People often have questions about the merits of obtaining title insurance when they buy a new home. Today, I’m pleased to have guest columnist and real estate attorney Ali Alavi of Alavi + Braza, P.C. with us to explain the importance of title insurance.
Here are a few key takeaways from the conversation:
The lender’s title insurance provides no protection to the homeowner. “If you're buying a home, you will need to decide whether or not to purchase an owner’s policy of title insurance that protects your interests in the property,” said Ali Alavi. “This is one of the most important decisions you will have to make with respect to the purchase of your home. Unfortunately while you, the buyer, must pay to purchase the lender’s title insurance policy, the lender’s title insurance policy only protects the lender and offers no protection to you. At the closing, however, you will be given the opportunity to pay a one-time premium to obtain owner’s title insurance, which does benefit you, and your heirs, for as long as you have an interest in the property.”