Homeowner's insurance is an insurance policy that protects the property buyer from any defects in title. Before a title company issues a policy, they do a title search to find out about the history of the property. They look for liens or judgements filed against the property, delinquent taxes (property, IRS or state) and they make sure that the seller is the true owner of the property. If they find defects, they take care of them during escrow and pay whatever is due before the property changes hands. This search is done a couple of times before recording the new deed of trust.
In a way title insurance is similar to car insurance in that auto insurance protects the buyer against future incidents where title insurance protects the buyer against past incidents.
A lender's title insurance policy protects the bank or other lending institution that issues your mortgage from any losses resulting from disputes over who owns the property.
This policy covers the amount of the loan and the cost is based on the amount of that loan. Most lenders require this coverage, which ends when the mortgage is paid.
An owner's title insurance policy guarantees that the buyer has the right to the property. It usually covers the cost of any legal fees that arise if you have to defend your claim. The cost is based on the price of the property.
Title insurance is issued for a one-time fee usually due when you are closing or settling the real estate transaction. Insurance benefits are paid only to the name that is on the policy. Coverage lasts as long as you hold title to the property.
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In a way title insurance is similar to car insurance in that auto insurance protects the buyer against future incidents where title insurance protects the buyer against past incidents.
A lender's title insurance policy protects the bank or other lending institution that issues your mortgage from any losses resulting from disputes over who owns the property.
This policy covers the amount of the loan and the cost is based on the amount of that loan. Most lenders require this coverage, which ends when the mortgage is paid.
An owner's title insurance policy guarantees that the buyer has the right to the property. It usually covers the cost of any legal fees that arise if you have to defend your claim. The cost is based on the price of the property.
Title insurance is issued for a one-time fee usually due when you are closing or settling the real estate transaction. Insurance benefits are paid only to the name that is on the policy. Coverage lasts as long as you hold title to the property.
This article may also help you.
What is Title Insurance?