Lender’s title insurance protects a lender against claims and losses that may arise disputing the ownership of property in court. Homeowners may also purchase title insurance to protect their interests in the property. Unlike many other policies that have annual premiums, this insurance requires only a one-time premium payment. Knowing the price of title insurance will help an individual during the process of comparison shopping.

Before title insurance was developed, the buyer was responsible to ensure that the property title held by the seller was valid. Any fraud or liens on the property would cause the buyer to lose his or her investment. Courts eventually ruled that this was an undue burden to place on buyers and title insurance companies were created. These entities insure purchasers and mortgage companies against losses due to titles that are defective or have liens or other encumbrances on them.

If this coverage is purchased by a property owner, it will pay for the individual to defend against any lawsuits attacking the validity of the title. It will also reimburse the individual for monetary losses up to the maximum amount insured. If a buyer has this insurance, the property closing may proceed even if the title is not clear. The title company assumes the responsibility of clearing the title, while the individual is free to occupy the property.

The current cost of this type of buyer’s insurance is approximately $3.65 per each $1,000 in home value. There are also enhanced policies that pertain to items like incorrect surveys, building encroachments, and building permit violations. Though the premium payment is only made once, the policy provides coverage for as long as the property is owned by the individual and subsequent heirs.

The price of buyer’s title insurance is only several dollars per each thousand dollars of home value and it is made as a one-time payment. This coverage will protect an individual from lawsuits questioning the validity of the title and will provide compensation for losses up to the insured amount. It is a relatively small price for an individual to pay in order to protect his or her property interest.