Making Title Insurance Easy to Understand for the First-Time Buyer

Buying your first home should be a thrilling experience. And while it is an exciting time, it's likely to be a pretty overwhelming process all around, and for good reason. Your home is quite possibly the largest investment you'll make in your lifetime, so you'll want to be confident that all aspects of the process are handled correctly. Buying a title insurance policy is an important way to protect your investment. As your trusted Lake of the Ozarks title agency, we're here to help familiarize you with the process.


How Title Insurance Works

As its name suggests, title insurance insures your title. That is, it insures your right to use and occupy your land, as your title legally allows you to do.

Whereas other types of insurance (home, auto, etc) protects against issues that may happen in the future, title insurance guards against issues that may have already occurred but are yet undiscovered. Examples of these types of issues include:
  • Mistakes in public records
  • Forged or unauthorized signatures in the sale
  • Unpaid liens against the property
  • Unknown easements allowing another party access to part of the property
  • Unknown heirs who claim legal ownership of the property
  • A separated (but not legally divorced) spouse who claims ownership over a home that the other spouse sold

If these (or other) previously undiscovered issues presents, your right to use and occupy the property you purchased may severely limited or compromised. Depending on the situation, a title claim may result in anything from financial loss to loss of the property itself.

Title insurance is your first line of defense against these types of hazards that may threaten your right to ownership of your property.

Owner's Policies vs Lender's Policies

Title insurance comes in two primary forms: owner's title policies and lender's title policies. The lender's policy protects the lender in the event that you were to default on your loan. If you obtain a mortgage to buy your home, you will be required to purchase this policy to protect your lender.

The owner's policy protects you, the property owner, from the types of hazards we discussed above. The lender's policy will not offer you this type of direct protection. Though purchasing an owner's policy is optional, we strongly encourage you to get one. 

Title insurance policies are purchased for a low one-time premium. The cost of the policy will be factored into your closing costs, which in some cases may be rolled into the total amount of your loan (depending on the type of loan you qualify for). Unlike other types of insurance, the upfront purchase of your policy will be the only time you are required to pay for your policy. Once purchased, your policy will remain in effect for as long as you or your heirs have a vested interest in the property. Its one-time premium makes title insurance one of the most affordable types of insurance currently on the market.

Arrowhead Title, Inc. Is Your Title Resource!

If you are buying a house in the Lake Area, we hope you'll consider Arrowhead Title, Inc. to provide your title insurance at the Lake of the Ozarks. Having been in business since 1984, we have helped hundreds of buyers protect the greatest investment of their lives. We would be honored to put our experience and expertise to work for you. 

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