You’ve heard of title insurance, but did you know there are two different kinds? Lender’s title insurance serves one purpose, and owner’s title insurance is different. It can be challenging to understand what title insurance is needed and who pays for it.

Fortunately, a little bit of research can save you time and money. Knowing the differences will help you ensure that everything is covered and that you don’t pay for anything you don’t need to.

Owner’s Title Insurance

Owner’s title insurance protects your interest in the property. Once you buy the property, you need to guard against any problems with the title.

What can happen? Here are a few issues that can cost you money or even your home:

  • Clerical errors
  • Missed records
  • Undisclosed heirs
  • Omissions
  • Unknown liens
  • Fraud involving the deed

Before an insurance company issues owner’s title insurance, they thoroughly investigate the title history of the home. They work to ensure that nothing is wrong. Once they issue the coverage, it will help protect you against a variety of issues that can come up even after the most thorough title check.

This insurance is optional, but it is worth the cost to get the peace of mind knowing both you and your heirs are protected. The protection also extends if you convert the property to an estate planning trust. Owner’s coverage also protects against issues that happen after the purchase, such as forgery of a mortgage due to identity theft.

Lender’s Title Insurance

In most cases, the buyer pays for the lender’s title insurance. This policy offers the same protections as a buyer’s policy, but it protects the lender rather than the new owner.

The lender will require that they receive this policy before they approve the loan for the home purchase.

Banks understand how important it is to protect their interest in your home, even if there is a title mistake or discrepancy. As the buyer, your interest is equally important. Be sure to completely protect yourself by getting both types of title insurance when you buy a home. If there are issues in the future, you’ll be glad you did! Ready to be setup with appropriate coverage? Contact us today!

Real Estate Closing Solutions, an Orlando title insurance agency, offers a complete range of title insurance and escrow closing services supported by the financial strength of multiple national title underwriters. Our Orlando title insurance agency was founded on the belief that buyers, sellers, Realtors, lenders and builders desire and deserve reliable real estate resources and flexibility and certainty in scheduling the time and location for their real estate closings.