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Debunking Common Myths About Title Insurance

Any real estate transaction should have title insurance. However, there are widespread myths and misunderstandings concerning this crucial insurance coverage. In this post, we'll dispel some of the most widespread misconceptions about title insurance and explain why it's essential to both lenders and homebuyers as protection.

Myth 1: You don't need title insurance

The notion that title insurance is not essential is among the most common fallacies regarding it. Some consumers think they don't need title insurance since they've previously performed a title search or perhaps the current owner has owned the property for several years and they believe their title is lien free. A title search is not, however, error-free. It could expose some flaws with the title, but not necessarily all of them.

On the other side, title insurance shields you against unanticipated problems that can appear following the title search. For instance, a title insurance policy may cover situations like hidden heirs, fraud, or forgeries. It may also include flaws like inaccurate legal descriptions, liens, or encumbrances not noted in public records. Simply put, title insurance gives you peace of mind since you know you are safeguarded against any unanticipated problems with your title.

Myth 2: Only the lender is protected by title insurance

Another widespread misconception regarding title insurance is that it exclusively defends the lender. Although the lender's title insurance coverage does safeguard the lender's interest in the property, it does not safeguard the interest of the buyer. It is advised that purchasers get their own owner's title insurance coverage because of this.The buyer is shielded from any title problems that could surface following the purchase by an owner's title insurance policy. This might involve problems like unreported liens, forged deeds, or easements. If any of these problems were to occur, a buyer may suffer a large financial loss without an owner's title insurance coverage.

Myth 3: The cost of title insurance is expensive

The idea that title insurance is excessively expensive is another prevalent myth. In contrast to the value of the covered property, title insurance is comparatively inexpensive. Title  insurance is paid for with a one-time premium at closing.

Additionally, the price of title insurance may differ based on the area and the value of the property. The price of title insurance is established under the guidelines of the insurance commissioner in each state.    No matter how much it may cost, title insurance is a tiny amount to pay for the security and assurance it offers.

Myth 4: Title insurance is an annual renewal expense.

Another widespread misconception regarding title insurance is that it is an ongoing expense. The insurance coverage is valid for as long as you hold the property, but it does not extend to any subsequent sales. For instance, your bank will require you  to buy a new lender's title insurance coverage if you refinance your mortgage as that lender policy will protect your lender.  The new owner of your property will also need to get their own title insurance coverage if you decide to sell it.


For all real estate transactions, title insurance is a crucial layer of security. It gives you peace of mind, guards against unanticipated problems, and makes sure you're completely covered against any possible damages. You may choose wisely when it comes to getting title insurance for your home if you are aware of these widespread misunderstandings and falsehoods.

If you're in the process of buying or refinancing a home, make sure to protect yourself with title insurance. At Skyway Title Services, LLC, we provide comprehensive title insurance coverage to both lenders and homebuyers. Contact us today to learn more and to get the peace of mind you deserve.


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