What does title insurance insure?
Title insurance offers protection against claims resulting from various defects (as set out in the policy) which may exist in the title to a specific parcel of real property, effective on the issue date of the policy. For example, a person might claim to have a deed or lease giving them ownership or the right to possess your property. Another person could claim to hold an easement giving them a right of access across your land. Yet another person may claim that they have a lien on your property securing the repayment of a debt. That property may be an empty lot or it may hold a 50-story office tower. Title companies work with all types of real property. Two kinds of title insurance benefit you in two ways: Lender or mortgagee Title Insurance Policy: Most lenders require mortgagee title insurance as security for their investment in real estate, just as they may call for fire insurance and other types of coverage as investor protection. When title insurance is provided, lenders are willi
Title Insurance offers protection against claims resulting from various defects (as set out in the policy) that may exist in the title to a specific parcel of real property, effective on the issue date of the policy. For example, a person might claim to have a deed or lease giving them ownership or the right to possess your property. Another person could claim to hold an easement giving them a right of access across your land. Yet another person may claim that they have a lien on your property securing the repayment of a debt. That property may be an empty lot or it may hold a 50-story office tower. Title companies work with all types or real property. What Type of Policies Are Available? Title companies routinely issue two types of policies: An “owner’s” policy which insures you, the home buyer for as long as you and your heirs own the home; and a “lenders” policy which insures the priority of the lender’s security interest over the claims that others may have in the property. What Pr
Title insurance offers protection against claims resulting from various defects (as set out in the policy) which may exist in the title to a specific parcel of real property, effective on the issue date of the policy. For example, a person might claim to have a deed or lease giving them ownership or the right to possess your property. Another person could claim to hold an easement giving them a right of access across your land. Yet another person may claim that they have a lien on your property securing the repayment of a debt. That property may be an empty lot or it may hold a 50-story office tower. Title companies work with all types of real property. What types of policies are available? Title companies routinely issue two types of policies: An “owner’s” policy which insures you, the Homebuyer for as long as you and your heirs own the home; and a “lender’s” policy which insures the priority of the lender’s security interest over the claims that others may have in the property. What
A. Title insurance offers protection against claims resulting from various defects (as set out in the policy) which may exist in the title to a specific parcel of real property effective on the issue date of the policy. For example, a person might claim to have a deed or lease giving them ownership or the right to possess your property. Another person could claim to hold an easement giving them a right of access across your land. Yet another person may claim that they have a lien on your property securing the repayment of a debt. That property may be an empty lot or it may hold a 50-story office tower. Title companies work with all types of real property.
The exact answer depends on whether you are a mortgage lender or a property buyer. Lender’s title insurance offers more extensive coverage, such as for water rights, zoning and conditions obvious from a property inspection, such as an unrecorded, overhead-power-line easement. But a property owner’s coverage is less complete unless the buyer purchases “extended coverage,” which is virtually the same as a lender’s title policy. Both coverages include protection for title risks, such as forged signatures in the chain of title (the major cause of title losses), encroachments, surveys (if specifically included), recorded easements, mechanics’ liens, property tax liens, claims by heirs and ex-spouses, title search errors, and many others. WHO PAYS THE TITLE INSURANCE PREMIUM? The answer to this question depends on local custom and the terms of the property purchase contract. For example, in the county where I live, the custom is the buyer pays for the lender’s title insurance and, if desired
