If you are pre-approved for a mortgage and have put down a good-faith deposit on a piece of property then you are likely going to need lender’s title insurance. This policy is one that doesn’t do much for you as the owner, but it does protect the lender who is taking the risk by giving you a loan.
The majority of the time, a lender will require that you purchase this insurance policy as a condition of the loan. Because of this, many borrowers choose to shop for lenders' title insurance.
Here’s how to do it.
Understanding Title Insurance
It is understandable that having to pay for a title insurance policy when you are trying to save money can be a bit frustrating. This is especially true since you may be making the biggest investment of your life thus far.
Nonetheless, lenders want to be protected in case something goes awry.
A title company will perform a title search to look at property records dating back as far as they go. They make sure that there are no judgments, liens, titles, claims to the property, easements, and so on. In other words, they are making sure the title is clear and ready to close.
In the event that something is missed during the title search, your rights to property may be in jeopardy - and the lender's funds used to purchase it may be at stake. To guard against this, the title company will sell you a lender's title insurance policy and an owner's title insurance policy. Each of these will allow the title company to fight the claim so you don’t have to worry about your property rights.
When it comes to title insurance, it is important to note that these are two distinct title policies and that the lender’s policy will not offer you any protections should something arise.
Shop For Lenders Title Insurance
It is not uncommon for homebuyers to allow their real estate agent to direct them to a title company. What many fail to realize is that you have the authority to choose any title company you want. And, if you are in a state that doesn’t regulate the cost of title insurance, then you can feel free to shop around.
You may find that one title company offers a better rate than another. Or, you may feel that it is safer to stick with the title company that came recommended. The choice is yours.
Know All the Service Fees
In addition to title insurance, many title companies charge fees for things such as recording fees, courier fees, notary fees, and others. These are not always standard charges or rates throughout the industry, so it can pay to shop around.
For this reason, as you reach out to different title companies as part of your shopping, don’t just ask what their title insurance fees are. Instead, make sure you have a list of all the fees you will be charged at closing so that you can have an honest comparison.
Lender’s Title Insurance at Endeavor Title
If you are searching for a lender’s title insurance policy, then Endeavor Title can help. Our title team has extensive experience in clearing titles so that you can move toward your closing quickly and hassle-free.
To learn more about lender’s title insurance, contact us today at 410-666-3780.