What type of title insurance is required in a commercial real estate transaction?

In Arizona, commercial real estate transactions typically require the buyer to obtain title insurance in order to protect their interests. Title insurance is a policy that guarantees that the buyer is receiving a valid title to the property, free from any liens or claims. It provides financial protection from losses due to title-related defects that existed prior to closing. In Arizona, two types of title insurance are typically required in a commercial real estate transaction: owner’s title insurance and lender’s title insurance. Owner’s title insurance guarantees that the title is free from any lien or encumbrances, as well as any title defects that existed prior to the purchase. This type of insurance is typically obtained by the buyer as a means of protecting their investment in case of a future claim against the title. Lender’s title insurance provides protection to the lender in terms of their loan in the event of a title-related defect. This type of insurance is issued in the amount of the loan and is typically required in cases where the buyer is unable to obtain owner’s title insurance. It protects the lender from any losses incurred due to a title defect. In conclusion, both owner’s title insurance and lender’s title insurance are typically required in a commercial real estate transaction in Arizona. Title insurance provides protection for both the buyer and the lender, ensuring that the transaction is valid and free from any title-related defects.

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What type of title insurance is required in a commercial real estate transaction?

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