Why does the lender have to have a new lenders title insurance policy everytime I do a transaction?
Lender’s title insurance policies insure the lender’s interest in the property up to the face amount of their loan. The policy is only applicable to the specific transaction, and it provides coverage for the mortgage lien and it protects against errors made in the title search connected with that transaction, as well as any pre-existing clouds on title. Therefore, each new lender will want a lender’s policy that is specific to their transaction. Why do you need to buy title insurance again even though you purchased a policy when you first bought your home and there is no change in ownership? It is because a separate policy is needed by the lender insuring the vaidity of your mortgage when it is made. For as long as you own the property your mortgage is valid, but it doesn’t insure the new mortgage created when you refinance, and it doesn’t provide protection against events that may have transpired between the time you purchased the property and when it is refinanced. For example, you m
Related Questions
- What type of approval does a lender need to originate and/or underwrite and/or service Title II Single Family Loans, including HECMs (Reverse Mortgages) or 203k (Rehabilitation mortgages)?
- Why does the lender have to have a new lenders title insurance policy everytime I do a transaction?
- What is the difference between Title I and Title II lender approvals?
