What is Title Insurance?

Title insurance serves a very important purpose in a real estate transaction. Unlike car or life insurance which protects and covers events that occur in the future, title insurance protects and covers buyers and lenders from financial losses that arise from defects or disputes that happened in the past that are not known at the time of transfer of property ownership.

A title company’s job is to search local land records for any liens, conflicts or encumbrances that need to be cleared before the transfer of property from one party to another. Title insurance protects the owner’s and lender’s interest in the property in the event of fraudulent deeds of trust releases, incorrectly filed or lost deeds or unknown heirs to the property. In the event a claim has to be filed, your title insurance policy would pay for damages and the cost associated with curing the title issue.

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