When you're buying a home, title insurance might seem like just another item on the closing checklist. But tucked inside that policy are exceptions—specific limitations that can affect your ownership rights. Understanding these exceptions isn’t just a technical detail; it’s a key part of protecting your investment and your future plans.

Title insurance is designed to shield homeowners and lenders from financial loss due to defects in the property’s title. These defects might include things like forged documents, undisclosed heirs, unpaid liens, or errors in public records. However, title insurance doesn’t cover everything. That’s where exceptions come in.

Exceptions are listed in the title commitment, typically under Schedule B. They outline what the policy does not cover. Common examples include utility easements, HOA restrictions, mineral rights, setback requirements, and existing liens or encroachments. These exceptions define the boundaries of your coverage and can have real-world implications.

For instance, an easement might prevent you from building a pool or adding a fence where you planned. HOA rules could restrict short-term rentals or exterior modifications. Mineral rights might mean someone else has the legal ability to drill beneath your land. These aren’t just abstract legal concepts—they can directly impact how you use and enjoy your property.

Beyond usage, exceptions can influence resale value. A shared driveway or unresolved boundary issue might deter future buyers or complicate financing. Exceptions can also reveal hidden risks, such as unpaid taxes or zoning conflicts, that weren’t obvious during your walkthrough.

Understanding exceptions empowers you to ask better questions. You can work with your title company or attorney to clarify what each exception means, determine whether it can be removed, and assess whether it affects your plans. In some cases, exceptions can be cured or cleared. A new survey might resolve a boundary concern. A lien could be paid off before closing. An outdated restriction might be legally removed. But these solutions only happen when you know what to look for.

For buyers and agents alike, it’s wise to request a copy of the title commitment early in the transaction. Reviewing Schedule B with care allows you to spot potential issues before they become problems. Ask what each exception means, whether it can be insured over, and how it might affect your intended use of the property.

Title insurance is a powerful tool, but it’s only as effective as your understanding of its limits. By taking the time to review exceptions, you protect your purchase, your plans, and your peace of mind. Whether you’re buying your first home or your fifth investment property, don’t overlook the fine print. It’s not just paperwork—it’s protection.

Make your next move with confidence—LEAD Realty Group is here to empower you with the knowledge that makes smart decisions simple.