Title insurance always covers the lender; get coverage for yourself, too. The title insurer will commission a survey to confirm that the legal parameters of the property are correct. Sometimes, a property line is incorrectly recorded and your yard might include some of your neighbor's yard, or vice versa. Sorting out disputed lot lines is time consuming and contentious. It is better to get such issues corrected before you buy the property. The title insurer will research the ownership history to confirm that the seller actually owns the property and can legally sell it to you. Complications are rare, but when they occur, they can take years to resolve. Title insurance protects the lender - which does not want collateral that it can't cash in on. You can also get title insurance that protects you, the owner. Request "gap insurance", which covers claims against the property that were in the bureaucratic pipeline while your deal was in process. Gap insurance covers you if a contractor shows up claiming that the prior owners haven't paid for, say, the new roof they put on before selling the house. Contractors have the right to put a lien on your house for unpaid bills. Gap insurance protects you from bills left unpaid by the sellers. Your lender will require property insurance - again, to protect its interest in your property. Decide if you want insurance to cover the purchase price or replacement cost of the property. Also set a value on the possessions that will be protected by the house. If the house burns down, your furniture is unlikely to escape. Expect to update your property insurance as you improve the property, increasing its value, and acquire more valuable possessions.
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