What are the two most common types of title insurance?


What are the two most common types of title insurance?

Imagine that you are in escrow on your dream home. Everything is going smoothly and you can’t believe your luck…until you find out that there is a title error that will cost you thousands to correct in order for the sale to move forward. Or worse, imagine that you close on that dream home, move in, paint the walls, only to find out that there’s a challenge to the ownership of the property that wasn’t discovered during your title search. Now what?!

Title insurance exists for moments exactly like these. While certainly a nightmare, and usually uncommon, the fact is that these exact scenarios become reality for some home buyers. Protect yourself, your investment and your future with title insurance. If an issue is unearthed before or after closing, title insurance will cover valid claims and the legal fees associated with clearing the title. Title insurance has a one-time premium, paid at closing, that will protect you for as long as you own the home. There are 2 types of title insurance available.

Lender’s Policy

A lender’s policy is usually required by your mortgage company as a term of your loan. Sometimes it is called a loan policy, but both names represent the same type of title insurance: one that protects your lender’s financial investment in your property. At the end of the day, your lender wants to know that they will receive their money (and interest) back in its entirety. If there is a challenge to the ownership of the property, for example, there is the risk that the loan will not be completed and paid off. A lender’s policy guarantees that the mortgage company receives all their money back in the event of a title issue.

Owner’s Policy

An owner’s policy protects you, the owner, in the event that a problem with the title comes up. While not required as a stipulation of your loan, your home can have an owner’s title insurance policy concurrently with a lender’s policy. Why purchase an owner’s policy when there’s already title insurance? Should something happen, you get paid out too. An owner’s policy protects your ownership rights if a claim to ownership arises after closing. It also covers title issues from before your purchase (and in some cases, after). Holding an owner’s policy protects your equity in the property.

Need a quote for title insurance? At Clear Title, LLC, our specialty is title work. With decades of experience, we look forward to offering you a free title insurance quote. To get started, call one of our conveniently located Pensacola locations.

Pensacola: (850) 361-4029

Pace: (850) 994-3838

Pine Forest: (850) 202-8518

Our Locations

Pace Location

4636 Summerdale Drive
Pace, Florida 32571

Pensacola Location

127 Palafox Pl Suite 200
Pensacola, Florida 32502

Pine Forest Location

2107 W 9 Mile Rd, #3
Pensacola, Florida 32534

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