Buying a house is an event that happens only a few times in a lifetime for most people. It’s an exciting time and the more you know about the process and what to expect during closing, the more relaxed you’ll be going through it.
The American Land Title Association collaborated with the Designing Spaces television series to explain to home-buyers the Escrow closing process and the value of purchasing an owner’s title insurance policy.
In most Washington’s standard real estate contract language, there is a provision that obligates to the seller to purchase a title policy that will benefit the buyer. And with any home loan, the lender will require the buyer purchase a policy that will benefit the lender. Unlike escrow services the fee is not split down the middle, but each party pays the fee that is associated with their obligations.
Additionally, there are different policies available that offer different levels of coverage. Your local agent will guide you on the industry recommended policy based on the transaction. For example, if you are buying a home in a suburb with fairly apparent property lines, I would recommend an ALTA (American Land Title Association) Homeowner’s policy. If you were purchasing premium waterfront or commercial property, I would recommend a slightly more expensive policy called the Extended Policy. If you were refinancing, you would probably purchase the lowest coverage policy known as the Standard Policy. Confusing? Absolutely. All the above being said, a real estate agent is not an expert at title insurance and you can and should call the customer service number for the title company you are using and seek clarification for any questions you might have.
Lastly, the title fee is a sliding scale fee based on the purchase price for your home. You can see a sample rate fee schedule here, but you should always ask for current rates based on your transaction.
The segment does an outstanding job of illustrating how the work done by title insurance professionals provides consumers peace of mind when purchasing a home.