As you are likely aware, when you own your property, there is a title. The title is proof that you own the property. Title insurance is great protection to anyone who may try to claim ownership. There are two different types of title insurance – lender’s title insurance and owner’s title insurance. Lender’s title insurance is required – it protects your mortgage lender’s financial stake. Owner’s title insurance is optional – it protects your financial stake. Even though the owner’s title insurance is optional, it is still highly recommended. It is quite possible that having owner’s title insurance can protect you greatly.
Title insurance protects both homeowners and mortgage lenders from any potential financial losses that may come up. Title insurance can covering unknown liens, omitted heirs, mistakes in the public record, or even fraud
The cost for title insurance varies. – it can be from $300 up to more than $2,000 The price will fluctuate based on the value of the property and where the home is located. On a positive note, title insurance is not a recurring payment but a one-time payment that is made at the closing.
The chance of you actually needing to use the title insurance is slim – but it could definitely happen. At the event you do need to use it, it would save you quite a lot of money – legal fees included.
Most people do not realize it, but if you decide to refinance your home, you will need to purchase a new lender’s title insurance policy. This even holds true if you decide to use the same lender. Also, title insurance does not transfer to a new homeowner.
Another positive about the process Is that you have complete control over who you decide to use as the title insurance company.