You understand the need for title insurance to ensure that no liens, encumbrances or mistakes create issues with the title to the commercial real estate you want to purchase. However, R Street notes that it is common for residential and commercial real estate buyers to overpay for title insurance premiums and fees. In fact, that nonprofit organization estimates that the excess totaled around $155.3 million in 2015 alone.
The law gives you the right to shop around and choose your own provider of title insurance. You may also qualify for discounts and reduced rates.
Title Insurance Rate Service Association
The New York State Department of Financial Services licenses the Title Insurance Rate Service Association. Title insurance companies that are members of TIRSA submit their proposed rates and rules, and TIRSA publishes a rate manual that includes all those rates, rules, policy type descriptions and endorsements.
Rate reductions
If title insurance companies are issuing an owner’s policy and a lender’s policy at the same closing, you may qualify for a reduced rate based on the Simultaneous Mortgage Rate. You would pay the full price for the owner’s policy, and then the lender’s policy would be 30% of the mortgage loan rate that applies.
Premium discounts
Perhaps you are planning to refinance in a few years. At that time, you will likely need a new lender’s policy. If you are within 10 years of the purchase of your first policy, and the ownership and property are the same as the original purchase, then you qualify for a refinance or subordinate mortgage, which is a discounted premium.
