Will owner's title insurance protect you from a flawed foreclosure? Yes, Pfotenhauer says.
"We have the duty to defend you in court -- the end," he says.
What if the claim is a result of mistakes made by the former mortgage servicer or lender, and records detailing the title are inaccurate?
"No, there isn't a way we could slip the noose," Pfotenhauer says. "Our obligation is actually to defend the title in court when it's challenged."
And it doesn't matter who was initially to blame for the issue, he says.
But not everyone agrees. In some instances, title insurers could step aside, especially if they believe the claim is baseless, says Joyce Palomar, law professor at the University of Oklahoma in Norman.
She urges homeowners to ask the title insurer for an endorsement that specifies "that the insurer will pay the insured's defense costs for a lawsuit about the validity of the foreclosure even if the insurer believes the insured will win the suit."