As this Fox New article points out, title insurance may play a larger role in many homeowner’s lives than most of us ever anticipated. With mortgage fraud rampant and the possibility that in the wake of Ibanez foreclosures will be invalidated post-sale, something that once seemed like a formality and perhaps even an unnecessary expense to many home buyers may turn out to be critical–but will those homeowners be protected?
The article warns:
Don’t get confused between the two different types of title insurance. For one, there’s the coverage that your lender gets, which insures that the lender’s interest in the property has priority over claims from any others. That’s not the same as a policy that covers your interest in the property.
If you finance a property, your lender will require that you pay for the lender’s policy. It’s up to you to add an owner’s policy for your own protection.