Title Insurance helps to protect buyers and mortgage lenders in the case that an incident arises during the transfer of property ownership. If a problem were to occurrence the title insurance company would be held accountable for paying specified damages. Typically homebuyers are required to acquire two title insurance policies, one to protect the owner and the other to protect the lender.
If you a homebuyer who needs to buy title insurance the should ask the following four questions.
Are title insurance prices regulated?
Across the United States, insurance prices are often regulated. In most states you will find that there isn’t much of a difference in terms of price across companies. However, in places where title insurance is not regulated, the cost could have as much as a 10 to 20 percent difference.
You will want to check with your lender or state insurance department to see if you are in cost-regulated area.
With that being said. home buyers should look at two factors:
- The quality of the insurance
- The quality of the title search
- The goal is to find a title company or attorney that will do a thorough search and an underwriter that will still be around in 10 or 15 years if there’s a problem.
The main priority is to find a title company or attorney at law that conducts a a thorough search. You will also want to find an underwriter who will be around for the next decade in case there is a problem in the future.
Although title insurance costs are regulated, wire transfer fees or courier fees can add an extra expense, so remember to ask about the total transaction price, not just the cost for insurance.
How much coverage do I need?
Owner’s policies help to protect against a number of things including protect against a number of incidents including, fraud, forgery, undisclosed heirs and spousal claims.
Your lender may require additional insurance on the property or mortgage. An adjustable-rate mortgage for example, helps to guarantee that the lender is the first to receive payment in case the house were to go into foreclosure.
Who pays for title insurance?
The buyer’s and lender’s are both responsible for paying for the two policies. Depending on the area the buyer may pay for one, and the seller may pay for the other.
Just because the buyer pays, does not mean you can’t haggle over the price. It can be negotiable.
Who Should I trust?
If you are looking for advice and have to choose between your seller, real estate, agent, and mortgage lender, it is the wisest to consult your mortgage lender. The lender will be in your best interest, so they will want to make sure that you are getting things done correctly.