Secrets to Massive Savings on Title Insurance

Learn all about titles insurance and how it can protect your commercial real estate. Title insurance is an insurance policy that covers you for past events, rather than future events, on real estate properties. It may seem odd to take out insurance against past events on your property, especially since you will already have used a title search to weed out any noted problems in the past 50 years that may stand in the way of your future plans, and progress for the property. Title searches are usually performed by attorneys, or title companies. The property is searched back over a 50 year period, to trace the past owners, and the public records that relate to the property. Your title search will notify you of any problems with the property, such as outstanding liens attached to the property etc. The problem with a title search is that the records kept on real estate properties are done by humans, and are subject to human error. Additionally, there can be problems that surface some time later, after the search has come up clean, such as finding out that the documents, or signatures on the deeds have been forged. It is because, as a minute possibility of these types of circumstances occurring, that it is in your best interest to take out a title insurance policy against a property. Title Insurance Policies Title insurance policies are unlike many usual forms of insurance. As mentioned before, it is protection in the event of past problems with the title, which may end up costing you money. The good news is that you pay this insurance policy once, in one installment, and then you are protected. Once paid for, you are not required to continue paying monthly installments for title insurance on that particular property. Once you have title insurance, the title insurance company you have chosen will defend any claims put on the ownership of the property, and pay for damages arising that would usually end up costing you money. A typical policy will pay up to the full value of the insured property. There are a few things that must be remembered when taking out title insurance. There are exceptions such as claims that are made when the owner has prior knowledge of a problem with the property. The best way to benefit from title insurance is to be up-front and honest with the title insurance company from the beginning. If you think there may be a chance of potential problems resulting in a claim, tell the company immediately. If you fail to disclose this information to the title insurance company, you run the risk of being denied protection, and payment for damages because of the undisclosed events you have failed to bring forward. How To Save On Title Insurance As you are already aware, it is a dangerous scenario not to have title insurance on your property. Just because it is an important requirement doesn’t mean that you have to pay a lot to have it. There are some ways that you can save money on title insurance policies for your properties, and we will cover some of these money saving tips now. Re-Issue Rate When you take out title insurance, it works on a system of its own. The longer that you own a property, the larger the risk is that something could have gone wrong. So working with those odds, it only makes sense to say that the shorter the time that you have a property means there is less chance of something going wrong. With that in mind, if you are buying a property, and intend to sell it within a short space of time, lets say within a four month period, the chances of anything changing, or going wrong in that space of time would have to be very slim. In this case, you can ask the title insurance company for a re-issue rate. The re-issue rate is usually a discount of around 40% on the title insurance policy, and the reason why it is offered at this low rate is because if any claims come before the next owner, they are already covered in the next policy. Hold Open Policy A hold on policy is available to those who intend to sell a property within a year. If you are planning to re-sell the property in under a year, ask your title insurance company for a hold open policy to save you a substantial amount of money on title insurance. Basically, this particular policy has a fee of around 10% and the insurance company will hold a commitment to the policy for a year or more. When this happens, they are issuing you a policy on the second transfer, which is from you to the buyer, rather than from the seller to you. The reason this will save you money in the long run is that, traditionally, the seller pays the title insurance on the property, so you pay 10% when you buy the property, and save 90% when you sell it. Commercial real estate success depends a lot on you doing your homework, and understanding legalities, and how to protect yourself, and your investments. With that in mind, it is important to your success, to take the time to learn more about the legalities that surround property titles, and the different types of packages that are offered by title insurance companies. By knowing what suits your circumstances the best, you can tailor insurance needs to suit your particular situation, and by doing this you are guaranteed to save yourself money.

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