Closing costs question - SW FL

stir_fryiDecember 10, 2012

In my parent's county in SW FL, the seller customarily gets stuck with much of the closing costs.

My question is -- in an all-cash transaction -- is it reasonable for them (the seller) to refuse to pay for title insurance for the buyer, if the buyer requests it? Parents (sellers) are original owners and never had a mortgage if that matters.

Since it is all cash and not required, why should they pay for it?

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RooseveltL

Title Insurance is not a responsibility of the seller typically. It is the buyer and his/her lender to assure there are no liens or claims on the property before purchase. I would think the buyer wants to cover this cost unless it is specified in the sales contract.

BTW - The seller may wish to pay for closing cost/settlement which can be handled via the title insurance company which might clarify the issue at hand.

    Bookmark   December 10, 2012 at 5:24PM
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sylviatexas1

Paying for title insurance is technically negotiable, but here it's almost always a seller item.

Without title insurance, the buyer assumes the risk of problems in the future, things like former spouses, children or other heirs, judgments from workmen or contractors, unpaid taxes, assessments for sidewalks, fines for improvements done without proper permits.

The idea is that it's up to the seller to provide assurance that the buyer will actually own what he's paying for.

    Bookmark   December 10, 2012 at 6:28PM
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weedyacres

In these here parts (midwest), title insurance typically goes on the buyer's side of the settlement statement. If the parties have negotiated for the seller to pay any closing costs, that amount is credited as a lump sum on the buyer's side of the settlement statement.

There is some title work on the seller's side, for abstracting fee and state tax stamps, but that's it.

    Bookmark   December 10, 2012 at 6:55PM
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kirkhall

I would say, if it is customary in your area, and you choose not to, are you willing to lose the sale? It is really a pretty small amount of money. And, if it really bothers them, they can counter for x dollars more than the offer price to cover the fee.

    Bookmark   December 10, 2012 at 7:49PM
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rrah

This varies from area to area. In this midwestern state, the seller typically pays for the title search and pays for the buyers title insurance. The buyer pays for the secondary policy (bank policy) when required.

    Bookmark   December 11, 2012 at 7:31AM
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