Title Insurance

Definition

Title insurance protects against losses arising from undisclosed liens, unrecorded easements, boundary disputes, forged deeds, and other defects in the chain of title. Unlike most insurance, title insurance is paid as a one-time premium at close and remains in force for as long as the insured owns the property (owner's policy) or the lender holds the loan (lender's policy). Premiums run 0.3–0.6% of purchase price in most US markets. Title insurance is non-negotiable on lender-financed deals — every lender requires a lender's policy.

Worked example

On a $300,000 purchase, an owner's title insurance policy typically runs $1,000–1,800 and a lender's policy $500–900. The title company performs a title search before issuing — finding and curing title defects (cleared liens, signed releases, quiet title actions) is a separate fee called 'title cure' or 'closing protection letter.'

How DealIntel uses it

DealIntel's kill list checks for title-defect red flags surfaced in public records — open mechanic's liens, recorded easements, lis pendens, tax delinquencies. Properties with curable defects pass with a note; properties with non-curable issues (e.g., a clouded chain back 40+ years on a tax-foreclosed property) are flagged Pass.

Related terms

• Closing CostsTransaction costs paid at acquisition and at sale — typically 2–4% on the buy side and 5–7% on the sell side.
• EscrowA neutral third-party arrangement that holds funds, documents, or property until contractual conditions are met.

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