In real estate transactions, who typically pays for title insurance?

In real estate transactions, it is customary for the buyer to pay for title insurance, although practices can vary based on local customs or negotiations. Title insurance is intended to protect the buyer from potential issues related to the property's title, such as undiscovered liens, claims of ownership, or other discrepancies that could arise after the purchase. By purchasing title insurance, the buyer ensures that they are safeguarded from these risks, making it a crucial investment in the property acquisition process.

While lenders also require title insurance to protect their investment, it is typically the buyer who bears the cost of the owner's policy. The practice of one party paying for title insurance can be influenced by negotiation between the buyer and seller. In some markets, it may be common to split the cost or have the seller cover it; however, the most prevalent standard is for the buyer to assume this expense, highlighting the importance of being aware of local customs and practices when engaging in real estate transactions.