This is where I believe it gets complicated. The developer bought a large tract of land and then divided into a large number of lots. If there was a problem with the title of the large tract of land then presumably every lot has a problem. At that point, there is presumably a large legal problem because potentially thousands of lot would be involved. Presumably there would be a large class action law suite. I did not buy title insurance on my new house because I don't believe there is much chance of that happening. On a resale, there could be a number of issues with the title that someone missed (liens, problems with a will, divorce issues, etc.) and therefore title insurance makes more sense. Essentially, I am betting that the developer's purchase of the large tract of land that contains my new home was done cleanly because there was so much at stake. Perhaps I am naive - time will tell.
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Originally Posted by JohnN
It's a scam on new homes, there's no past title on a vacant lot.
Existing homes seem to need it
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