Why do I need two title policies on a double close?

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Real Estate Closing Attorney

We get this question often, and I think a lot of Attorneys (or other states) give people poor advice about this. I 100% say to get that 2nd title policy.

Here’s how a title claim works, if there’s a problem in title insurance.

  • Your end buyer has his policy with lets say, American Insurance. They sue the old owner (you) to fix the claim (and the people behind the issue) .
  • If you have a title policy for your purchase, you send that Insurance claim to your company, and they take care of everything.
  • They’ll turn around and sue the people that you bought this from. You’ll lose nothing but maybe a small deductible for all the attorneys fees.
  • If you close without title insurance, your buyer is suing you and you have no one to cover the Attorneys fees/costs. You’ll have to pay and attorney (Probably $5k to start, $20k for any decent case, up to $40k for a long one) to defend you and sue the person you bought the house from.

So, I think it’s worth the $150 or whatever for that 2nd title policy.

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