Owner’s title insurance is a vital consideration when purchasing real estate. It provides the buyer with protection against disputes, defects and claims to the property’s title.

Title disputes can occur for a variety of reasons – outstanding debt tied to the property, unknown heirs or conflicting wills, to name but a few. Title insurance will cover you for claims, losses and legal fees related to title defects that have arisen due to events that occurred before you bought the property. Please visit our ‘What Is Title Insurance?’ blog for further general information regarding title insurance. 

Lender’s vs. owner’s title insurance: what’s the difference?

You’ll probably have heard both of these terms being mentioned at some point during the buying process, but what do they mean? The clue is in the name – lender’s title insurance covers the mortgage lender, whereas owner’s title insurance covers the buyer. Both policies will generally offer a similar type of coverage against title dispute claims and losses; the difference between them is whom the policy protects. 

Is owner’s title insurance mandatory?

Whilst it’s not compulsory for buyers to take out owner’s title insurance, it is strongly recommended. Claims or title issues can crop up at any time, even after you’ve owned the property for several years, and without owner’s title insurance you’ll have no financial protection and will be responsible for rectifying these issues yourself. 

Lender’s insurance, on the other hand, is usually essential. The majority of lenders won’t grant a mortgage request without you taking out appropriate lender’s insurance. But remember – lender’s insurance won’t protect you!

How much is owner’s title insurance?

Owner’s title insurance is taken as a one-off payment at the closing stage, which then covers you for as long as you own the property. The cost of title insurance depends on various factors, such as the property price and the state that the property resides in, but it generally tends to be a small percentage of the price you’re paying for the property. For personalized calculations, please take advantage of our free rate calculator, which will give you a rough idea of the potential title insurance costs related specifically to your type of real estate purchase. And if you’d like further support regarding taking owner’s title insurance, please don’t hesitate to get in touch with Larry – a highly experienced and committed policy issuing agent specializing in title insurance in New York City.