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Owners policy on lot purchase

Posted by shiltsy (My Page) on
Tue, Jun 17, 14 at 23:28

We are two weeks from closing on a few acres of land for a future build site. It's a small development of 24 acreage lots. We are purchasing the lot from the developer and paying cash, so the owners title insurance policy is optional.

The title company is looking to charge $682 for an owners policy with $580 of that going to the agent and around $100 to the actual underwriter.

If we are already paying for the title search is the owners policy necessary? Is the fee negotiable since it looks like they are making a ton of profit as the agent?

Thanks for any feedback!

Follow-Up Postings:

RE: Owners policy on lot purchase

Do you know the history of the land? Who did the developer get it from? Previous owners - no nasty divorces? No contested wills? No bankruptcies? Did the developer pay the land engineers who laid out the subdivision? Anyone else who worked on the land? Who owned it before the previous owners? No ancient Indian burial sites?

Bottom line is most likely you will never need your title insurance. However, on the one in a million chance something came up and you list your land, can you afford that financial hit? If and when you build a house on it, will your house lender require title insurance on the land? If you loose your land, you also loose your house.

RE: Owners policy on lot purchase

I think to skip the purchase of title insurance would be penny wise and pound foolish.

RE: Owners policy on lot purchase

Insurance always seems like a rip off......til you need it. I would pay for it but I am not a big financial risk taker.

RE: Owners policy on lot purchase

Negotiate the price. That's ridiculous the agent is rec 85% and the actual insurer is 'only' rec 15%!!!!!!!! That's more than ridiculous!

RE: Owners policy on lot purchase

Thanks everyone. After reading a few horror stories, I quickly realized this policy is a small price to pay for peace of mind.

Now to negotiate something better.... It's pure principle, honestly.

RE: Owners policy on lot purchase

Agree 80% profit for writing agent is obscene - but what options are there? this seems like a scam that we just all go along with because we're overwhelmed.

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