Title insurance is a form of insurance that protects a purchaser or a lender from a defect in the title of a piece of property that should arise after the transaction is competed (and thus has been paid for by a buyer and/or lender). While owner title insurance is optional, almost all transactions that involve a lender require a lender title insurance policy. An example: say it turns out someone else had a claim to the title or the land you just bought, but the seller has already sold it and is free and clear from responsibility. In this case, title insurance is designed to reimburse any party that's on the losing end of such a dispute, usually up to the purchase price of the property.
Title insurance is most often purchased from a title company.
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