What is title insurance
and do I need it?
Unlike other forms of insurance that focus on possible future events and charge an annual premium, title insurance is purchased for a one-time payment and is a safeguard against loss arising from hazards and defects already existing in the title.
Title insurance protects the bank against mistakes
made in a title search. A title searcher is an
affiliate member, who should be licensed and bonded. They check on details such as making sure there isn't a lien against the title, or that the person you're buying the house from really owns it.
Title insurance usually covers the amount of a mortgage, with the policy's value declining as the mortgage is paid off. The premium is paid once - when the loan is taken out - usually by the borrower. Rates typically are several tenths of a percent of the mortgage amount - often in the 0.4 to 0.7 percent range - or $600 to $1,050 for a $150,000 loan.
|
|
