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Do I Really Need Title Insurance?

Purchasing a home is a huge financial and legal endeavor. Homeowners, sellers, buyers, and lenders have the responsibility to ensure that the property belongs to the right party and is free of defects. This is where title insurance comes in.

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You may be asking yourself if you really need title insurance. The short answer? Yes. Title insurance gives you an extra layer of security against fraud and claims.

Title Insurance Protects You & Your Lender Against Errors & Fraud

There are two types of title insurance: lender’s policy, and owner’s policy. These policies protect buyers and lenders against the following on the property title:

  • Errors
  • Omissions
  • Defects
  • Fraud or Forgery
  • Undisclosed Heirs
  • Spousal claims

Title insurance helps lenders and homeowners guarantee a good and marketable title. If a third party makes a claim on the property, title insurance helps provide evidence of a marketable title, along with an abstract of title, certificate of title, and a warranty of title.

If you are getting a mortgage on your home, title insurance is required. If you are selling, title insurance helps assure buyers that the title to your home is good.

Title Insurance Is Paid Upon Closing

If you are concerned about another monthly expense, know that title insurance is often a sum lump paid at closing. Carefully review all closing fees upon closing to ensure accuracy.

Choose Your Title Company Carefully

You have the right to choose the title company that will provide your insurance. Not only will this help prevent confusion with the previous owner, but overpaying. Choosing your own title insurance company will provide you with a clean slate.

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