What title insurance does
When you buy a home, a title company searches public records to make sure the seller can legally transfer it and that there are no hidden claims. Title insurance protects against problems that search didn't find, such as an old lien, a recording error or a forged signature in the home's history.
Unlike most insurance, it looks backward. It covers issues that existed before you bought the home. If a covered claim comes up later, the title insurer can pay to defend your ownership in court and cover your loss, up to the policy amount.
The two policies
- Lender's policy: protects the lender's interest in the home, up to the loan amount. Lenders typically require it on a mortgage.
- Owner's policy: protects you, up to the purchase price. It is optional in most cases but recommended, because it protects your equity.
Problems title insurance has caught
- A contractor's lien from a past owner
- A missing signature on an old deed
- An heir who claims part of the home
- Forged documents in the chain of title
- A clerical error in public records
Who pays
Who pays for each policy depends on local custom and your purchase contract. In some areas the seller usually pays for the owner's policy, and in others the buyer does. Rules vary by state, so your agent can tell you what is typical where you are buying.
With ZERO Closing Costs
CapCenter's ZERO Closing Costs (restrictions apply) includes paying for lender's and owner's title insurance when required and provided by our approved agent. The title search fee and settlement agent fee are covered the same way. See Offer details for the full terms.
Escrow deposits, prepaid interest and government recording fees aren't part of ZERO Closing Costs. Your Loan Estimate shows what you will still pay. If you also buy with CapCenter's Realty Team, the Realty Purchase Credit of up to 0.5% of the purchase price, where we offer realty services, requires using our preferred title and settlement agent too.
A cost example
Hypothetical example. On a $400,000 purchase, an owner's title policy might run from about $1,000 to $2,500, depending on the state and the title company. Prices are often set by state rules or rate filings, so they can vary widely. With ZERO Closing Costs, CapCenter pays it when provided by our approved agent.
