What is Owner’s Title Insurance?
Owner’s title insurance is a one-time purchase at the time of closing that protects your ownership interest in your home and real property for as long as you or your heirs own the home. Both the standard and enhanced owner’s title insurance policies protect you against claims made by prior owners, creditors, and neighboring properties. The enhanced also protects you from issues as future title fraud and future encroachments. As a buyer, you may be required to purchase a loan title insurance policy for the lender. However, a lender’s title insurance policy offers no protection to you as the buyer.
How Owner’s Title Insurance Works
As property transfers, mistakes and irregularities often made long before you own the property, and possibly outside the scope of the title exam, can place your ownership interest in dispute. Other issues can arise, that even the closing attorney may not be aware of such as:
- Recent unpaid loans or advances that the seller fails to disclose and that does not appear in the real estate records;
- Fraudulent or forged deeds in the chain of title; and/or
- Claims by sellers to be the only owner.
If ownership of your property ever comes into question, the one -time investment by purchasing an owner’s title insurance policy protects you from legal problems that could result in the loss of your home.
Please see this chart that outlines some of the matters your owner’s title insurance policy may cover.