The Utah buyer's guide
Title insurance in Utah.
Title insurance protects your ownership of a home against problems buried in its past: a lien nobody paid, an easement nobody mentioned, a signature that turned out to be forged three owners ago. It is not the same as homeowners insurance, and it is not one policy but two, an owner's policy that protects you and a lender's policy that protects your mortgage company. You pay for it once, at closing, and it stays in force for as long as you own the home. Here is what it really covers, how the two policies differ, why the premium is one time instead of monthly, and how to read the title commitment before you sign.
This is the product itself. For how the closing runs, who holds the money and when the deed records, see how escrow works in Utah, and the full path lives on the buying-a-home hub.
On this page
What title insurance is
Title insurance, in one breath.
Title insurance protects your ownership of the home against problems in its past: claims, liens, or ownership rights that existed before you bought it but did not turn up when the title was searched. Unlike homeowners insurance, which covers the house against future events like a fire or a burst pipe, title insurance covers the title against events that already happened, from your closing day backward through every prior owner. In most Utah purchases there are two separate policies. A lender's policy protects your mortgage company, and nearly every lender requires one. An owner's policy protects you and your equity, and it is optional, but it is the one that actually protects you. You pay for either policy once, at closing, and it never bills you again.
That is the whole idea, and this page is the product, not the process. If you want to know how the closing itself runs, who holds the money, how the deed records, when escrow closes, that lives on the escrow page and I have linked it throughout. Here I am staying on the insurance itself: what a title defect actually is, how the owner's and lender's policies differ, why the premium is one time instead of monthly, and how to read the title commitment the company sends you before closing so the exceptions on the second schedule do not surprise you at the signing table.
What a title defect is
The problems title insurance is built to catch.
A title defect is any past claim or right that could challenge your ownership or limit what you can do with the property, and that did not show up when the public record was searched. Title insurance is built around the ones that hide. These are the categories that come up most.
The money owed by someone else
Liens are the most common defect: an unpaid prior mortgage, back property taxes, a contractor who was never paid and filed a mechanics lien, a court judgment against a former owner. They attach to the property, not just the person, so a missed one can follow the home to you after you close.
The signature that was not real
Forgery and fraud in the ownership chain: a deed signed by an impersonator, a forged release of an old loan, a transfer made under a false power of attorney. These can surface years later and put a prior owner, or their estate, back in the picture.
The heir nobody knew about
When a past owner died, an unknown or omitted heir can appear and claim an interest the seller did not actually have the right to sell. A missing spouse, a child from an earlier marriage, or a will that surfaces late can all cloud a title that looked clean on paper.
The paperwork and the rights of way
Clerical and recording errors, a misfiled deed or a name spelled wrong, along with easements and encroachments: an unrecorded right of way, a fence three feet over the line, a utility easement no one mentioned. Some of these limit how you use the land rather than who owns it.
Owner's vs lender's
Two policies, one closing.
Nearly every financed purchase in Utah involves two title policies, and buyers mix them up because they are issued at the same closing by the same company. They protect different people, for different amounts, for different lengths of time. Here is the clean split.
| Question | Owner's policy | Lender's policy |
|---|---|---|
| Who it protects | You, the buyer, and your equity in the home | Your mortgage lender's interest in the property |
| Is it required | Optional, but the one that protects you | Required by nearly every lender |
| Who usually pays in Utah | The seller, by long-standing custom | The buyer, by long-standing custom |
| Coverage amount | The full purchase price | The loan amount, which drops as you pay it down |
| How long it lasts | As long as you or your heirs hold an interest | Until the loan is paid off or refinanced |
| If you refinance | Stays in force, no need to rebuy it | A new loan needs a new lender's policy |
Reading the commitment
How to read a title commitment in ten minutes.
Before closing, the title company sends a title commitment, sometimes called a title binder or a prelim. It is the company's written promise to issue the policy, and it is a preview of exactly what will and will not be covered. It comes in labeled schedules, and reading them in order takes about ten minutes and can save you a real headache. Here is how to read one.
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Schedule A: the facts of the deal
This is the who and the what. It names who is being insured, gives the legal description of the property, states the purchase price and the loan amount, and lists which policies will be issued and for how much. Check your name, the address, and the legal description against your contract. Errors here are common and easy to fix before closing.
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Schedule B-I: the requirements
Sometimes labeled Schedule B Part One, this is the title company's own to-do list, the things that must happen before it will insure clear title. Typical items: the seller's existing mortgage gets paid off and released, the deed to you gets recorded, unpaid taxes get cleared, and any judgment or lien gets satisfied. Most of these are handled quietly during closing. How the closing runs.
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Schedule B-II: the exceptions
Sometimes labeled Schedule B Part Two, this is the list of what the policy will not cover, and it is the part buyers skip and should not. It names the recorded covenants, conditions, and restrictions, the easements, the reserved mineral rights, and the rights of way that stay with the land after you own it. You are getting clear title except for these.
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Read the exceptions closely, and ask
A routine utility easement along the property line is normal. A recorded right of way that runs a neighbor's access across your lot is not, and you want to know which one you are reading. Flag anything you do not recognize and ask your agent and the title officer to explain it while you can still act on it. Your due-diligence window.
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Ask about standard versus extended coverage
Lenders often require extended coverage on their policy, and a survey plus signed owner affidavits can remove some of the standard exceptions from an owner's policy too. Whether that is worth it depends on the property. Your title officer and your agent can tell you what the extra coverage buys on this specific home.
