Q: What is title insurance?
A: Title insurance is protection against loss arising from problems that may result in a claim against ownership of your property. Title insurance is your safeguard to help pay valid claims and cover the costs of defending an attack on your title.
Q: Why do I need title insurance?
A: When you purchase your home, you want it to be free of debt or obligations not created by you. Title insurance protects you, the buyer, against loss from past claims or disputes over ownership of property.
Q: Am I required to purchase title insurance?
A: All mortgage lenders require a Lender's Policy (also known as a Loan Policy) in an amount equal to the initial loan balance. In the event of a title problem, this type of policy protects the lender's interest in the property as security for the mortgage. The policy lasts until the loan is repaid. This type of policy does not protect the property owner.
Q: Can I purchase title insurance to protect my ownership interest in the property?
A: Yes. This type of policy is called an Owner's (or Homeowner's) Policy and is issued for the amount of the home's purchase price. To obtain this coverage, you pay a one-time premium at closing. The policy lasts forever. This type of policy protects property owners and their heirs by providing protection against attacks on the property's title.
Q: What are some common title problems covered by title insurance?
A: A title insurance policy covers risks such as:
Q: How much does title insurance cost?
A: The cost of title insurance varies depending on the policy amount and the type of coverage you select. The average premium for maximum title protection is $4.68 per $1,000 of coverage. However, if the property has been previously insured through Fidelity National Title Insurance Company, you may be eligible for a discount. |
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