What is Title Insurance Pt 2 (Lenders vs. Owners)

In this video Deirdre P Brown explains the difference between lenders and owners title insurance.


Hello this is Deirdre Brown your settlement agent serving DC, Maryland and Virginia. Today we're going to talk about title insurance.  What is title insurance? There are two types of title insurance.  There is lender's title insurance and owner's title insurance.

Lender's s title insurance is required if you have a loan.  So whether you have a private loan or a loan with a financial institution you' will be required to purchase lender's title insurance. Lenders title insurance covers the lender up to the loan amount if there's ever a successful claim against title. A successful claim against title may be something like an unrecorded lien or a long-lost heir that wasn't found in the title search process.

Owner's title insurance is optional but it is highly recommended because it covers the owner's interest in the property. There are two types of owner's  title insurance - standard and enhanced. Standard owner's title insurance covers the lender up to the purchase amount if there's a successful claim against title. If you have the enhanced policy it may cover you up to the market value on the day of the claim. This is why it's important that as an owner you purchase title insurance.

If you have more title related questions please feel free to reach out to me at closewithdee.com