Why do you need title insurance?

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Screen Shot 2015-11-23 at 1.23.14 PMThe majority of homeowners purchase title insurance, but many don’t realize its importance. Title insurance is crucial because it protects the buyer and lender in the event that the seller didn’t have free and clear ownership of the house and property when the sale was made, rendering them unable to transfer full ownership to the buyer.

There are a million possible combinations of problems that could arise in transferring ownership of a property. On the most extreme end of the spectrum, a seller could knowingly try to sell you a home that he or she doesn’t own. Most cases are much less extreme, but can be very complicated. For instance, a seller could have inherited the house under an out-of-date will, with the current will leaving the house to someone else. Or, the seller could have co-purchased the house with someone else, not realizing they would need the second party’s signature to sell. In cases like these, title insurance will come to your rescue, if you purchase it.

Title insurance is usually a combination of two policies: a lender’s policy and a owner’s policy. It is important that when you are purchasing title insurance, you understand the necessity for both. If you are taking out a mortgage, your lender will require you to buy a lender’s policy. The lender’s policy will cover the lender’s legal fees and reimburse them for any mortgage payments you are unable to make because you’ve lost the house to someone else’s claim on it. The owner’s policy will reimburse you for any money you put down on the house or toward other principal payments. Without the owner’s policy your money will be lost.

Infinity Abstract & Title has over 20 years of experience in the title insurance industry. We are proud to serve buyers and real estate agents with our competent and professional services. Please contact us at 813-931-0840 or email us at with any questions you have regarding title insurance. Click Here.