Title Insurance

Title insurance is an insured statement of the condition of “title” or ownership rights to a certain piece of property.

There are two types of title insurance: lender’s title insurance, and owner’s title insurance. A lender’s title insurance policy protects the financial interests of the company that issues the mortgage and establishes that the lender has the top claim on the property above any other liens. Borrowers have to purchase lender’s title insurance any time they take out a mortgage, whether buying a home or refinancing. An owner’s title insurance policy describes the property in detail and insures against certain defects, liens or encumbrances that affect ownership. These are some of the issues an owner’s title policy can protects against:

  • Property survey errors
  • Boundary disputes
  • Errors on the property deed
  • Building code violations by a previous owner
  • Conflicting wills
  • Claims by an ex-spouse who didn’t authorize the sale
  • Claims related to a forged power of attorney
  • Liens from contractors, taxing entities or previous lenders
  • A former owner’s unpaid child support
  • Encroachments
  • Improperly recorded documents

As with many other types of insurance, an owner’s title insurance policy can feel like a waste of money if no adverse claims are made against the title to the property. But the cost of this insurance is a small price to pay to protect the owner’s interests in case anyone challenges the title after closing on the home. Title insurance is a one-time, up-front fee—not an ongoing expense. An owner’s policy is based on the home’s purchase price, while a lender’s policy is based on the loan amount. Buying an owner’s policy at the same time as a lender’s policy can reduce the cost of the owner’s policy through what is called a “simultaneous issue charge.”

To learn more click on the two title services that we most commonly refer: