Title Insurance and Title Reports: Don’t Be Afraid to Ask Questions

title insurance

As previously indicated, some of the attorneys at OWM Law (including yours truly!) are title agents for Fidelity National Title Insurance Company. In addition, we have a Title Coordinator and Title Assistant whose number one priority is helping the attorneys and their clients with real estate transactions, title searches and closings, conveyancing, etc. We provide “added extra value” to our real estate buyer clients by also providing them with title insurance, and conducting real estate closings. We utilize the same title insurance premium rates that all other licensed title insurance agents apply, while, at the same time, being more than competitive with all of the other real estate closings costs (i.e. notary fees, document preparation, fax transmissions, wire costs, etc.). During the course of our legal representation of real estate buyers, and the provision of title insurance, we provide the client/title insurance customer with a Title Insurance Commitment (i.e. title report). We encourage our clients, and title insurance customers, to feel comfortable to ask any and all questions that they have regarding what is usually the biggest purchase in their lives (i.e. their home or a real estate investment). Amazingly, a lot of real estate buyers never ask us anything about the title report.

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Veteran Pension Benefits: New Rules Released from the Department of Veterans Affairs

va pension benefits

On September 18, 2018 the long-awaited final rules were released by the Department of Veterans Affairs (VA) regarding pension benefits. The VA Pension is a needs-based benefit for Veterans that served during a period of wartime and spouses of deceased Veterans. The new VA rules dramatically change the current asset and income qualification rules for Veterans applying for pension benefits.

There are several changes to the pension benefit qualifications; however, the two changes that I want to highlight are (1) the imposition of a look-back period and penalty for gifts and uncompensated transfer; and, (2) a change to the requirements for income and assets, which the VA refers to as “net worth”. …

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Retaining Your Individualized Education Program (IEP)

iep

Many families have children who require an Individualized Education Program (IEP) or a 504 Plan while their children are of school age.  There are many reasons why one may be needed involving emotional and physical issues that a child has in trying to optimize their education.  A plan is necessary and very helpful in obtaining services for students while in school.

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OWM Blog – Do I Need Title Insurance? | Title Insurance in PA

How to Know if you Need Title Insurance in PA

title insurance in pa

As a lawyer handling real estate transactions, as well as a title insurance agent for Fidelity National Title Insurance Company, buyers often ask me if I really “need” to buy title insurance.  The answer, like most legal issues, is not as clear…in essence, it depends!

Conventional Lenders

Quite simply, the answer to the question “Do I need title insurance?” is dictated by your lender if you are financing the purchase price of the property.  Quite simply, a “conventional lender” is almost always going to require title insurance as a condition of obtaining the loan necessary to either purchase the subject real estate or to refinance any or all of the indebtedness (i.e. loans, judgements, etc.) associated with the subject real estate.  The conventional lender is going to require that the borrower purchase title insurance with coverage at least equaling the amount of the loan, as the lender is going to want insurance that their loan is secured by a mortgage against the proper real estate parcel, the mortgage is recorded against the proper real estate parcel, and the lien position of the mortgage is in, usually, first position.  For example, you may be buying a $200,000 property and financing $150,000 of that purchase.  As a result, the conventional lender will require that you buy title insurance with a coverage for the lender in at least the amount of the mortgage (i.e. $150,000).  The borrower/ buyer does not have to purchase $200,000 worth of title insurance; just enough title insurance coverage to insure the $150,000 mortgage.  However, the cost of buying the additional $50,000 worth of title insurance, for a total of $200,000, is nominal and the $200,000 title insurance policy will cover both the owner and the lender.

Private Lenders

There is always a chance that the lender will not require title insurance; however, almost all “conventional lenders” (i.e. banks, mortgage companies, etc.) will require title insurance.  A “private lender” (i.e. investor, family member, friend, etc.) may not bother requiring title insurance.  When we represent private lenders, we always recommend that they require that the borrower, as a condition of the loan, purchase title insurance as we want to make sure that our client’s loan is a secured mortgage that is in first position and is properly recorded against the correct real estate parcel.  However, that private lender certainly has the option of not requiring title insurance.

What If I Pay with Cash?

Finally, someone buying real estate with “cash” (i.e. not requiring any kind of financing) does not “need” title insurance.  That “cash buyer” has the option of buying title insurance. However, we almost always recommend that the buyer purchase title insurance as it is a relatively nominal expense in the overall context.  This is one of the biggest purchases you will make in your lifetime and the title insurance company will handle the entire transaction, the settlement agent will conduct closing, etc.  The only time that it makes sense to not buy title insurance is when you are getting ownership of a piece of property as a gift from a family member (i.e. grandma gifts her home to you, your parents transfer ownership of their investment property to you, etc.).

Do I “need” title insurance?  Hopefully, the above makes it clear that you only “need” title insurance when you are dealing with a conventional lender; when not, you should still purchase title insurance with few exceptions (i.e. a gift from a family member).

Do you have additional questions regarding title insurance in PA? Contact OWM Law today.

OWM Blog – Do I Need a Business Lawyer for My Small Business?

Small and start-up businesses may view retaining an attorney as an unnecessary expense, and one they cannot afford.  The cost of having an experienced business lawyer on board early, however, will outweigh the costs that may result if business issues are not handled properly.  A business attorney should be viewed as a potentially cost-cutting resource for your company, allowing you stay focused on growing your business.

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