What Is an Owner’s Policy in Real Estate?

🏠 What an Owner’s Policy Covers

An owner’s policy provides legal and financial protection from problems that could affect your ownership. Coverage can include:

• Unknown liens or unpaid taxes recorded before you purchased
• Errors or omissions in public records
• Forged or fraudulent signatures on prior documents
• Undisclosed heirs or conflicting ownership claims
• Survey or boundary discrepancies

If a covered issue arises, the title company may defend your ownership in court or reimburse you up to the policy’s value—usually the full purchase price.

🔍 Owner’s Policy vs. Lender’s Policy

Both are forms of title insurance, but they protect different parties:

• The lender’s policy protects the mortgage company’s investment until the loan is paid off.
• The owner’s policy protects your personal ownership rights and equity as long as you hold title to the property.
• Most homeowners purchase an owner’s policy at closing when the Closing Disclosure lists title-related fees.

Learn more about how the lender’s version works here: What Is a Lender’s Policy in Real Estate?

📄 When You Should Have an Owner’s Policy

While not always required, an owner’s policy is strongly recommended for anyone buying real estate. Even after a thorough title search, unexpected issues can surface years later.

Because the cost is a one-time premium paid at closing, it provides long-term peace of mind at a relatively small cost compared to potential legal expenses if a dispute ever occurs.

📋 How It Works With the Title Search

Before issuing any title insurance, the title company performs a detailed title search to verify that the seller has clear ownership and that no outstanding liens or judgments exist.

If problems are discovered after closing that the search missed, your owner’s policy can cover defense costs or financial loss.

📍 Brokerless Guidance

Brokerless encourages every FSBO seller and buyer to understand the protection that title insurance offers. Whether it’s a lender’s or owner’s policy, both stem from the same goal—ensuring a smooth, secure closing process.

Our team works with reputable title companies nationwide to verify that your property is properly insured and that your title remains clear before and after closing.

Protect Your Homeownership with Confidence

Understanding title insurance helps you close with peace of mind. List your property FSBO through Brokerless and get expert guidance from start to finish.