The what-if scenarios
The edge cases, and how they usually play out.
What if I skip the owner's policy to save money? You usually can, because the lender's policy is the one that is required and the owner's policy is optional. Here is the honest tradeoff before you decide. If a title problem surfaces after closing, a missed lien, a forged signature a few owners back, an heir who resurfaces, the lender's policy pays to protect the lender's loan balance and nothing more. It does not defend your ownership or repay your equity. The owner's policy is the only one that pays to defend your title and reimburse your loss up to the policy amount. It is a one-time cost against a rare but expensive risk, and I recommend it to every buyer, but it is genuinely your call to make.
What if an exception on Schedule B-II worries me? Read the exceptions before your due-diligence deadline, not at the signing table, because your room to push back lives inside that window. An easement letting a utility company cross the side yard is routine and usually not worth a second thought. A right of way that lets a neighbor drive across your lot, or a restriction that blocks the shop you planned to build, is the kind of thing you want to catch early. If an exception is a real problem for you, your options range from asking the seller to clear it, to negotiating the price, to canceling inside your window, and which one fits is a conversation to have before the deadline passes.
What if the title search turns up a defect before closing? Then it usually lands on Schedule B-I as a requirement, and the title company goes to work clearing it, getting an old mortgage released, a lien paid, a judgment satisfied, or a missing heir's interest resolved, before it will insure the sale. Most of these clear quietly and you never hear about them. Now and then one cannot be cleared, and that is precisely the situation the title process exists to catch before your money is on the line. When the question is truly a legal one rather than a procedural one, that is the point to bring in a real estate attorney alongside your agent and the title officer.
Reading it with me
Someone who reads the exceptions before you sign.
The commitment lands in your inbox as a dense legal document, and most buyers skim it. The exceptions on the second schedule are exactly the part worth reading, and knowing which ones are routine and which ones matter is a local job.
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Twenty years in Southern Utah. I have read a lot of title commitments across Iron and Washington counties, and I can help you tell a standard exception from one that actually changes what you can do with the property.
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Agent and lender, one picture. I am licensed in both, so I understand what your lender needs from the lender's policy and what protects you on the owner's side. I take one role on your deal and never both at once, but I can read the whole file for you.
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The exceptions, in plain English. I will walk Schedule B with you before you are at the signing table, so an easement or a restriction is something you decided to accept, not something you discovered too late.
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Statewide, told straight. In Southern Utah I am your agent. Anywhere else in Utah, I connect you with a partner agent I trust in your area and stay involved through closing.
Questions, answered
What buyers ask about title insurance.
They protect two different people. The lender's policy protects your mortgage company's interest in the property, is required by nearly every lender, and is based on the loan amount, which decreases as you pay the loan down. The owner's policy protects you and your equity, is based on the full purchase price, and lasts as long as you or your heirs own the home. The owner's policy is optional, but it is the only one of the two that actually protects your ownership.
It is optional, not required, but I recommend it to every buyer. Without it, if a title problem surfaces after closing, such as a missed lien, a forged deed, or an unknown heir, the required lender's policy protects only the lender's loan balance and leaves your equity and your legal defense to you. The owner's policy is a one-time cost that defends your ownership and reimburses your loss up to the policy amount. It is your decision, but it covers a rare and expensive risk cheaply.
By long-standing custom in Utah, the seller pays for the buyer's owner's policy and the buyer pays for the lender's policy, according to the Utah Insurance Department. Custom is not law, though. Who pays either premium is negotiable and is written into the purchase contract, so it is worth settling early rather than assuming. On a cash purchase there is no lender's policy at all, only the optional owner's policy.
It is a one-time premium paid at closing, with no renewals, no monthly bill, and no expiration. Title insurance covers problems that already existed in the property's past, not future events, so once the policy is issued the risk it insures is fixed and there is nothing new to price each year. That is the opposite of homeowners insurance, which you renew annually because it covers future events like fire and storms.
Problems in the property's past that a title search did not catch. The common ones are liens, an unpaid prior mortgage, back taxes, a mechanics lien, or a court judgment, along with forgery or fraud in the ownership chain, unknown or omitted heirs who claim an interest, clerical and recording errors, and undisclosed easements or encroachments. Some of these challenge who owns the property and others limit how you can use it.
The title commitment is the company's written promise to issue your policy, sent before closing as a preview of what will and will not be covered. Schedule A lists the facts of the deal: the parties, the legal description, the price and loan amount, and the policies to be issued. Schedule B-I lists the requirements the company must clear before it insures, like paying off the old mortgage. Schedule B-II lists the exceptions, the recorded restrictions, easements, and rights that stay with the land and are not covered.
Your owner's policy does and stays in force the whole time you own the home, so you never rebuy it. Your lender's policy does not carry over, because a refinance pays off the old loan and creates a new one, and your new lender will require a new lender's policy on that new loan. If it has not been long since your last policy, ask the title company whether a reissue or refinance rate is available on the new lender's policy.
Keep exploring
Reading a title commitment and not sure what the exceptions mean?
I am Scott Buehler, and I have read a lot of title commitments across Southern Utah and helped buyers get to closing knowing exactly what they were accepting. The exceptions on the second schedule are where the surprises hide, and most of them are routine, but not all. Tell me about the property and where you are in the process, and I will read the commitment with you, translate the exceptions, and flag anything worth a question. No cost, and no pressure.
Not in Southern Utah? I will connect you with a partner agent I trust in your area, and stay involved through closing.