Quick answer
Lender’s title insurance protects the lender’s financial interest in the property and is usually required for a mortgage. Owner’s title insurance is a separate policy that can protect the buyer’s ownership interest from certain covered title defects. Neither policy guarantees that every ownership dispute is covered, so compare the commitment, exceptions, limits and final policy—not only the premium.
What each title policy protects
A title search reviews public records for issues such as recorded liens, ownership transfers and other claims. Title insurance addresses certain covered problems that existed before the policy date but were not resolved or discovered as expected. The two common policies protect different parties.
| Question | Lender’s policy | Owner’s policy |
|---|---|---|
| Who is insured? | The mortgage lender | The named homeowner or owners |
| What interest is protected? | The lender’s secured loan interest | The buyer’s covered ownership interest |
| Is it normally required? | Usually, when a mortgage is used | Often optional, depending on the transaction and location |
| How long can protection last? | Generally while the insured loan remains in place | According to the policy while the insured retains a covered interest |
The Consumer Financial Protection Bureau emphasizes that a lender’s policy does not protect the buyer’s equity. Ask the settlement or title provider to identify the insured party on each quoted policy and explain what changes after a refinance.
How title insurance costs work
Title insurance is commonly paid as a one-time premium at or before closing rather than as a monthly charge. Pricing and who customarily pays vary by state, local practice, property value, insurer and policy type. A simultaneous owner-and-lender policy may be priced differently from two policies purchased separately.
Find the quoted charges on the Loan Estimate and later on the Closing Disclosure. Compare the service description, policy type and provider—not just a line labeled “title.” Title search, settlement, closing, recording and title-policy charges can appear as separate items. Use the Loan Estimate versus Closing Disclosure guide to match the figures before signing.
If a refinance requires a new lender’s policy, ask whether a reissue or refinance rate is available and what documentation is required. Do not assume an existing owner’s policy automatically disappears or expands; read its terms and ask the issuing company.
Documents and exceptions to review
The title commitment or preliminary report is not the final insurance policy. It typically identifies the proposed insured, proposed amount, requirements that must be satisfied before issuing coverage and exceptions that will not be insured. Review it early enough to resolve questions before closing.
- Verify the legal names of all buyers and the property’s legal description.
- Ask which liens, easements, restrictions or survey matters are listed as exceptions.
- Confirm which requirements must be cleared before the policy can be issued.
- Ask whether a current survey changes any exceptions.
- Keep the final signed policy with the deed and closing documents.
Title insurance is not a substitute for a survey, inspection, legal review or careful reading of deed restrictions. Each answers a different question.
Questions for the title company
- Which quote is for the lender’s policy and which is for the owner’s policy?
- Who is the named insured, and what is the policy amount?
- Which exceptions are specific to this property?
- Are enhanced or expanded owner-policy options available, and what do they change?
- Does the quote include a simultaneous-issue or reissue discount?
- When will the final policy be delivered, and whom should I contact if it does not arrive?
Frequently asked questions
Does lender’s title insurance protect my down payment?
No. It protects the lender’s covered interest, not the homeowner’s equity. An owner’s policy is the policy intended to protect the buyer’s covered ownership interest.
Is owner’s title insurance always required?
It is often optional, while a lender commonly requires its own policy. Contract terms and local practices differ, so confirm the transaction-specific requirements.
Can I shop for title services?
Some title and settlement services may be shoppable. Review the provider list and Loan Estimate, and ask whether changing providers affects timing or bundled pricing.
Sources
- CFPB: What is lender’s title insurance?
- CFPB: Loan Estimate explainer
- American Land Title Association: Consumer information
Sources were checked on July 28, 2026. Policy terms, lending practices, product availability, prices and state or local requirements can change.