What is title insurance?
Title insurance, sometimes referred to as title policy, protects the named insured against loss because of defects, liens, encumbrances, adverse claims, or other matters not shown or disclosed to the new owner that attach before the date of the policy. Title insurance may be paid for the buyer or seller, but is usually paid for by the seller.
Title insurance is a contract to protect you as the owner against losses arising through defects in the title to real estate owned. If the title is insurable, the company guarantees the owner against loss due to any defect in title or expenses in legal defense of the title pursuant to the terms of the policy.
A. Title Insurance is a policy that protects against any disputes over ownership of the property. Lender’s title insurance covers the lender if there are any questions about ownership or liens against the property. Owner’s title insurance protects the owner. Title insurance is paid as a one-time fee at closing.
In short, title insurance is an insurance policy that protects the lender against defects in the title. This insurance will pay the lender in the event there are flaws in the title, such as inadequate surveys, misrepresentation or fraud. The lender would not be left holding the property, and subsequently paying on the property or having another owner take the property with no compensation to the lender (or the owner). Back to the top Owner’s Title Insurance will protect you against these hidden risks which would not be disclosed by even the most meticulous search of public records. Lender’s title insurance protects the Lender if one of these things happens. YOU, if you don’t have owner’s title insurance, are left with NOTHING. Many title mistakes are made during real estate transactions, either because someone was careless, deceitful or uninformed. Title insurance protects your investment. This one time investment is much less costly than trying to settle a problem down the road.
Fact: — Purchased with a one-time fee at closing, title insurance protects owners in the event that title to the property is found to be invalid. Coverage includes “lenders” policies, which protect buyers up to the mortgage value of the property, and “owners” coverage, which protects owners up to the purchase price. In other words, “owners” coverage protects both the mortgage amount and the value of the down payment.
