What is title insurance?
The lender will probably require you (the borrower) to purchase title insurance to protect its interests from potential title problems. Before issuing a title insurance policy, the title company will require the closing attorney to perform a title search to discover any problems with the title to the property. Problems found during the title search (such as unpaid judgments, taxes, mortgages, etc. on the property) must be corrected before closing. For a few dollars more you can also purchase your own title insurance policy to cover you from title problems with the property which may not have been discovered prior to closing. If a problem covered by your policy is discovered after closing, the title insurance company will help clear up the problem or compensate you for any losses you have sustained. Like any insurance policy, there may be exceptions in your coverage, so it is critical that you carefully read your policy and refer any questions to the closing attorney.
Title insurance is an insurance policy which protects you against financial losses should your rights and interests in your property be challenged by someone else s claim of ownership. In addition to insuring you against financial loss, title insurance will also pay the cost of defending you against a covered claim. In the state of Arizona, title insurance is provided to the buyer by the seller of the property. It is a one-time premium that is usually a part of the seller s closing costs.
