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Several Title Fee Questions

Posted by marita40 (My Page) on
Sun, Jul 27, 14 at 8:30

I noted on the Purchase Agreement for the house I am buying that title fees are paid by the buyer. This appears to be standard contract language and thus non-negotiable. However, the last time I bought a house, in 2008, title fees were split between the buyer and seller. This was purchased with a different real estate company. Looking back at the purchase agreement, I see that this was also written into it and non-negotiable. So my question is, does the question "who pays for title insurance?" depend on the real estate company? Or is it determined by local or state law? I am in MN.

My second question concerns what exactly I should, or need to, purchase in terms of title insurance. I am getting a mortgage so I understand that my lender requires title insurance. However, it appears I'm also being asked to purchase owner's title insurance over and above this. Do I need it? is it a good idea?

Specifically, here are the fees I just received from the closing company:

Title Services (HUD line 1101)
1. 2006 ALTA Loan Policy --Title Resources Guarantee Co: $767.50
2. Buyer Closing Service Fee: $300.00
3. Title search and exam Fee: $600.00

Owner's Title Insurance Options (HUD line 1103)
1. 2013 ALTA Homeowners Policy $391.25
2. 2006 ALTA Owners Policy: $295.00

I understand that I have a choice between the two Owner's Title Insurance Options above. But if my lender is requiring title insurance, why would I want a separate Owner's title policy?

Thanks! Just trying to understand what all this means and what is best to do.

Follow-Up Postings:

RE: Several Title Fee Questions

As I understand it, the lender's title insurance generally only protects the amount of the loan, or the lender's interest in the property. If you want to protect your interest in the house, should a title problem arise, you will need an owner's title policy. The owner's policy is in effect for as long as you have an interest in the house. Remember, as you pay off a home's loan, your interest amount increases and the lender's interest decreases.

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