When buying a home in Minneapolis, there are many factors to consider. They can be how much you are willing to pay, what features you want, where you want the house to be, or what reality you want to get a realtor from. While these are all important, it is also important to ask what are the previous owners of the homes like. They could have unpaid taxes, a legal dispute that has yet to be settled, or undisclosed deeds that will fall on you once you purchase the house. Title insurance exists to protect you and your lender from these potential expenses, but is it required to have?
Lender’s title insurance
When taking out a loan for the new home, the lender will most likely have a policy about insurance on the money that they lend to you, which is called lender’s title insurance. For the lender, it is an investment that they could lose without insurance if something were to happen. Each lender has their own way of finding insurance. That means different lenders will have different policies regarding their lender’s title insurance.
Owner’s title insurance
Owner’s title insurance comes from a title company and is granted to you, the buyer, to protect the money that they have put into the home. While it is not required by law, it can be required by contract. A buyer should insist on an owner’s policy when buying a home to protect this big step. In Minnesota, owner’s title insurance lasts as long as you or your heirs own the property and can protect you from various claims depending on the policy you choose.
Should I get owner’s title insurance
Even though it is not required, owner’s title insurance can protect you and your money if an undisclosed expense claim threatened your investment in your new home. These expenses include liens, building permit violations, property line errors, and encroachment. With owner’s title insurance, the costs for court or settlement is covered by your policy.
If you are considering buying a new home, contact Twin City Title for any title insurance questions. We are happy to help you make your dream of a new home come true.