Curious about title insurance and the closing process? Our FAQ page answers common questions about title searches, insurance coverage, refinancing, and legal protections. Whether you’re buying, selling, or refinancing, we break down each step to help you understand your rights and responsibilities with clarity and confidence.
What does title insurance protect me against legally?
Forgery, liens on the property, undisclosed heirs, fraud, and mistakes in legal documents
What are the steps in issuing a title insurance policy?
- Step 1: A title search is ordered
The buyer’s attorney will place an order for title insurance with a title company. The title company will then initiate a title search to find any mortgages, deeds, easements, rights or restrictions, liens, or other land records that affect the property’s title. - Step 2: A title search is performed
A title insurance company will analyze the documents and records and evaluate their impact on the title to the property. - Step 3: A tile commitment is issued
After many examinations of the public records, a title commitment is prepared as the company’s agreement to insure the title on the property while also detailing the amount of insurance, exceptions, and requirements for the final policy to be issued. - Step 4: Title defects are cleared by the seller
If any title defects are identified then the title officer will collaborate with sellers, buyers, lenders, and their attorneys to resolve any issues. - Step 5: Closing and premium payment
The borrower/buyer pays the premium at the closing. The closing will most likely take place at the office of the attorney or title company.
Who pays for title insurance?
Potential homebuyers typically cover the expenses for the lender’s title insurance policy, which is mandatory for most lenders. This cost is commonly part of the closing expenses when buying a home. Homebuyers also have the option to buy owner’s title insurance for their protection. Occasionally, sellers may offer to pay for owner’s title insurance to encourage potential buyers further. The regulations concerning who pays for owner’s title insurance can vary by state.
What is a title search?
A title search is a thorough investigation of a property’s historical records. These include deeds and court documents to ensure the seller has the right to sell and to uncover any issues, like claims or defects, that might affect the property’s ownership.
Why do I have to purchase title insurance for the bank again when refinancing my home?
The title insurance you initially purchased was meant to protect the bank that lent you the money from anything that has occurred in the past. However the insurance you purchase when you refinance protects the bank from the date you last refinanced to the present. A “reissue rate” will be applied when you refinance to discount the premium lower than your initial payment.
