Title Insurance Vs. Warranty Deed

Title insurance and a warranty deed are both legal documents that are used in real estate transactions. Each is related to issues of ownership of properties, particularly the legal claim on ownership of a property.

Title Insurance

Title insurance policies offer protection for either a lender or a property owner. Title insurance insures against a financial loss that might result because of a disagreement over the ownership of a property.

Warranty Deed

A warranty deed is often used in a property transaction as a way for the seller to affirm that he is the owner of the property. The deed demonstrates that the seller will stand behind that claim and defend the validity of a property's title against any other claims.

 

Significance

Both title insurance and warranty deeds help to solidify real estate transactions, offering some protection to participants that a legal exchange of ownership is occurring and that the participants have the right to make the deal. Title insurance offers some financial protection, while a warranty deed is about legal protection.