Short answer: a lender’s title insurance policy protects the lender against problems with the title to the home, and an owner’s policy can protect you. On the Loan Estimate and Closing Disclosure, the lender’s policy is listed with the loan costs, while an owner’s policy the lender does not require is listed under “Other” and marked “(optional).” In a home purchase with a federally related mortgage loan, a seller may not require you to buy title insurance from a particular title company. Title insurance rates vary depending on where you buy. This page covers federal law only; other rules may apply where you live. It is general information, not legal or financial advice.
Owner’s vs lender’s title insurance
The CFPB says title insurance can protect you if someone later sues and says they have a claim against the home from before you bought it, such as from a previous owner’s unpaid taxes or contractors who say they were not paid (CFPB: owner’s title insurance, last reviewed October 19, 2023, read October 30, 2026; this page may be out of date). It says a lender’s policy protects only the lender and does not protect your equity, and that it is generally required to get a mortgage (CFPB: lender’s title insurance, last reviewed September 11, 2024; this page may be out of date).
| Item | Lender’s policy | Owner’s policy |
|---|---|---|
| Who it protects | The lender, for the amount of its loan | You, the buyer |
| Required by the lender? | The CFPB says it is generally required for a mortgage | Optional unless the lender requires it |
| Loan Estimate | Loan Costs: Services You Cannot Shop For or Services You Can Shop For, with a label starting “Title” (12 CFR 1026.37(f)(2)-(3)) | Other Costs: Other, with a label starting “Title” and ending “(optional)” (1026.37(g)(4)) |
| Closing Disclosure | Loan Costs: Services Borrower Did Not Shop For or Did Shop For (1026.38(f)(2)-(3)) | Other Costs: Other, with a label starting “Title” and ending “(optional)” if you pay it (1026.38(g)(4)) |
Sources: 12 CFR 1026.37 (eCFR) and 1026.38 (eCFR), text up to date as of October 28, 2026, read October 30, 2026. The official comments say an owner’s policy that covers you and is not required by the lender is shown only under 1026.37(g), and that the lender’s premium is shown at its full rate (Supplement I, comment 37(f)(2)-4, eCFR). The owner’s amount on the Loan Estimate is based on a basic owner’s policy rate, not an “enhanced” policy, unless the sales contract requires an enhanced policy and the lender knows that (comment 37(g)(4)-1).
Why the title numbers may not match the title company’s
When you buy both policies at once, a discounted rate for issuing them together may be available. The official comments say the lender’s premium is shown at the full rate, and the owner’s premium is shown as the full owner’s premium, plus the simultaneous-issue premium for the lender’s coverage, minus the full lender’s premium (comments 37(g)(4)-2 and 38(g)(4)-2). So each line can differ from the title company’s own paperwork while the total is the same.
This example is only for the math, with example premiums, not rates for any title company or place.
| Item | Example |
|---|---|
| Full owner’s premium | $1,200 |
| Simultaneous-issue premium for the lender’s coverage | $150 |
| Full lender’s premium (shown in Loan Costs) | $900 |
| Owner’s premium shown in Other: $1,200 + $150 − $900 | $450 |
| Total of the two lines: $900 + $450 | $1,350 |
| What the title company charges: $1,200 + $150 | $1,350 |
The CFPB says that if you add up all the title-related costs your title company gives you, they should match the title-related totals on the Loan Estimate or Closing Disclosure, and that you should compare the bottom-line total (CFPB: title premium differences, last reviewed August 9, 2024; this page may be out of date).
Shopping for title services
If the lender lets you pick the provider of a settlement service, it must say so on the Loan Estimate and give you a separate written list of at least one available provider for each such service, with a statement that you may choose a different provider (12 CFR 1026.19(e)(1)(vi), eCFR). Which provider you pick affects the limits on how much those costs may rise by closing (1026.19(e)(3)); see Loan Estimate closing cost limits. Charges for third-party services the lender does not require, such as an optional owner’s policy, are in good faith if based on the best information reasonably available when disclosed, even if you end up paying more (1026.19(e)(3)(iii)(E)).
A seller may not pick your title company
No seller of property that will be bought with the help of a federally related mortgage loan may require, directly or indirectly, as a condition of selling the property, that you buy title insurance from any particular title company (12 U.S.C. 2608(a), LII, read October 30, 2026). Regulation X repeats this (12 CFR 1024.16, eCFR). A seller who breaks this rule is liable to the buyer for three times all charges made for that title insurance (2608(b)). The CFPB answers the question “can they do this?” with “No” (CFPB, last reviewed September 11, 2024; this page may be out of date).
This example is only for the math, with an example charge.
| Item | Example |
|---|---|
| Charges for the title insurance | $1,350 |
| Liability under 2608(b): 3 × $1,350 | $4,050 |
For your own case, ask a lawyer; you can look for legal aid through the Legal Services Corporation. You can submit a complaint at consumerfinance.gov/complaint.
Before closing
You must get the Closing Disclosure at least three business days before closing; compare its title lines with your Loan Estimate. See Closing Disclosure three-day review.
Questions to ask
- Is a lender’s title policy required for this loan, and may I choose the title company?
- Which title companies are on the written list of providers, and can I use one that is not on it?
- What is the full owner’s premium, and is a discounted rate available if both policies are issued together?
- What does the owner’s policy cover and exclude, and is an enhanced policy offered?
- What is the bottom-line total of all title-related costs?
Checklist
- Find the lines starting “Title” in Loan Costs and in Other Costs on your Loan Estimate.
- Decide whether you want an owner’s policy; it is marked “(optional)” when the lender does not require it.
- Compare title companies using the bottom-line total, not single lines.
- Remember that a seller may not require a particular title company as a condition of the sale.
- Compare the title lines on the Closing Disclosure with the Loan Estimate before closing.
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Sources
- CFPB: What is owner’s title insurance? (last reviewed October 19, 2023)
- CFPB: What is lender’s title insurance? (last reviewed September 11, 2024)
- eCFR: 12 CFR 1026.37, Content of disclosures for certain mortgage transactions (Loan Estimate) (Regulation Z), current text up to date as of October 28, 2026
- eCFR: 12 CFR 1026.38, Content of disclosures for certain mortgage transactions (Closing Disclosure) (Regulation Z), current text up to date as of October 28, 2026
- eCFR: Supplement I to Part 1026, Official Interpretations (Regulation Z), current text up to date as of October 28, 2026
- CFPB: Why is the title insurance premium on the Loan Estimate and Closing Disclosure different from the premium listed on the paperwork I received from the title insurance company? (last reviewed August 9, 2024)
- eCFR: 12 CFR 1026.19, Certain mortgage and variable-rate transactions (Regulation Z), current text up to date as of October 28, 2026
- Cornell LII: 12 U.S. Code 2608, Title companies; liability of seller
- eCFR: 12 CFR 1024.16, Title companies (Regulation X), current text up to date as of October 28, 2026
- CFPB: The seller told me I have to purchase title insurance from a particular company or they won’t sell me the house. Can they do this? (last reviewed September 11, 2024)
- CFPB: Submit a complaint
- Legal Services Corporation: Find legal aid
Disclosure: Modern Lending Solutions is not a lender, loan broker or agent for any lender or loan broker, and does not make credit decisions. Any compensation we receive is paid by participating lenders, only for advertising services. This guide is general information, not financial or legal advice.