Buying a home in East Lansing or anywhere in Michigan? Learn what title insurance covers, why it's important, how the title process works, and how title insurance protects your ownership rights long after closing.
Buying a home involves much more than finding the right property and negotiating an offer. Behind every successful closing is a process designed to protect your ownership rights, and one of the most important parts of that process is title insurance.
One of the questions I hear most often from buyers is, "Do I really need title insurance?" The answer is yes. While most transactions close without issues, title insurance protects you from problems that may have existed long before you purchased the home. It provides peace of mind that your ownership rights are protected if an unexpected title issue surfaces after closing.
Whether you're purchasing your first home, relocating to East Lansing, or investing in real estate, understanding title insurance before closing helps you make more informed decisions.
If you're just beginning your home-buying journey, I also recommend reading my First-Time Homebuyer's Guide To Buying A Home In Greater Lansing, which walks through every step of the process from pre-approval to closing.
What Is Title Insurance?
Unlike homeowner's insurance, which protects your home from future events like fire, storms, or theft, title insurance protects you against problems that occurred before you became the owner.
These issues often involve the property's legal ownership history rather than the physical condition of the home.
An owner's title insurance policy provides financial protection and legal defense if a covered title issue appears after closing.
Because the policy is purchased with a one-time premium at closing, your coverage remains in effect for as long as you or your heirs own the property. That long-term protection makes title insurance one of the most valuable parts of the closing process.
Owner's Policy vs. Lender's Policy
Many buyers don't realize there are actually two different title insurance policies involved in a real estate transaction.
Owner's Policy
An owner's policy:
- Protects your ownership rights
- Protects the equity you've built in your home
- Provides legal defense if a covered title claim arises
- Covers losses up to the policy limits
Lender's Policy
A lender's policy:
- Protects the mortgage lender
- Covers only the remaining loan balance
- Declines as the mortgage is paid down
- Does not protect your personal ownership interest
One of the biggest misconceptions I hear is that because the lender requires title insurance, the buyer is automatically protected. That's not the case. The lender's policy protects the lender—not the homeowner. If you want protection for your own investment, you'll typically want an owner's policy as well.
Understanding title insurance is just one part of protecting yourself during a real estate transaction. It's equally important to understand how your earnest money deposit works throughout the inspection and contingency period. My Earnest Money In Michigan: What Home Buyers Should Know guide explains exactly what every buyer should know before making an offer.
Why Title Insurance Matters
Although serious title problems aren't common, they can happen.
Examples include:
- Previously undisclosed liens
- Recording errors
- Clerical mistakes
- Missing signatures
- Unknown heirs
- Boundary disputes
- Easements affecting property use
- Fraud involving prior ownership
Without title insurance, resolving these issues could become expensive and time-consuming.
Fortunately, most title issues are identified before closing during the title search process, allowing them to be resolved before ownership transfers.
How the Title Process Works
Once your purchase agreement is accepted, the title company begins researching the property's legal history.
This process typically includes:
Title Search
The title company reviews public records to identify:
- Current ownership
- Mortgages
- Liens
- Easements
- Restrictive covenants
- Judgments
- Legal descriptions
- Prior transfers
After completing its research, the title company issues a preliminary title commitment explaining what must be addressed before closing.
Clearing Title Issues
If issues are discovered, the title company works with the parties involved to resolve them before ownership transfers.
Common examples include:
- Paying off existing mortgages
- Releasing tax liens
- Correcting legal descriptions
- Recording missing documents
- Obtaining required signatures
- Resolving probate matters
Most title concerns are resolved before closing so buyers receive clear ownership.
One of my responsibilities as your REALTOR® is helping coordinate communication between the title company, lender, seller, and everyone else involved in the transaction. My goal is to identify potential issues early so they don't delay your closing.
Closing Day
Once title requirements have been satisfied, closing can move forward.
On closing day:
- Closing documents are signed.
- Funds are distributed.
- Existing mortgages are paid off.
- The deed is prepared for recording.
- The mortgage is recorded if financing is involved.
After recording with the Ingham County Register of Deeds, the title company issues the final owner's policy and lender's policy.
At that point, you officially become the property's legal owner.
If you're preparing to purchase a home, my Looking For A Single-Family Home For Sale In Greater Lansing, MI? guide explains how to evaluate homes, inspections, and long-term ownership costs before moving forward.
Common Title Problems
Some of the more common issues uncovered during a title search include:
- Unreleased mortgages
- Tax liens
- Judgment liens
- Missing signatures
- Unknown heirs
- Boundary disputes
- Easement questions
- Errors in legal descriptions
- Recording mistakes
Fortunately, title companies resolve most of these issues before closing ever occurs.
While buyers rarely see everything happening behind the scenes, a tremendous amount of work takes place before closing to ensure ownership transfers correctly. That's one of the reasons I always recommend working with experienced professionals throughout the transaction.
What Title Insurance Does Not Cover
Like every insurance policy, title insurance includes certain exclusions and exceptions.
Understanding those limitations before closing helps you know exactly what your policy protects.
