What is title insurance?

Title insurance is a contract of defense and indemnification for real estate purchasers and mortgage lenders against issues with the chain of title relating to real property. There may be unknown liens, encumbrances, or other defects on title that existed before your closing. For example, someone may have forged a signature on the deed or there may be outstanding taxes. Title insurance covers the insured party for claims and legal fees that could arise out of problems like these.