What Is Title Insurance and Why Do Las Vegas Sellers Pay for It?

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• Closing Costs Sellers Pay
• What Happens at Closing
• What Sellers Must Disclose

You're reviewing your estimated closing costs and see "title insurance" for $1,500-2,500. What is this, and why are you paying for it?

What Title Insurance Protects

Title insurance protects against problems with property ownership that existed before the sale but weren't discovered. These "title defects" could include:

• Unknown liens. Unpaid contractor bills, tax liens, or judgments attached to the property.
• Ownership disputes. Someone else claiming they own the property or part of it.
• Forgery or fraud. Previous documents that were forged or fraudulent.
• Errors in public records. Mistakes in deeds, surveys, or other recorded documents.
• Unknown heirs. Someone who claims inheritance rights to the property.
• Easements. Undisclosed rights others have to use the property.
• Boundary disputes. Issues with where the property actually ends.

Two Types of Title Insurance

Owner's policy: Protects the buyer's ownership interest. In Nevada, the seller typically pays for this policy. It protects the buyer for as long as they own the home.

Lender's policy: Protects the buyer's mortgage lender. The buyer typically pays for this if they're financing. It protects the lender's interest in the property.

As a seller, you're usually paying for the owner's policy that protects your buyer.

Why Sellers Pay in Nevada

Who pays for what at closing varies by state and local custom. In Nevada, tradition and standard contracts have sellers paying for the owner's title insurance policy.

This is negotiable in theory, but deviating from custom creates friction. Most sellers simply accept this as a standard closing cost.

What It Costs

Title insurance is a one-time premium paid at closing. Cost is based on the sale price:

Rates vary by title company. Your escrow officer can provide exact quotes.

The Title Search Process

Before issuing insurance, the title company researches your property's history:

1. Examines public records for deeds, mortgages, liens, and judgments
2. Verifies chain of ownership
3. Identifies any encumbrances or claims
4. Issues a preliminary title report
5. Resolves any issues found before closing

This search protects everyone by identifying problems before they derail the sale.

What If Issues Are Found?

Sometimes title searches reveal problems:

Liens you forgot about. That old contractor lien or tax lien must be paid off at closing.

Errors in previous deeds. May require corrective documents to be recorded.

Boundary or survey issues. May need resolution before closing can proceed.

HOA violations. Outstanding assessments or compliance issues.

Most issues can be resolved, but they may delay closing or require you to pay amounts you didn't expect.

Your Title Insurance from Purchase

When you bought your home, you may have received an owner's title policy. That policy protected you during your ownership. Now that you're selling, you're providing similar protection to your buyer.

Is It Worth It?

Title insurance isn't optional in standard transactions. Buyers and their lenders require it. The cost protects against potentially catastrophic claims that could take the property away from the new owner.

While title problems are rare, when they occur, they're serious. Insurance provides peace of mind for a one-time cost.

The Bottom Line

Title insurance is a standard closing cost for Las Vegas sellers. You pay for the owner's policy that protects your buyer against unknown title defects. It's part of delivering clear, marketable title to the new owner.

Questions about title insurance or closing costs? Let's review your expected costs.