Title Insurance
Quick Summary
Insurance that protects against certain title defects, fraud, or legal issues affecting ownership.
ELI5 Explanation
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It helps protect you (and the lender) from problems tied to the property’s title.
Detailed Explanation
Title insurance is commonly purchased at closing and can cover issues like title fraud, errors in public records, encroachments, or unknown liens (depending on policy). It does not replace legal advice, but it can reduce risk and cost if a covered issue is discovered later.
Example
After closing, a title issue is found and the title insurance policy helps cover legal costs to resolve it.
Why It Matters
It’s a common closing cost that can protect against rare but expensive problems.