If you are a first time home-buyer, or even if you aren’t, certain terminology used by mortgage lenders and realtors can be slightly overwhelming. Especially when it comes to fees, it’s frustrating when you don’t completely know what you’re paying for…or if it’s even necessary.

As defined by the New York Times, “title insurance is a way to assure that no one but you has a claim on your home — that there are no outstanding liens, misfiled deeds or mysterious former owners. “

Compared to most other kinds of insurance that charge consumers on a monthly or quarterly basis, consumers pay one-time premiums for title insurance. Essentially, these policies last for as long as the borrower owns the home. However, title insurance policies must be repurchased each time a loan is refinanced, albeit at a lower issue rate.

So, how much does title insurance typically cost? While it varies by location, title insurance is generally a small percentage of the home’s cost. According to First American Title Insurance, “a $300,000 home with a $240,000 mortgage in New York City, it would cost $1,164 for a lender policy at purchase.  Opt at purchase for both lender and owner polices, and it would cost $1,749. A $240,000 refi lender policy two years later on that same property would cost $582.”

Lastly, don’t forget to shop around for the best “title” deal for your location. While you might find that in your particular state that title insurance rates are set by the state’s insurance department or another agency, many other related costs are not fixed, which is why it still pays for most consumers to shop around.