What could be insured by Standard Title Insurance policy?

Answer 1

Two types of title insurance coverage: 1. Mortgage Policy - Covers the Primary Lender for the life of the loan. As the loan is paid down, the coverage goes down with it. When the loan is paid off (either through life of loan payments or refinance) the Policy is no longer in affect. 2. Owner's Policy - Covers the new owner for the history and prior owner acts affecting the property. Owner's Policy is in effect for as long as the new, current owner owns the property 1 year or 100 years. Acts of new owner after issuance are not covered, only prior owner acts at time of purchase. Since each property is unique, the coverage is unique to the property. "Standard" coverage insures the history of the property If a issue creates a cloud on title (marketability, loanability,etc.), that will be shown on the title report along with requirements needed to address the cloud (tax sales, old mortgages,etc). If an issue cannot be removed from title, the buyer has the option of not purchasing the property or accepting it with the known defect and the title agency will "except" that defect from coverage ie: not insure it. Title insurance is non-transferrable. If you sell the property, you cannot transfer your Policy to the new owner. A Lender, however, can usually assign the Loan Policy coverage to an assign or purchasor of the loan if they have purchased Secondary Market coverage at the time the Policy was issed and the original terms, conditions and original loan amount has not changed as part of the purchase of the loan.