Loans By Kathy: FAQ #7 - What is title insurance?

FAQ #7 - What is title insurance?

 FAQ #7 - What is title insurance?


There are two types of title insurance, one is Lender’s title insurance the other is Owner’s title insurance.  Why are they necessary in closing your mortgage transaction?  The lender’s title policy protects the lender in the event of a later discovered defect in the title.  The owner’s title policy will protect your interest in the same event.


The fee associated with the Lender’s title insurance is tied to the loan amount and do vary by state. 


The owner’s title policy is calculated based on the purchase price of the home. 


Now you might be asking what is a title defect? A defect is an unresolved issue that prevents clear marketable title.  Common examples of this would be a spouse that did not sign the deed, other liens against the property or some other interruption in the chain of title.


Unlike other types of insurance premiums, title insurance is a one time premium paid either at closing or within 30 days of closing.


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Kathy Sheehan Senior Loan Officer






Bay Equity LLC

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11475 Great Oaks Way, Suite 350, Alpharetta, GA 30002

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The opinions and general information in this blog are soley those of Kathy Sheehan.  Specifics regarding an individual case should be discussed in detail with a loan professional.  For a confidential consultation, please feel free to contact me via phone or email.  All terms and conditions are subject to change.


Comment balloon 0 commentsKathy Sheehan • June 08 2012 06:35PM