you are not required to purchase an owners policy. You are strongly advised to; however, because it protects your property for as long as you own it.

Where can I get Title Insurance?

You can get insurance from any licensed settlement agency/title company in your state. It is important to search for a company with experience and expertise. Title Insurance is normally purchased at the time of settlement.

Withholding Requirements for Sales of Real Property by Nonresidents

If you are a nonresident who owned and sold or transferred real property and associated tangible personal property in Maryland, you must make a tax withholding payment to the local Clerk of the Circuit Court or the Maryland Department of Assessments and Taxation (MDAT). The payment must be made before the deed or other instrument of transfer is recorded with the court clerk or filed with MDAT.

In the case of a nonresident individual, the payment is 7.5 percent of the total property sale payment made to the individual. A nonresident entity must make an 8.25 percent payment.

Under this provision, a nonresident entity is an entity that is:

not formed under the laws of Maryland more than 90 days before the date of the sale of the property, and
not qualified by or registered with MDAT to do business in Maryland more than 90 days before the date of the sale of the property.

In the case of multiple owners, withholding is required from each of the nonresident owners based on the percentage of the total payment that represents each nonresident’s ownership percentage.

You must complete Form MW506NRS, Return of Income Tax Withholding for Nonresident Sale of Real Property, and present copies A and B of Form MW506NRS to the clerk or MDAT, along with payment.

In addition to filing Form MW506NRS with a tax withholding payment, you are still required to file an end-of-the-year income tax return with Maryland for the year in which the sale occurred.

For more information, see Maryland’s Withholding Requirements for Sales or Transfers of Real Property and Associated Personal Property by Nonresidents.


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