How Much Does Title Insurance Cost and How Do You Get a Better Offer?
Figuring out the answer to the question, how much does title insurance cost, is certainly not easy. The main obstacle is that title insurance is somewhat of an obscure term from a laymen perspective, and that not all title policies are made equal. In fact, depending on the company you contact to take care of your title insurance needs, the pricing, the long term benefits and the convenience of the title search will differ greatly. As a result, it is extremely important to stay informed and have a good idea of what title insurance is all about, how much the price is, and what you can do to get a more advantageous deal.
What Does Title Insurance Actually Insure?
As the name would suggest, title insurance is designed to insure the claim that a homeowner has on the title of a certain property that they’ve recently become the owners of. Should a past owner return to make a claim on the property, or should documents arise speaking of unpaid liens and heirs who have never been mentioned for the past 30-40 years, the current owner could lose his/her claim on the property along with the amount of their mortgage that they’ve already paid. To avoid such concerns, title insurance agencies conduct title searches to find all the discrepancies that only show up in archives and older documents. Depending on how thorough the search will be, the price can be significantly higher than average. But let’s look deeper and see, how much does title insurance cost, and what are the main concerns that have to be considered prior to getting it?
What Determines the Title Policy Cost?
How much does title insurance cost and what determines the fees and prices that are involved? The main factor is the mortgage amount and the lender. If the total amount and the interest rate is greater, the title insurance costs will be higher. Also, for some states, where title insurance is regulated by the state, there is a fixed amount that all title insurance providers have to abide by.
Title Insurance Cost Based on Mortgage Amount
Title insurance costs can be confusing even taking into account the mortgage amount. While some providers charge up to $1,700 for owner’s title and $1,300 for lender’s title insurance in cases when the total mortgage amount doesn’t exceed $400k, others will ask for similar amounts when homes are involved that rated twice as valuable. The absolute average price for a home worth $300,000 is somewhere between $700 and $1,000 for lender’s insurance and $800 to $1,300 for owner’s insurance.
Negotiating a Better Title Insurance Price
When asking, how much does title insurance cost, you’ll find the answer can be same at every provider, in which case it means that the state you live in regulates title policies. If title insurance isn’t regulated, however, then it’s possible to shop around. The best offers, regardless of location, can be found by negotiating on various add-ons. Even if the actual price of the insurance policy can’t be negotiated, insurers will often include various services and so-called policy add-ons that most homeowners don’t need. For those wanting a better answer to the question, “how much does title insurance cost in my area,” discussing these add-ons and negotiating on the price is the best possible course of action.