Why Do Homebuyers Need Owner’s Title Insurance?

why do homebuyers need owner's title insurance

Why Do Homebuyers Need Owner’s Title Insurance

Buying a home is one of the largest investments you will make in your lifetime. There’s nothing quite like owning a home. The process leading up to the final paperwork being signed and the keys being handed over can be exciting but can also be vexing. Which is why we highly recommend investing in owner’s title insurance.

Think about it, you’re already investing in something as important as a home, so why not go the extra mile and protect your investment? Owner’s title insurance gives you the confidence and ease of knowing that you and the purchase of your home are secure. Here are a few reasons why you should consider getting owner’s title insurance.


Chances are you don’t second guess insuring things like your health, your car, life, jewelry, etc., right? Then it makes sense to insure a large purchase like a home. Owner’s title insurance provides protection for your property rights with a one-time fee. This fee usually costs about 0.5% of the home’s purchase price. Which in the grand scheme of things, the purchase of title insurance is worth its weight in gold simply for the peace of mind and protection you receive.


With owner’s title insurance, your property rights as well as those who may inherit the property will be covered in the event of any potential title issues.

Risk Reduction.

With investments, there’s a chance for risk. Purchasing a home could involve some hidden issues that you were not made aware of. Prevent any legal title discrepancies or issues and reduce your risk of title problems by purchasing owner’s title insurance.

According to ALTA (American Land Title Association), some potential and unforeseeable title claims that could appear are the following:

  • Forgery: making a false document
    • For example, the seller misrepresents the identity of the person selling the property.
  • Fraud: deception to achieve unfair gain
    • For example, someone steals your identity and either sells your house without your knowledge or consent, or takes out a second mortgage on the property and walks away with the money.
  • Clerical error: inconsistent paperwork and historical records
    • For example, an unforeseeable discrepancy in the property or fence line causes confusion in ownership rights.

And here is a list of unexpected title claims that could appear:

  • Outstanding mortgages and judgments, or liens against the property because the seller didn’t pay required taxes
  • Pending legal action against the property that could affect your ownership
  • An unknown heir of a previous owner who is claiming ownership of the property

Title Insurance is Incomparable.

While home insurance and warranties protect the inside of your home, owner’s title insurance ensures your property rights are protected.

Owner’s title insurance is not just another ploy to spend money, it’s peace of mind and it’s protection against the unforeseeable and the unexpected when buying a home. In fact, more than 80% of homebuyers in America have purchased owner’s title insurance in order to protect their property rights.