Closing Protection Coverage: The Basics
Closing protection coverage is an additional kind of insurance policy that protects a buyer and seller during the closing process. Closing protection coverage can protect against unethical or fraudulent closing or escrow agents, as well as title company errors and omissions.
How Closing Protection Coverage Can Protect You
Closing protection coverage, which is usually conveyed in the form of a closing protection letter, can typically protect against:
Closing Protection Coverage Also Protects Lenders
Closing protection coverage via a closing protection letter isn't just available for buyers and sellers, it's also available for lenders, to protect against any issues involving a closing or escrow agent that could affect the borrower's ability to pay back their mortgage. In some states, like Ohio, it's mandatory for title, closing and escrow agents to inform the parties in a transaction that closing protection is available.