--- title: "Owner's vs Lender's Title Insurance: Do You Need Both? | MCC" description: "Why a home purchase usually has two title policies, who each protects, what they cover and exclude, and when the premium is paid. Closing soon? Book online." url: "https://mcc-solutionsnj.com/notary/guides/owners-vs-lenders-title-insurance" --- Guide · Updated October 12, 2026 # Owner's vs. Lender's Title Insurance: Two Policies, Two Jobs Title insurance surprises many buyers because it is paid once, at closing, and protects against problems that began before you owned the home. Two different policies are usually involved. By [Matthew Coleman](/about), MCC Solutions **Quick answer.** The lender's policy protects the bank's lien and is required on nearly every purchase loan. The owner's policy protects you against defects in the title that began before you owned the home. They are two separate policies, usually paid once at closing. Need this notarized? Sign online from home with no travel fee, or ask for a notary to come to you. The price is shown and confirmed before any work starts, and you can book in about two minutes. [See your price and book](/notary/#order)[Call (908) 444-6373](tel:9084446373) **Related:** [NJ notary fees](/notary/fees) · [How long a notary keeps the journal](/notary/guides/how-long-to-keep-a-notary-journal) · [Who can witness a signing](/notary/guides/who-can-and-cannot-be-a-witness-to-a-signing) **Free tools:** [Child travel consent letter](/notary/child-travel-consent-letter) · [Notary fees by state](/notary/fees-by-state) ✓ New Jersey commissioned notary, no. 50244803, insured for errors and omissions. [See the credentials](/about/credentials) ## The lender's policy The lender's policy protects the bank or investor that makes the loan. It covers their lien position if a title defect threatens the mortgage. Lenders require it on nearly every purchase loan, and the borrower typically pays the premium as a closing cost. The coverage amount follows the loan balance and shrinks in practice as the loan is paid down. It does not protect you personally. ## The owner's policy The owner's policy protects your ownership interest and covers defense costs if a covered claim is made. It is separate and often optional, although in some deals the contract assigns who pays. It lasts as long as you or your heirs hold an interest in the property. Because the owner's policy is a one-time premium, you decide at closing, not later. Ask about it early. ## Examples of covered problems Common covered risks include forged signatures in the chain of title, undisclosed heirs, errors in public records, unpaid prior liens and recording mistakes. These are hidden defects that a search may not catch. The policy does not cover everything. Matters listed in the exceptions, new problems you cause after closing, and zoning issues are typically excluded. ## Reading the commitment Before closing, the title company issues a commitment. Review Schedule B, which lists exceptions and requirements. Requirements are things that must be fixed before the policy issues, such as paying off a prior mortgage or recording a release. Ask the title officer to explain any exception that worries you. ## Costs and shopping Premium rules differ by state, and in some states the rates are filed with a regulator. In others you can compare quotes. Your Closing Disclosure lists title charges, and some are services you may shop for. A signing agent cannot recommend a policy. Ask your attorney or title company, and keep the policy once it arrives, since you may need it on a refinance or sale. ## A sample timeline and questions to ask your title officer Early in the process the title company searches records and issues a commitment. Any problems found, such as an old mortgage that was never released, are listed as requirements. They must be cleared before closing for the policies to be issued without that exception. At closing, premiums are collected. Weeks later, the final policies arrive by mail or electronically. Store the owner's policy with your deed and closing papers, since you may need it if a claim arises. What exceptions are in Schedule B and what do they mean? Is there a survey exception? Are any prior owners' liens still open? Is there an extended coverage option? What happens if someone claims an interest in the property? Their answers will tell you what the policy actually protects. Refinancing can raise the question again. A new lender will require its own policy for the new loan, but your existing owner's policy typically continues. Some title companies offer a reduced rate for a new lender's policy if you recently bought. Ask whether you qualify, and keep your original owner's policy with your records. ## Common questions **Do I need both policies?** Lenders require their own policy. The owner's policy protects you and is often optional, so discuss it with your agent or attorney. **Is title insurance renewed yearly?** No. It is generally a single premium paid at closing. **Can a notary advise on title insurance?** No. Notaries identify signers and notarize documents. Title questions go to the title officer. ## More notary guides - [Types of Deeds: Warranty, Bargain and Sale, Quitclaim](/notary/guides/deed-types-warranty-quitclaim-bargain-and-sale) - [Gifting or Inheriting a Car: Title Paperwork Guide](/notary/guides/gifting-or-inheriting-a-car-title-paperwork) - [Jurat vs Acknowledgment: Which Notary Act Is It?](/notary/guides/jurat-vs-acknowledgment-differences) This guide is general information, not legal advice. 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