For most consumers, purchasing a home will be the single largest investment they make. Whether a consumer is a first-time homebuyer or a couple downsizing their current home for retirement, an owner's title insurance policy ensures that the title to the property is clear of known issues that may impact their ownership rights, such as unpaid mortgages, property taxes or child support.
“Your home is where you’ll spend time with family and friends, and build a lifetime of memories. You want to make sure those memories and your investment are protected by purchasing an owner’s title insurance policy,” said Rob Chapman, president of the American Land Title Association (ALTA). “New homeowners want to focus on buying new furniture for the living room or painting walls, not worrying about having to pay a bill left behind by a previous owner.”
The cost for title insurance varies from state to state. Consumers should talk to a local title company for how rates are determined where they live. When comparing fees, it’s important to get detailed information about what services are included in a fee to help ensure equal comparisons. In some states, the seller pays for the owner’s title insurance policy.
This encouragement from the industry comes as regulators are continuing efforts to encourage consumer shopping. This summer, the Nevada Department of Insurance created a title insurance rate calculator to make it easier for consumers to compare rates. The National Association of Insurance Commissioners is working on a consumer shopping guide to help consumers understand title insurance and the closing process. Their next meeting is Sept. 2. Check back with The Legal Description to find out more.
Although many consumers rely on their real estate agent or mortgage lender for a recommendation for a title company, ALTA and its more than 5,300 member companies remind consumers that they have the right to shop for title insurance and to choose their own title agent or company.
“There are many title companies to choose from and many factors to consider when selecting a title insurance company, such as local expertise, service standards, market conduct and commitment to the community,” Chapman said.