For many, title insurance is a concept that’s hard to grasp, which is why we’re so dedicated to providing you the information you need to make the right decisions when you’re in the market for title insurance. But the truth is, knowledge isn’t just power; simply put, it’s money. And not fully understanding title insurance could cost you.
So before you purchase title insurance for that new property you’re planning to acquire, let’s examine some of the important things you should know about title insurance that can actually save you money.
Understanding title insurance and saving money – here’s how
You can choose your title insurance company
Many buyers will simply go along with whatever title insurance company their real estate agent recommends—and sometimes that’s just fine. But did you know you actually have a choice in the matter? Not only that but the cost of title insurance can vary from one title insurance company to another. Doing a little bit of legwork, including shopping around to find better pricing and asking around for trusted title insurance company recommendations, can save you money in the long run.
Know the importance of an owner’s title insurance policy
In addition to purchasing a lender’s insurance policy (which lenders will require), you will also want to purchase an owner’s insurance policy. It’s essential to know that a lender’s policy protects your mortgage lender from title defects but not you. An owner’s policy protects your investment against certain title risks, so you can have peace of mind. Go without, and you could find a title defect costs you your investment.
Check into simultaneous issue, reissue or substitute rates
As the buyer of a home, you have to purchase a title insurance policy. But your mortgage loan company will also likely get a separate insurance policy. In Minnesota, when these two policies are issued from the same title insurance company, you may be able to secure what’s called a “simultaneous issue rate.” Be sure to inquire about this possibility.
Additionally, in both Minnesota and Wisconsin, if the home’s title has been insured within 10 years, you may be eligible for what’s known as a reissue rate, sometimes referred to as a “prior title discount.” That could translate to a 40 percent savings on your new title insurance.
On top of that, if you are refinancing, you may be able to secure a substitution rate discount if you can show proof of a lender’s title insurance policy from within the past 10 years.
Title insurance: the importance of understanding what it’s all about
Understanding title insurance and what it means to you can seem overwhelming, especially when you’re in the midst of an exciting property purchase. With so much to think about and so much to do, it might be tempting to disregard it and trust that it will all fall into place. But by informing yourself and understanding title insurance better, you can ensure that your cash, and your investment in your property, are protected for many years to come.