What are the different types of title insurance (e.g. owner's, lender's)?
Title insurance is a type of insurance that protects against losses that may result from defects in the title to a property. There are two main types of title insurance: owner's title insurance and lender's title insurance.
Owner's title insurance: Owner's title insurance is purchased by the buyer of a property and protects their ownership interest in the property. It covers losses that may result from defects in the title, such as liens, encumbrances, or other issues that may affect the buyer's ownership rights.
Lender's title insurance: Lender's title insurance is purchased by the lender and protects their interest in the property. It covers losses that may result from defects in the title that could affect the lender's security in the property, such as liens or encumbrances that were not discovered during the loan process.
Both owner's and lender's title insurance policies typically include a one-time premium that is paid at the time of the real estate transaction. The policies remain in effect as long as the insured party has an ownership interest in the property.
Title insurance is an important protection for both buyers and lenders in real estate transactions, as it helps to ensure that the property is being transferred free and clear of any defects or issues that could affect ownership or security.