How Much Does Title Insurance Cost?
The ins and outs of buying a home don’t have to be very complicated. Industry professionals are there to help. It’s what we do every day! But it is important to know what you need to protect yourself during the purchase period — and for the long haul.
How much does title insurance cost? Well, it can vary widely depending on which state you live in, but the overall average is about $1,000 per policy. Another variable that will determine the costs of a title insurance policy is the purchase price.
Do you know the true value of title insurance?
Read more to find out what it covers, more about pricing, why it’s important, and how you can save money on your policy.
What is Title Insurance?
Basically, it is a type of insurance that covers the search of the property documentation and records to make sure the title is valid and contains no errors. This can include such things as outstanding liens on the property, clerical errors, outstanding property taxes, undisclosed heirs, or similar issues that can declare the title invalid or defective.
Title insurance also includes underwriting for both the homebuyers and the lending institution. You will typically need to buy these two separate policies — the Owner’s Policy and the Lender’s Policy.
What Does It Cover?
There are a number of risks that title insurance will cover to insure a legitimate home purchase. These types of risks include:
- Undisclosed (recorded) lien, mortgage, use restriction, or easement
- Impersonation and forgery
- Deed is not properly recorded
- Deed doesn’t include a necessary party ( heir, spouse, business partner, co-owner, corporate officer)
- Lack of legal authority or competency
All of these risks can end up causing major complications— and even involve lawsuits. This can be a stressful and expensive endeavor if you don’t have title insurance policy.
Why Should I Purchase Title Insurance?
Just like other types of insurance policies, title insurance is there to protect you. As mentioned above, buying a home can be very risky without it. It protects your financial interests not only in the short term during the purchase period, but also the full time you are living in your home. You need it to cover associated costs if a claim on the deed arises regarding the ownership of the property.
As an example, an heir may “come out of the woodwork” a year or more after you are settled in your home and try to stake a claim on the property. The policy will cover legal costs associated with the ownership claim, leaving you to breathe easy and not having to deal with surprise expenses in relation to the claim.
How Much Does Title Insurance Cost?
Title insurance is a one-time payment made during the purchase period. It could either occur prior to closing or while you are at the closing table. Prices can vary from hundreds of dollars to around an average of $1,000 or more per policy (Owner’s & Lender’s).
The variables that may affect the price of title insurance include:
- Geographic location
- Purchase price
- State regulations
- Available bundle discounts
- Negotiations with seller
- Negotiations within full components of the policy
States such as Florida and Texas have regulations where the title insurance premiums are fixed by the government. Working with a trusted title insurance company makes the process simple, secure and smooth — offering you the personalized protection you need to feel confident about one of the most important purchases you will ever make.
How Can I Save Money on My Title Insurance Policy?
Are you looking to lower your total home purchase costs? There are options in many states to be able to save money when it comes to your title insurance policy. These can include:
- Title insurance for new construction sometimes has discounts — ask your company rep
- “Reissue Credits” may be available if another policy was recently purchased
- A bundling of the Owner’s and Lender’s policies is sometimes available
- Negotiate with the seller — they may opt to cover it (but be wary in a very competitive market!)
- Discuss any add-ons with your provider — get the best fit for your particular property
Discounts are not guaranteed, but it is certainly worth a conversation with your title insurance company. You want to make sure you are well protected, but you may be able to save some money that you can use toward the full purchase of your home.
But do understand that quality truly matters. Saving a few bucks is great, but you want to be assured the title company you’ve selected has the know-how and experience to conduct their searches with accuracy and process the needed paperwork in a manner that means you close on the day promised.
The Many Benefits of Title Insurance
If you have been wondering, “How much does title insurance cost?” — you’re not alone. Homebuyers across the United States want a great home for a great price and are looking at their budgets closely. The many benefits of title insurance far outweigh the associated costs. Title insurance policies not only help to preserve the stability of your financial future but also serve to give you the peace of mind that you will be able to live comfortably in your home (and your heirs, too!)
You need to be well protected in case any issues arise regarding the deed to your home. From storing all your stuff to doing business, don’t you want to be clear on what the future holds for your property?
Having a dedicated and highly qualified team on your side will give you the confidence you need to move through it all smoothly and with no worries.
Bay National Title Company offers unparalleled title insurance services with accuracy and integrity — helping home buyers and exceeding expectations across the country. We will communicate clearly, perform efficiently, exceed your expectations, and give you peace of mind and confidence in our services before, during and after your closing with us.
For more information on our comprehensive services, please click here.