Common exclusions may include:
- Problems created after your policy is issued
- Issues specifically listed as exceptions in the title commitment
- Certain zoning or land-use violations
- Some boundary disputes when no current survey has been completed
- Matters not covered by optional endorsements
Your title company will review your title commitment before closing so you understand any exceptions that remain with the property.
One thing I always encourage buyers to do is ask questions if something in the title commitment doesn't make sense. Closing documents contain a lot of legal terminology, and you should never feel uncomfortable asking for clarification before signing.
Understanding Title Insurance Costs
Title insurance is a one-time closing expense rather than an ongoing monthly payment.
Depending on your transaction, closing costs may include:
- Owner's title insurance premium
- Lender's title insurance premium
- Title search and examination fees
- Settlement or closing fees
- Recording fees
- Wire fees
- State transfer taxes
- Escrow deposits for taxes and insurance
Who pays for each item varies depending on your purchase agreement and local customs.
Sometimes the seller pays for the owner's policy.
Sometimes the buyer pays.
In other transactions, certain costs are negotiated between both parties.
One of the things I review with buyers before closing is the Closing Disclosure so there are no surprises. Knowing what each fee represents helps buyers feel much more comfortable as they approach closing day.
Endorsements and Surveys
Some buyers choose to purchase additional title insurance endorsements that provide expanded coverage for certain situations.
Examples include:
- Survey endorsements
- Access endorsements
- Zoning endorsements
- Condominium endorsements
The right endorsements depend on the property you're purchasing.
A current land survey can also uncover potential encroachments or boundary concerns before closing, allowing those issues to be addressed early whenever possible.
A Simple Buyer Checklist
Before making an offer:
- Ask about known title concerns.
- Request any existing surveys.
- Review permits for recent improvements.
After your offer is accepted:
- Order the title commitment promptly.
- Review exceptions with your REALTOR®.
- Ask questions about anything you don't understand.
- Request estimates for title insurance costs.
Before closing:
- Review your Closing Disclosure carefully.
- Confirm who is responsible for each closing cost.
- Verify recording fees and transfer taxes.
- Ask when your owner's title policy will be issued.
Following these simple steps can make the title process much smoother and help avoid unnecessary surprises.
If you're relocating from another city or state, understanding the local buying process ahead of time can make your transition much smoother. My Relocating to East Lansing: A Neighborhood Decision Guide offers practical advice for buyers making the move to Mid-Michigan.
How Giguere Estates Helps
One of my goals is making every part of the buying process feel less overwhelming.
Before becoming a REALTOR®, I spent more than a decade working in custom home construction, where attention to detail was essential. Today, I bring that same mindset to every real estate transaction.
From the moment your offer is accepted, I help coordinate with lenders, title companies, inspectors, attorneys, and the seller's agent to keep your transaction moving toward a successful closing.
If questions arise during the title process, I'm there to help explain what they mean, communicate with the appropriate professionals, and keep you informed every step of the way.
Buying a home should feel exciting—not confusing.
Whether you're purchasing your first home, relocating, or buying an investment property, my goal is to help you understand every step of the transaction so you can move forward with confidence.
Final Thoughts
Title insurance may not be the most exciting part of buying a home, but it's one of the most important.
For a one-time premium paid at closing, an owner's title insurance policy helps protect your ownership rights long after you've received the keys.
Understanding how the title process works, reviewing your title commitment carefully, and working with experienced professionals can help ensure your closing goes smoothly and your investment remains protected.
Whether you're buying your first home, relocating to East Lansing, or purchasing an investment property, I'd love the opportunity to guide you through every step of the process.
Continue Exploring Greater Lansing
If you're preparing to purchase a home, these additional buyer guides may help:
- First-Time Homebuyer's Guide To Buying A Home In Greater Lansing
- Earnest Money In Michigan: What Home Buyers Should Know
- Looking For A Single-Family Home For Sale In Greater Lansing, MI?
- Relocating to East Lansing: A Neighborhood Decision Guide
- Buying a Duplex in Lansing: Live-In Rental Basics
About The Author
Nicole Giguere is a REALTOR® with Giguere Estates, PLLC and a member of the Seguin-Sprague Team at RE/MAX Real Estate Professionals. Before becoming a REALTOR®, Nicole spent more than a decade working in custom home construction, giving her a unique understanding of contracts, property evaluation, construction quality, and every stage of the home-buying process.
Today, she helps buyers and sellers throughout Greater Lansing and Mid-Michigan navigate every stage of a real estate transaction with confidence. Whether you're purchasing your first home, relocating, investing, or building a custom home, Nicole is committed to providing honest guidance, local expertise, and a personalized real estate experience from beginning to end.
If you're ready to BUILD • BUY • SELL in Greater Lansing or Mid-Michigan, Nicole would love the opportunity to help.
Nicole Giguere, REALTOR®
Giguere Estates, PLLC | Seguin-Sprague Team
RE/MAX Real Estate Professionals
📍 1755 Abbey Road, East Lansing, MI 48823
📞 (517) 242-0619
BUILD • BUY • SELL
