Title insurance is one of the most important forms of insurance for homeowners. It protects them from losses arising from defects in the title to their home. Title insurance covers the lender for the full loan amount in case of a foreclosure, and it also covers the homeowner for any claims that may arise from the ownership of the property.
There are two types of title insurance: owner’s title insurance and lender’s title insurance. As the name suggests, owner’s title insurance protects the buyer (or owner) of a home, while lender’s title insurance protects the lender in case there are any issues with the title of the home.
New Jersey title company for lender’s title insurance is usually required by the lender when you take out a mortgage. This type of insurance protects the lender in case there are any problems with the title of the home, such as if someone else claims ownership of the home or if there are outstanding liens against the property. If there are any problems with the title, the lender’s title insurance policy will pay to resolve them.
Owner’s title insurance is not required by lenders, but it is strongly recommended that you purchase an owner’s policy when you buy a home. This type of insurance protects you from any problems with the title of the home, such as if someone else claims ownership of the home or if there are outstanding liens against the property.
If there are any problems with the title, your owner’s title insurance policy will pay to resolve them. You can purchase an owner’s policy at the same time you purchase a home. There could be a dispute over the boundaries of the property. If this dispute is not resolved, you could be stuck paying for costly legal fees and survey costs. Title insurance would protect you from having to pay for these costs.
