You found a home in Olympia and you are ready to close. The last thing you want is a surprise lien, an unknown heir, or a recording error slowing you down. If you have questions about title insurance, you are not alone. In this guide, you will learn what title insurance is, what it covers, how it shows up in Thurston County closings, and the key questions to ask before you sign. Let’s dive in.
Title insurance, plain and simple
Title insurance protects you from financial loss caused by hidden problems with a property’s title that existed before you bought it. It is different from homeowner’s insurance, which covers future physical damage. Title insurance deals with past events that could affect legal ownership. The Washington State Office of the Insurance Commissioner offers a helpful overview of how this coverage works for consumers in our state. You can review their guidance on title insurance to understand the basics and your rights as a buyer.
Two separate policies are common at closing:
- Owner’s policy protects your equity and ownership rights, usually up to the purchase price.
- Lender’s policy protects the mortgage lender’s interest up to the loan amount and is usually required when you finance.
Both policies are paid with a single, one-time premium at closing. Buying a lender’s policy does not protect you as the owner.
For a national explainer, see the American Land Title Association’s consumer materials, which break down owner and lender coverage in plain language.
What it covers and what it does not
Covered risks that come from the past
Title insurance generally covers hidden defects that existed before your policy date, including:
- Undisclosed or forged signatures in the chain of title
- Unknown heirs who later claim ownership
- Errors in public records or mis-indexed documents
- Undisclosed liens or judgments, including tax or mechanic’s liens
- Improperly recorded easements or restrictions that cloud title
- Mistakes in the legal description
If a covered issue arises, the policy can help pay legal costs to defend your title and cover financial loss up to the policy limit.
What it typically does not cover
- Problems that occur after your policy date, like new liens recorded later
- Physical damage to the home
- Matters deliberately concealed by the insured
For more on what title insurance does and does not cover, the Washington State Office of the Insurance Commissioner provides consumer guidance specific to Washington buyers.
Owner’s vs. lender’s: which do you need?
If you are getting a mortgage, your lender will almost always require a lender’s policy. This protects the lender’s security interest but does not protect your equity. The owner’s policy is optional from the lender’s perspective, yet it is generally recommended because it protects your ownership and the money you have invested.
The Consumer Financial Protection Bureau explains what to expect in your closing documents and where title insurance appears on your Closing Disclosure. Reviewing that form early helps you confirm which policies are included and who is paying for each.
Endorsements and “gap” protection
Title policies can be expanded with endorsements that address specific risks. Common add-ons include:
- Survey or access endorsements for boundary or right-of-way issues
- Mechanic’s lien endorsements
- Zoning or building permit endorsements
Many buyers also ask about “gap coverage.” This protects against claims that might arise between the date of the title search and the moment your deed and loan are recorded. Ask your escrow/title team if gap protection is included for both the lender and the owner.
For a plain-English overview of these options, ALTA’s consumer resources outline endorsements and why they may be recommended for certain properties.
Where title fits in an Olympia closing
Title search and commitment in Thurston County
Once your offer is accepted, the escrow or title company orders a title search. Examiners review records at the Thurston County Auditor’s Office, which maintains deeds, liens, plats, and maps. They also check tax status with the Thurston County Treasurer or Assessor. In some cases, local permitting records may be reviewed for code or enforcement issues.
The title company issues a title commitment. This document lists the conditions that must be met before closing and shows any exceptions, like easements or covenants that will remain after closing.
- Learn about recorded documents and searches at the Thurston County Auditor’s Office.
- Check tax and valuation questions with the Thurston County Treasurer and Assessor.
When charges appear and how you pay
Title insurance premiums are listed on your Closing Disclosure and are paid at closing as a one-time fee. If you finance, you will see the lender’s policy. The owner’s policy can be paid by either party, depending on your contract and local custom. The CFPB’s guide to the Closing Disclosure shows you how to read that form and verify who pays what.
Who pays in our market
Payment is set by your purchase contract and local custom, which can change over time. In some markets the seller pays the owner’s policy. In others the buyer pays. In Olympia, it is best to confirm current practice with your escrow/title company and your agent. They will show the allocation on your Closing Disclosure.
