Someone broke into Johns car. He had copies of his tax returns, and financial and other personal information in his car, but nothing appeared to be taken from the car. Months later, his lender, which had a mortgage on his home, returned his payments, stating that his loan had been paid off. John discovered that unbeknownst to him and without his consent, someone had signed his name to a deed, purporting to convey title to his property to a Jane Doe for $300,000, and that Jane Doe had obtained two loans which totaled $300,000 from an institutional lender. John had never heard of Jane Doe, had not appeared before the notary public who purportedly witnessed his signature on the deed, and knew nothing about the sale to Jane Doe.
Shocked, he reported the incident to the local police. He next called the title company, North American, that had handled his purchase. Much to his relief, he learned that the title company would take care of the whole problem and get his house back from Jane Doe. He had purchased an ALTA Homeowners Policy that provided coverage for loss of his property due to forgery while he owned it. The title company sued Jane Doe, successfully cleared Johns title from the forged deed, and paid off Jane Does lenders, who had not been receiving any mortgage payments and threatening foreclosure, without delay. Without title insurance, John would have had to battle Jane Doe and her lenders to save his home on his own at great personal expense.