Is Title Insurance Worth It?

An owner's title insurance is a policy on the deed of your home. It protects you from someone challenging your property ownership because of a circumstance involving a previous owner. With title insurance, you're buying coverage for potential title problems in the past —even if you don't know what they may be at present. The two types of title insurance are the lender's title insurance policy and the owner's insurance policy. Lender's title insurance protects the lender against problems with the title to your property—for example, if someone sues to say that they have a claim against the home. Whereas the owner's title insurance protects an owner from:

· Any disagreement about the property lines

· Disputes about whether the seller had a right to sell the property to you

· Discover undisclosed liens or lawsuits against the property

A lender's title insurance policy is required, and now you're considering an owner's insurance policy. To purchase both types of insurance, you can expect to pay somewhere between $1,000 and $4,000 for title insurance, according to CourtHouseDirect.com. If the title is challenged in court, the title company will provide legal counsel and pay the costs involved in defending your position and resolving the dispute, to the extent of coverage outlined in the policy. If an opposing claim of ownership is determined to be valid, the title company will reimburse you for any covered financial losses, again, up to the policy's limits.

Simply put, the title must be clean, verifying that the seller does own the property and is free to sell it. A home is one of the most significant purchases that you will ever make. The peace of mind that comes with purchasing title insurance is money well spent. Having title insurance can potentially help you to avoid a financial nightmare in the future.

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