Lender’s Policy – If you have ever taken out a mortgage on your home it is likely that the lender required you to purchase a title insurance policy. Then lender’s policy is also known as a loan policy and most lending institutions require it as a way to insure their security interest in the property. The policy protects the lender for as long as the loan is outstanding.

Owner’s Policy – As a buyer, you also want to protect your investment and your ownership rights in your property. That is why you should purchase an owner’s policy of title insurance.  This will protect your rights as the homeowner for as long as you or your heirs have an interest in the property.

Both of these title insurance policies pay valid claims along with the legal fees to defend against hidden title issues. They also help to decrease ownership risks by providing a thorough title search prior to the issuance of either policy.

Refinance Transactions – If you are refinancing your property you may be surprised to see that you are required to purchase a new lender’s policy of title insurance. This is because a lender’s policy only provides coverage for the life of a loan. When a home is refinanced that previous loan is paid off and the policy ends. Therefore, a new lender’s policy will be required. Because your owner’s policy provides coverage for as long as you own your home and additionally to your heirs, there is no need to purchase a new owner’s policy when refinancing