Title Insurance

A title insurance Owner's Policy is typically purchased by or for the Buyer in order to safeguard against any title problem that may arise after the sale -- for example, a dispute involving someone else claiming partial ownership of the property. With an Owner's Policy, the new owner will be able to rely on the title insurance company to address any expensive legal problems that may arise, and to pay for any actual damages suffered by the Buyer.

Assuming the Buyer is borrowing money from a lending institution in order to make the purchase, the Lender’s Policy will be required to insure the mortgage lender that there are no encumbrances against the property. If it turns out that a prior valid lien exists when the house is later sold, the Lender's Policy will reimburse the lender the full amount of what is owed.

The Escrow/Closing Agent will typically handle it or be able to recommend a reliable company. Who pays for the various policies of title insurance vary depending on regional custom, and is ultimately negotiable. The cost of title insurance is part of closing costs and responsibility to pay or divide these costs should be agreed to in the Contract.