If you recently purchased a home, you may be considering title insurance. Title insurance protects you from taking a financial downfall triggered by property ownership issues. Believe it or not, someone may have a legal right to the home you live in. Is title insurance worth it? Let’s take a closer look into it.
What is Title Insurance?
Title insurance is a form of indemnity insurance that protects lenders and homebuyers from financial loss sustained from defects in a property title. The most common type of title insurance is lender’s title insurance, which the borrower purchases to protect the lender. The other type is owner’s title insurance, which the seller often pays to protect the buyer’s property equity. Title insurance is typically paid with a one-time premium at closing and has no monthly payment. Mortgage lenders require title insurance to close on the purchase of a home.
Some owner’s policies will offer extended coverage. These protect against building permit violations, zoning law violations, or even structural damages. If someone sues you due to a title problem, the policy will cover any legal costs. These costs usually include your down payment, principal payments, or the cost of any improvements you’ve made to your home.
Is Title Insurance Worth it?
Well, it depends on certain factors. Title insurance may go into effect if something that happened in the past resurfaces. It may be worth it if your home is older. How much you pay for title insurance will vary based on where you live and the policy itself. On average, an owner’s title insurance policy costs about one thousand dollars. Although it depends on how much your home costs, title insurance could run anywhere from a few hundred to several thousand dollars. It may be worth it to grant yourself peace of mind.
Contact Us Today
Buying a home will be the most significant and most fulfilling investment you’ll ever make. It is always helpful to choose a title company to assist you in the process. A title company will make an effort to validate that the buyer receives the property’s title legitimately by assuring all documents are in order before the transaction is complete. They confirm that the seller has the right to sell the property to the buyer. In addition to this, a title company will issue title insurance and facilitate the closing. Are you looking for a title company to help you with your closing? We can help! Give us a call today to learn more!