Lender’s Title Insurance vs Owner’s Title Insurance
When we talk about title insurance, we are generally referring to two types. Lender’s ownership insurance protects the institution that is lending you the money for your new home or property. This is required, and usually costs around $1300-to-$2700. In some cases, it can cost up to $4000.
Thank you for reading this post, don't forget to subscribe!Ownership insurance is usually optional, but importantly, it protects you against the same things. This can save you from having to spend a lot of money (out of your own pocket) to be evicted from your home or to help settle a dispute that started decades ago. Long ago you saw that “For Sale” sign on the lawn and dreamed of moving in.
Owner’s title insurance is usually available for a relatively small add-on if you’re working with the same company. Since the fee itself covers the administrative work that goes into checking the property for any irregularities, it makes sense to bundle them together so that you pay for the process only once. Since you have to go through this process for the lender anyway, paying the extra fee for owner’s title insurance becomes a simple investment in time, money and protection.
but do you need This?
If you’ve bought an expensive gadget recently, you probably understand the dilemma. When you’re already paying a lot for something, it can be tempting to cut costs at the end of the process. When you recently bought an iPad Pro for $1000, you might question whether you really need the extra protection plan for $150 (or the $75 protective case). Of course, it covers all the bad things that can happen to a new device once you buy it, like accidental damage and theft. But when you’re already spending that $1000, $150 seems like a lot.
However, you don’t want to bring that same logic into the purchase of a piece of property. The average single-family home costs $261,600. Or exactly 2616 times the cost of that iPad over the life of your mortgage. You’ve probably made an upfront payment of about $50,000. Furthermore, you want this piece of property to become a permanent investment. It could be the site of a future construction or subdivision or it could just be your home. Regardless, you may have chosen it not only because of its price, but also its convenience for commuting to work, school, or nearby family and friends. You don’t want to give it all up if a problem comes up along the way, especially when it’ll only cost you $500 (or less) to fix.
Buy owner’s title insurance. Never go without it. You might never need a lifejacket, but you’ll be glad the ferry put it under the seats.
