Title Insurance
Insurance that covers loss of an interest in a property due to legal defects and that is required if the property has a mortgage. Most title insurance is lender's title insurance, which is paid for by the borrower but protects only the lender.
Owner's title insurance is a separate policy, in some areas paid for by the seller, to protect the buyer's equity in the property. Investopedia Says:
While a lender's policy only protects the lender against loss, the fact that the policy was issued reflects that a title search has taken place, which can give some assurance to the buyer. However, title searches are not 100% infallible, hence the need for insurance. Related Terms:
Closing Costs
Cloud On Title
No-Cost Mortgage
Title
Title Search |