Whatever the case, you have options as to where you can get your title insurance. This is going to be an important decision because a good title company can save you from current and future issues with your title.
But as is the case with all things in life — all of your options aren’t going to be equal.
You have options. There are plenty of title companies that can provide this essential service. A thorough and experienced real estate lawyer and title company will first provide a deep search of public records for any potential issues with the title. After that, they’ll offer insurance that will cover certain types of issues that could potentially arise in the future.
So how do you know if you’re working with a title company that fits your needs?
Here are the 7 questions you should ask your title company about title insurance:
- What Are Your Rates?
- Who Pays for the Policy?
- What Type of Issues Do You Cover?
- How Experienced Is Your Attorney?
- How Long Do You Spend on a Title Search?
- What Was Your Most Challenging Title Search and What Did You Do?
- Do You Offer Any Discounts?
1. What Are Your Rates?
As a consumer, you obviously don’t want to pay more than you need to. However, there’s always a balancing act between cost and quality. Try not to tip the scale too far in either direction.
Some states, including Tennessee, regulate what title companies can charge for title insurance.
These fees will be determined by the insurance company. Generally, a lender’s policy will relate to the amount of the loan, and a buyer’s policy will relate to the total purchase price of the property.
2. Who Pays for the Policy?
It might be assumed that the person purchasing the property will pay for the title insurance policy, but that is not always the case.
The title insurance company will be acquainted with the local customs relating to this practice. Some areas consider it customary for the buyer to purchase their own policy, while other areas will see the seller paying for the policy.
3. What Type of Issues Do You Cover?
Title insurance policies protect against issues with the title that are found after closing day.
Another title search will be performed when you eventually sell the property, for instance. And this brings up the possibility of finding previously-unknown issues with the title.
Your insurance policy should provide coverage when these situations arise. However, not every situation is covered by every provider. Ask the title company what they cover so you can compare it to other providers.
4. How Experienced Is Your Attorney?
Anybody who makes it through law school has an admirable amount of determination and intelligence. However, experience matters when it comes to working through complicated legal matters.
A brand new attorney isn’t going to have the breadth of knowledge gained through years of practice like a more experienced attorney.
You can ask the title insurance if their representation has applicable experience. Title insurance offers legal representation, and you should verify their offer is strong.
5. How Long Do You Spend on a Title Search?
The closing process can occasionally happen in a tight window of time. Some sellers are in a hurry to move from an accepted offer to signing papers, while others need time before finalizing the sale.
Title searches can be exhaustive processes. The amount of time it takes to complete this search, and how many years back the property is searched, will depend on the property as well as the title company.
You will need to find a company that can complete the process within the stated window of time.
6. What Was Your Most Challenging Title Search and What Did You Do?
There are some signs of how difficult your title search might be — new homes won’t have as long of a paper trail, for instance. However, you’re never going to really know until the title company gets in there and starts looking around.
It’s best to be prepared for the worst while hoping it doesn’t happen. Ask your title company about their most challenging issue and how they worked to resolve it. This will help show you how capable they are in providing this essential service.
7. Do You Offer Any Discounts?
And finally, ask your title company if they offer any discounts for purchasing both a lender’s policy and a buyer’s policy at the same time. Saving money is always beneficial, and it doesn’t hurt to inquire about the possibility of doing so.