HOW MUCH? - home title insurance

Understanding title insurance.


Purchasing a home means that you are paying for the right to occupy and use the property. Provided you are doing so within the town and cities code policies, that right is legally binding. Filing a title with the Registrar of Deeds or the County Courthouse means that you now own the property. You may however run into challenges to your ownership if there are liens placed against the title.

Challenges to Ownership

Prior owners, creditors of prior owners, those who worked on the property and others are free to challenge your ownership. You might be wondering how this is possible. It is actually very simple. If the prior owner had any outstanding obligations that resulted in non-payment there may have been liens placed on the property.

Protecting Yourself With Title Insurance

A buyer's title insurance policy can help protect you. Title insurance is protection against a "defect" in the title. Prior liens count as defects. A defect is anything that offers a third party the right to say that they might be a part owner in the property that you believe you own. Protecting your right to the property is inexpensive and easy to do.

You can protect yourself by purchasing a buyer's title policy. This can help save you hundreds or even thousands of dollars. You would be required to defend yourself if any title defects were challenged. Some property owners have found themselves in the position of losing the property (be it home or land) because they could not successfully defend themselves.

What Does a Buyer's Policy Protect Me From?

A title insurance policy is meant to help you clear up any title defects. Title insurance companies will handle litigating issues and will reimburse the owner for losses. Title insurance is paid in a one-time premium and as long as you or your survivors own the property, the policy is in effect.

The title insurance company would help secure your right to the property. They will handle all of the litigation against any claims. In the event that fighting a claim incurs expenses, the insurance company will pay those expenses.

Homeowner Title Insurance
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Are There Other Types of Policies?

Yes. Your lender has protected themselves from a loss as well. This policy is called a Lender's Title Insurance Policy. These policies are taken out by lenders on all mortgages issued whether they are for buying a home or refinancing a home.

If The Lender Has a Policy Why Do I Need One?

Simple - the Lender's Title Insurance Policy protects the lender. It does not protect you. A lender's policy is designed to protect the lender from liens on the policy that affect their lien position.

Do I Need a Policy If I Am Building a Home?

Yes! Very simply, someone who worked on your home could place a lien on it. There is a possibility that the person you purchased the land from might have used the land as collateral on another loan. Other possibilities include issues with easements that could be placed against the title.


Title Insurance protects you from loss. The small cost of a title insurance policy can save you hundreds or even thousands of dollars. Your lender is going to be protected against title problems, you should be protected as well.

Related topics: homeowner insurance company, home insurance premiums, private mortgage insurance




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