Costs and how they are set in Washington
Title premiums are based on rate schedules that apply to the insured amount. The owner’s policy is usually tied to the purchase price. The lender’s policy uses the loan amount. Endorsements add to the total. You will see your final premium calculations once the title company has your final purchase price, loan amount, and any endorsements. For consumer protections and general information on title insurance in Washington, the Office of the Insurance Commissioner is a reliable reference.
How to review your title commitment
Ask your escrow officer for the title commitment and the exception documents. Focus on:
- Easements and rights-of-way
- Covenants, conditions, and restrictions (CC&Rs), especially for HOA properties
- Recorded encroachments or boundary issues
- Any unreleased prior liens or judgments
Review these items with your agent. If you have questions about legal terms or risk, consider consulting an attorney.
Olympia buyer checklist: questions to ask before signing
Use this list with your escrow/title team well before final signing:
- Which title company or escrow agent is handling our closing? Please provide the contact name and direct phone or email.
- Who ordered the title search, and when was the title search and commitment prepared?
- What does the title search cover, and how far back do you search? Are there any unresolved exceptions or clouds on title?
- What title defects or exceptions were found, and how will they be cleared before closing?
- Will I receive an owner’s title insurance policy? If not, why not and what are my options?
- How much will the owner’s and lender’s title insurance premiums be? Please show the calculation and any endorsements that affect the price.
- Who customarily pays the owner’s title policy and other title or escrow fees in Olympia or Thurston County? How is it allocated in this transaction, and where will it show on the Closing Disclosure?
- What endorsements do you recommend for this property, and what are their added costs?
- Is gap coverage included for the period between the title search and recording? Will you provide recording-gap protection for both lender and owner?
- Will you confirm payoff of prior liens and the timing for recording the new deed and mortgage?
- What recording fees, county charges, and other closing costs will appear on the settlement statement? Please provide a written estimate.
- Are there any pending tax assessments, code enforcement issues, or unpermitted work that could become liens?
- For properties in an HOA, can you provide copies of the recorded CC&Rs and any pending assessments?
- How and when will I receive my owner’s title policy after closing?
- If a claim arises after closing, what is the process for filing and how quickly are claims handled?
Real-world examples of issues title insurance can address
- A prior mortgage was not properly released, and the old lender still appears of record. Title insurance helps clear the error so you can close with clean title.
- An unknown heir makes a claim against the property after an estate sale. The owner’s policy can provide defense and cover loss up to the policy limit.
- A contractor files a mechanic’s lien for work done before you bought the home. Depending on the facts, the policy can address undisclosed liens recorded prior to your policy date.
These examples are why an owner’s policy is commonly recommended along with the lender’s policy.
Partner with a local advocate
Clear title gives you confidence at the closing table. If you want help reviewing your title commitment, understanding endorsements, or coordinating with your escrow team, reach out to a South Sound expert who handles these steps every week. For thoughtful guidance from offer to closing in Olympia and across the Puget Sound, connect with Anne Watkins.
FAQs
What is title insurance for Olympia homebuyers?
- It is a one-time policy that protects against hidden title problems that existed before closing, such as prior liens, recording errors, or unknown heirs.
Do I still need an owner’s policy if my lender requires one?
- Yes, the lender’s policy only protects the lender’s interest; the owner’s policy protects your equity and your ownership rights.
Where will I see title insurance costs at closing?
- Title insurance premiums appear on your Closing Disclosure as part of closing costs, and they are paid at closing as a one-time fee.
Who usually pays for the owner’s policy in Olympia?
- It depends on your purchase contract and current local custom; confirm with your escrow/title company and your agent for your specific transaction.
What are endorsements and do I need them?
- Endorsements are add-ons that expand coverage for specific risks, like boundary, access, or mechanic’s lien issues; your title team can recommend options for your property.
What is gap coverage and when is it used?
- Gap protection covers the time between the title search and recording of your deed or mortgage; ask your title company if it is included for both lender and owner.
Links referenced in this guide:
- Review Washington consumer guidance on title insurance via the Washington State Office of the Insurance Commissioner.
- Explore national consumer explanations of title insurance through ALTA’s HomeClosing101.
- Learn how to read your closing paperwork with the CFPB’s Closing Disclosure guide.
- Understand title basics in plain language with the CFPB’s title insurance explainer.
- Check local recording and property records with the Thurston County Auditor’s Office.
- Verify tax status or assessments with the Thurston County Treasurer and Assessor.
