Even the most thorough title examination cannot uncover every possible risk. Many times there are hidden problems that are not disclosed by a search of public records. For example, there may be forgeries, missed heirs, voidable instruments or mistakes made in recording documents. Not even the best title examiner would know of these undisclosed issues, but they still represent a risk to you, the home owner.
As a condition of your loan, your lender will require a policy to be issued to protect their interest in the real estate. The premium for this policy will be part of your closing costs. If your lender knows the value of this coverage and makes it a condition of lending money, don't you think you deserve and need to be covered also? A one time premium to protect what is likely to be the biggest investment you will ever make just makes good sense.
