In today’s fast-paced real estate market, especially across Massachusetts, buyers are moving quickly to secure properties amid rising prices, high interest rates, and low inventory. While most buyers primarily focus on key terms of the transaction such as the purchase price, money down, lender financing, or closing contingencies, they often overlook one of the most critical components to closing on a home: title insurance. In 2025, hidden title defects are still a very real threat, particularly for buyers purchasing older homes, homes being sold out of an estate or trust, or pursuant to a decree from the court. Without title insurance, you could put your home and your legal claim to your property at risk.

What Is Title Insurance?

Title insurance protects homebuyers and lenders from financial loss due to defects in a property's title. These defects might include unknown liens, ownership disputes, forged documents, missing or unidentified legal heirs, or mistakes in the public record. Unlike other insurance types that protect against future events, title insurance defends you from issues that already exist but haven’t yet been discovered.

Title insurance protects your legal claim to your property. In the event that a legal dispute arises relating to a potential defect in title, the insurer would step in to defend your claim to the property. The insurer would be responsible for covering all legal fees, expenses, or repay any loss to the owner resulting from any financial burden suffered to the property owner arising from the alleged title defect, up to the policy limits. Unlike typical insurance such as homeowners or car insurance, title insurance is a one-time fee. The fee is typically paid at closing, and covers the homeowner for the entire length of time that you or your heirs own the property. This is extremely advantageous to buyers, because you pay one upfront fee that covers you for the duration of your ownership of your new property. Owner’s title insurance policies are calculated based off of the purchase price of the home. The owner’s policy is often discounted when purchased at the time of closing.

Types of Title Insurance

It is important to differentiate between the types of title insurance policies, however. There are lender’s title insurance policies and owner’s title insurance policies. If you purchase your home through a bank and obtain a mortgage, your lender (the bank) will require that you purchase a lender’s title policy, which cannot be waived. This fee will be part of your costs to close. The lender’s title insurance policy protects only the lender, and does not protect you, the buyer, in the event of a title defect down the road. Banks require the purchase of this policy to ensure their loan is adequately protected.

In order to obtain your own protection, you must purchase a separate, owner’s title insurance policy. The owner’s policy ensures that you have clear, marketable title to the property free of any encumbrances or liens that would adversely affect the property. The owner’s policy provides guarantees to the owner that if any such liens, encumbrances, defects or other title problems become known, the title insurer will defend the buyer’s title to the property. If you purchased a home through lender financing but declined to purchase an owner’s title policy, if a title defect did arise during your ownership of the property, you would be solely responsible for all legal fees and expenses required to defend your claim to the property. In the event that someone brings a successful claim against your property, you would be solely responsible for the resulting financial loss, which could be significant. As a result, the peace of mind that results from obtaining an owner’s title policy makes it a very worthwhile purchase.

Why Title Insurance Matters in 2025 and Beyond

Over the past several years, you have no doubt seen the headlines relating to the “Great Wealth Transfer” that is scheduled to occur over the next few decades. Many experts and financial institutions estimate that from now through the year 2048, over $124 trillion dollars of wealth is projected to transfer between generations. Millennials (born between 1981 and 1996) are expected to inherit roughly $84 trillion dollars from their Baby Boomer (born between 1946 and 1964) parents over the next 20 years. With real estate frequently making up a large portion of an estate, this means that Millennials will likely be selling off real estate over the next few decades, resulting in a heavy volume of real estate transactions that will coincide with this wealth transfer.

Accordingly, there will be more and more buyers that are purchasing homes from an estate after they were inherited following the death of the original owner. If the decedent died with a valid Will or Trust in place, the transfer of property and the overall title picture becomes a bit clearer overall, but this is not always the case. However, if the decedent died without a Will and owned property in their own individual name, it means that the title of the property will pass through the Massachusetts Intestacy Laws. Click here to read our full legal blog covering the Massachusetts Intestacy Laws and how property transfers after death if someone dies without a Will. In these situations, selling property often requires petitioning the court, along with full cooperation of all legal heirs. This can often result in improper transfers or potential defects in title such as:

• Improperly recorded deeds that were not executed by all legal heirs;
• Noncompliance with court orders, where the sale is wrongly conducted or fails to meet the strict timing and procedural requirements of the Probate Court or the Land Court;
• Undisclosed legal heirs are not properly identified or cannot be located during the probate process, making the property susceptible to the reemergence of this legal heir in the future, staking a claim to the property;
• Other Conflicts between family relating to inherited property [click here to read full legal blog]

Potential title defects are not limited just to sales of property coming out of an estate. Other potential defects for all purchases include:

• Forged documents in the chain of title;
• Signatures of mentally incompetent persons or minors which are unknown to the party reviewing the title;
• Mistakes or inaccuracies in recording of legal documents of title at the appropriate place or recording or registration of title;
• Fraud in the execution or in the handling of the recording or indexing of recorded documents;
• Invalid divorces or misrepresentation of marital status of the parties signing the documents;
• Clerical errors in the public records and claims of parties that are unknown because their claims have not been filed in any indices of public record.

In a rush to close quickly, some buyers attempt to take shortcuts, which in turn leaves them exposed to serious legal and financial headaches down the road. At Lane, Lane & Kelly, we help families across the Commonwealth of Massachusetts with all of their real estate, estate planning, and probate needs. We have seen firsthand how complicated it can be facilitating the sale of a home when there are numerous heirs that must approve and assent to the transfer. And unfortunately for buyers, when the proper procedural steps are not taken in evidencing the chain of title to a property, it could be the current owner that ends up paying the price. Unless of course, they make the wise decision in purchasing an owner’s title policy to protect their investment.

How an Experienced Closing Attorney Can Help

In Massachusetts, buyers are required by law to have a closing attorney involved in their real estate transaction. But not all attorneys take the same level of care in reviewing the title and protecting you from unforeseen legal risks. At Lane, Lane & Kelly, our attorneys will:

• Conduct a comprehensive title search to identify potential defects, and correct them before closing if possible;
• Review probate documents when properties are sold out of an estate;
• Flag and help resolve any irregularities in the chain of title;
• Advise clients on the benefits of an owner’s title policy, the cost, and the expansive protections that it provides based on the property

When it comes to closing on your dream home, don’t trust just any real estate attorney to handle your closing. There is a lot that goes into purchasing a home. While it is easy to overlook something as mundane as insurance, when it comes to purchasing your home, you can never be too careful. Our real estate attorneys have years of experience handling transactions for both buyers and sellers, and our firm was recently voted as the Best Law Firm on the South Shore of Massachusetts in 2024.

The real estate market in 2025 may be moving fast, but you can rest easy knowing our attorneys will work tirelessly to protect your legal interests every step of the way. Title insurance is unique in that it protects you from mistakes and errors that were done in the past rather than against issues that arise in the future. Don’t let someone else’s mistakes become your headaches. With the right legal team and an owner’s title policy in place, you can avoid costly title trouble and protect your property for the long haul. Contact us today for all of your real estate needs.

This blog is made available for educational purposes only as well as to give you general information and a general understanding of the law, not to provide specific legal advice. By reading this blog you understand that there is no attorney client relationship between you and Lane, Lane & Kelly, LLP.