Title insurance is an insurance policy you buy from a title insurance company when you buy a home or property. It protects you and your lender from loss if a property ownership dispute occurs. The title insurance company searches public records, such as liens, claims, deeds, tax records and maps, to make sure there are no problems in the title’s ownership and history for the property you are buying.
The fee for title insurance is usually included in your itemization of closing costs from your lender, and it is a one-time fee. The terms of the policy define covered and excluded losses if a problem should occur at a later date. The policy takes effect on the issue date and covers title defects that arise prior to your ownership. By law, your lender must deliver your policy to you within a reasonable time after it is issued.