Why Title Insurance?
Without a title insurance policy, you may not be fully protected against errors in public records, hidden defects not discovered in the public records, or mistakes in examination of the title of your new property. As a result, you may be held fully accountable for any prior liens, judgments or claims brought against your new property. If a problem does arise the title will be defended without cost to you and if the title, or any part of it, should be other than insured, you will be reimbursed, up to the face amount of your policy, for any financial loss incurred.
An abstract of title is a compilation of historic information concerning a tract of land based on its legal description. An abstract shows the entire chain of ownership from the time the title to the property was first recognized by the government to the present. This set of documents will also include any items filed in the court clerk’s office that pertain to the land. Therefore, the abstract can be used to establish “marketable title” to a piece of property.
Before photocopies, an abstractor read each document pertaining to a piece of property, made “takeoff” notes, and then summarized them on a sheet of paper. This sheet of paper would list all the pertinent information related to an item, such as a deed, by including the grantor, grantee, date of the deed, filing date, legal description, signature block, and notary information. The abstractor’s page was then added to the book and called an abstract, because the information from the original deed was “abstracted.” The ability to sort through numerous pages of information and abstract the important details was considered an art form.
Today, abstracts include photocopies of pertinent documents. When the abstract has been brought to date, an abstractor will place a “certificate page” at the end of the abstract. This page certifies that the abstract includes all pertinent documents filed in land records, ad valorem tax payment status, personal property tax payment status, and any other court items that fall within the time period covered by the certificate – from the date the abstract was last certified to present.
Yes. Oklahoma requires attorney review of an abstract prior to issuance of title insurance.
Each abstract company has different rates for its services. The cost to update an abstract often depends upon the date to which the abstract was last certified and the county where the property is located. However, some abstractors charge on a per page basis for abstract updates. The cost to build an abstract also varies among the abstract companies within a county. All abstract companies in Oklahoma are required by law to file their abstracting rates with the Oklahoma Abstractors Board (“OAB”). The OAB regulates all costs associated with updating or building an abstract of title in Oklahoma. To see the lists of filed rates for each abstract company in Oklahoma visit http://www.ok.gov/abstractor/. Abstractors are not allowed to charge a price different than the filed rate for an abstracting service.
A title report is a document used by lenders for various reasons, through the most common purpose is to determine the current status of title. A title report includes pertinent information such as the last deed of record stating the present owner’s name; the property’s legal description; and any unreleased liens (e.g., mortgages, judgments, federal and/or state tax liens, and mechanic’s liens).
An insurance policy that protects you (owner’s policy) or your mortgage lender (lender’s policy) against potential problems related to the title of your property.
When any indication of a claim adverse to your title comes up, you should contact your title insurer or the agent who issued your policy. Title insurance includes coverage for legal expenses which may be necessary to settle an adverse claim.
The cost varies, depending mainly on the value of your property. The important thing to remember is that you only pay once. The coverage continues in effect for so long as you have an interest in covered property. If you should die, the coverage automatically continues for the benefit of your heirs. If you sell your property, giving warranties of title to your buyer, your coverage continues on that property but does not pass on or cover the new purchaser. Likewise, if a buyer gives you a mortgage to finance a purchase of covered property from you, your coverage continues to protect your security interest in the property..
The lender’s policy covers only the amount of their loan, which is usually not the full property value. In the event of an adverse claim, the lender would ordinarily not be concerned unless its loan became non-performing and the claim threatened the lender’s ability to foreclose and recover its principal and interest. In the event of a claim there is no provision for payment of legal expenses for an uninsured party. When a loan policy is being issued, the small additional expense of an owner’s policy is a bargain.
- Properly title, date and execute documents including typed names and titles beneath all signatures. Make sure each name and signature is consistent throughout the document.
- Properly acknowledge all documents, including a complete, legible notarial certificate.
- Include the complete legal description of the property.
- Properly reference previously recorded documents when you submit subsequent related documents for recording. This may include document numbers, book and page numbers, and recording dates.
- Include the name and address of preparer and the return-to-address for the document. Also include your telephone number because some jurisdictions will call if they notice a minor, correctable problem.
- Identify schedules and exhibits clearly and number the pages so the recorder can determine that they belong with the document.
- Include the correct fee and applicable transfer tax, mortgage tax, and mortgage certification fee.
- Include a self-addressed stamped envelope to ensure return of the document.
- Check your work, especially for extra fees to make sure your document is complete for recording in order to avoid rejection.
- Include the grantee’s address in any deed to ensure that future ad valorem tax statements are mailed to the proper address.
The cost to record a document in the land records for any county in Oklahoma is $13.00 for the first page and $2.00 for each additional page of the same document. Recording fees are payable to the county clerk in the county in which the documents are being recorded. For help with calculating recording fees, go to our Recording Fees Calculator.
Documentary stamps (transfer taxes) are payable to the county clerk in the county in which the property is located and the deed is filed of record. Documentary stamps are calculated as $0.75 per $500.00 of the sales price. For help with calculating documentary stamps, go to our Documentary Stamps Calculator.
Mortgage tax and the mortgage certification fee are payable to the county treasurer in the county in which the property is located and the mortgage is filed of record. The mortgage certification fee is $5.00. The mortgage certification fee should be added to all calculations of the mortgage tax. For help calculating mortgage taxes, go to our Mortgage Tax Calculator.
Mortgage tax is calculated based upon the term and principal amount of the mortgage as follows:
| If the term of the mortgage is: | the tax is: |
| 5 years or more | $0.10 per $100.00 |
| 4 years but less than 5 years | $0.08 per $100.00 |
| 3 years but less than 4 years | $0.06 per $100.00 |
| 2 years but less than 3 years | $0.04 per $100.00 |
| Less than 2 years | $0.02 per $100.00 |
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