To protect possibly the most important
investment you'll ever make - the investment in real estate.
A lender goes to great lengths to minimize the risk of lending money for
the purchase of real estate. First, credit is checked as an
indication of the borrower's ability to repay the loan.
Then, the lender seeks assurance that the quality of the title to the
property to be acquired and which will be pledged as security for the loan
is satisfactory. The lender does this by obtaining a loan policy of title
Policy Does Not Protect The Borrower
The loan policy protects the lender against
loss due to unknown title defects. It also protects the lender's interest
from certain matters which may exist, but may not be known at the time of
But, this policy only protects the lender's interest. It does not protect
the borrower. That is why a real estate purchaser needs an owner's policy,
which can be issued at the same time as the loan policy, usually for a
nominal one-time fee.
Title Insurance Protects Against