A mortgagee's title policy remains in effect until:

• A. The property is sold
• B. The policy expires after 30 years
• C. The borrower dies
• D. The mortgage is paid off

Answer: (D)

The key idea is that a mortgagee’s title insurance is tied to the lender’s financial interest in the property for as long as the loan exists. The lender’s security in the title remains at risk until the mortgage is fully paid off and the lien is released, so the policy stays in effect for the duration of the loan. It isn’t determined by how long the borrower owns the property, by a fixed time like 30 years, or by the borrower’s death. Once the mortgage is paid off, the lien is released and the policy can be terminated; until then, the policy protects the lender against title defects that could affect the lender’s security.