Let Me Tell You a Quick Story…

Not that long ago, one of my buyers went under contract on what was marketed as a single, spacious property—two lots, bundled together. Everything was smooth sailing… until the title company called with news that stopped us in our tracks.

Turns out, the seller didn’t actually own part of the land.

Years ago, when they bought the property, the paperwork wasn’t properly filled out. One portion was never recorded—meaning legally, it still belonged to someone else. The seller had no idea. Neither did the listing agent. My client was just a week from closing.

We could’ve lost the whole deal.

But we didn’t. With a sharp-eyed escrow officer, a committed team, and a whole lot of follow-through, we got the documents corrected, transferred, and filed. A decade-long error—fixed. My buyer got their dream home, fully theirs.

And this? This is why I never let clients skip title review, and why I’ll always fight for the right protections. Peace of mind doesn’t come from luck—it comes from the details.

What Is an Owner Title Policy? (And Why Should You Care?)

Here’s the simple version: an Owner Title Policy is an insurance policy that protects your rights to the home you’re buying.

It covers surprises that pop up after you close—things like:

• A long-lost heir showing up claiming the house is theirs

• Forged signatures on old deeds

• Mistakes in public records

• Hidden liens from a previous owner

You pay for it once, and it protects you for as long as you own the home.

If you’re selling, offering this policy shows the buyer you’ve got their back—and that builds trust.

Buyers: Don’t Skip It—Here’s Why

When you buy a home, you want to own it free and clear. No drama. No legal disputes. No bills from someone else’s mess.

An Owner Title Policy does three big things:

1. It Protects You From the Unexpected

Even the best title searches miss things. This policy steps in when something old and ugly tries to resurface.

2. It Saves You From Paying Hidden Costs

Say an old lien gets discovered—without this policy, you might have to pay it. With the policy, you’re covered.

3. It Buys You Peace of Mind

Real estate is stressful enough. Knowing you’re protected? Worth every penny.

Sellers: This Isn’t Just About Buyers

You might be thinking, “This sounds like a buyer’s thing.” But hear me out—it’s your deal, too.

Here’s how a title policy can help you sell faster, cleaner, and smarter:

1. It Builds Buyer Confidence

For a buyer, the Owner Title Policy provides assurance that a previous owner, family member, or vendor isn’t going to come after them and that the property has transferred ownership free of any liens, encumbrances or vested interests. 

2. It Speeds Up Closing

Title issues can delay or kill a sale. If your buyer knows they're covered, they’re more likely to stick with the deal.

3. It Reduces Legal Risk

If something surfaces after closing the buyer can make a claim on the Owner Title Policy and have the full force of attorneys without all of the cost. 

What You Need to Watch Out For

Whether you're buying or selling, a few key things deserve your attention:

1. A Title Search Isn't Enough

Think of the title search like a flashlight. It only shows what’s currently visible. But there could still be things hiding in the dark.

2. Coverage Varies

Not all policies are created equal. Be sure to check the title commitments. 

3. Who Pays?

This varies by state, negotiation, and what kind of market you are in. Ask your agent (or ask me—I’ll tell you straight).

4. Fees Add Up

You can ask the title company for a list of the fees you can expect during a transaction, or your Realtor can also provide you with an estimate of fees and net proceeds.

Tanya’s Real-World Tips for Smooth Closings

Here’s how I coach my clients through it:

• Negotiate early: Decide who pays for the title policy and if there will be endorsements to the policy..

• Ask about reissue rates: If the seller bought recently, the buyer might get a discount.

• Bundle when possible: Lender’s and owner’s policies are often cheaper together.

• Don’t just go with the listing agent’s buddy: Do your homework on the title company or ask your Realtor for recommendations. 

Related Articles on My Site

• 10 Hidden Costs to Watch for When Selling Your Home

• The Ultimate Seller’s Checklist Before You List

• How to Avoid Buyer Cold Feet at Closing

Trusted Outside Resources

• ALTA (American Land Title Association)

• Consumer Finance Protection Bureau – Title Insurance Basics

Quick Recap

A strong Owner Title Policy gives buyers peace of mind and sellers a smoother transaction. It protects everyone from mistakes in the public record, old debts, and unexpected claims. Yes, it’s optional—but in my professional opinion? It’s a no-brainer.

TL;DR

An Owner Title Policy protects homebuyers from legal issues tied to a property's past. For sellers, it helps avoid delays and adds trust to the deal. It’s a one-time cost that can prevent hidden fees and save your sale.

Top 10 FAQs

1. What’s the difference between owner’s and lender’s title insurance?

Lender’s insurance protects the bank. Owner’s insurance protects you.

2. Do I really need this?

If you don’t like legal battles or surprise bills, yes—you really do.

3. How much does it cost?

In Texas, it’s a percentage of the sales price and is regulated by the Texas Department of Insurance (TDI).

4. Is it required?

Not necessarily, but most agents (like me) strongly recommend it. If you’re purchasing cash, it’s up to you whether you want it. 

5. Who pays?

Depends on your state and your contract. Ask your agent or look up local norms.

6. Does it last forever?

Yes—for as long as you own the home.

7. What does it actually cover?

Liens, errors, fraud, and other ownership disputes from the past.

8. What does it not cover?

Future zoning issues or things that happen after closing.

9. Can I pick my own title company?

Yes, but, that’s a negotiation that occurs within the offer process. 

10. What if I’m buying new construction?

You still need it—issues can arise from the land or previous owners.