20 years ago, no-one in Canada had heard about title insurance, but now it’s required by both conventional and MIC lenders. Why is this?
In the beginning title insurance was marketed as a replacement for survey certificates, but as it developed, lenders realized that the true benefit was coverage for fraud or other title defects that went beyond what a traditional Solicitor’s Opinion provided. As a result it has now been adopted as a requirement of most lenders at closing.
It’s a good idea to prepare your borrowers for this cost in advance of closing. They’ll see it set out on the closing documents at the lawyers office, and its prudent to work in the cost of title insurance when estimating the closing costs for your borrower to avoid any last minute surprises.