What does a Title Binder provide until the title insurance policy is issued?

A Title Binder offers temporary title insurance coverage until the formal title insurance policy is issued. This instrument serves as an interim measure that protects the lender and borrower by ensuring that the title is free from defects during the property transaction process. The title binder essentially provides assurance that a complete title search has been conducted, and confirms that the insurer is willing to provide insurance once all necessary conditions are met. This temporary coverage typically remains in effect until the final policy is formally issued, which usually occurs after closing.

In contrast, permanent title insurance would be issued only once the final policy is executed, thus a title binder cannot provide that level of security. A record of ownership is part of public record or the title insurance itself but is not what the binder provides. Legal representation pertains to the services of an attorney, which is separate from the function of a title binder. Therefore, the identification of the Title Binder as providing temporary title insurance captures its key role effectively.