What is Title Insurance?

We have been asked on several occasions ‘How does title insurance differ from other types of insurance?’ If this question has been on your mind possibly this will help!

Title insurance is different from other types of insurance in that it protects you, the insured, from a loss that may occur from matters or faults from the past. Other types of insurance such as auto, life or health cover you against losses that may occur in the future. Title insurance does not protect against any future faults.

Another difference is that you pay a one-time premium. A title insurance policy will protect you from risks or undiscovered interests, such as liens, in the property that you are considering to purchase.

There are two principal forms of title insurance:

· The Lender's Policy: A lender's policy protects the mortgage holder. If there is a fault in title that results in a loss, the mortgage holder will be paid back.

· The Homeowner's Policy or Buyer's Policy: A homeowner's policy protects you, the purchaser, against a loss that may occur from a fault in your ownership or interest you have in the property. You should protect the equity in your new home with a title policy.

What does a Homeowner's Policy provide? It provides protection from financial loss, due to demands that may be charged against the title to your home, up to the cost of the title policy. Payments of legal costs are provided, if the title insurer has to defend your title against a covered claim. Payments of successful claims are provided against the title to your home covered by the policy, up to the cost of the policy.

How long does your coverage last? Once purchased, title insurance remains in effect for as long as you own your property. Title insurance adds security and peace of mind to home ownership.

How do you obtain title insurance and what does it cost? Let the Title Company, attorney or agent handling the closing of your property know that you want to purchase an Owner's Title Insurance Policy. When choosing a title insurer, you should look for a company with experience, as well as the financial strength to protect you. In most states, the insurance commission or some other governmental body controls the premiums for title insurance policies. You only pay the premium once. The cost depends upon the purchase price of the property, and your policy amount must be equal to the purchase price.

Please feel free to contact us at anytime! We look forward to hearing from you and helping you determine the best Loan Program and the Best Rate available! If you or someone you know is in need of a mortgage home loan we would love the opportunity to provide a good faith estimate and discuss what options are available to you.