New Home Title Insurance

[golfermike22]

My wife and I just bought a new home in the Pennecamp neighborhood. We are extremely excited. We plan on moving from the Boston area to the villages as soon as humanly possible.

With the purchase of the brand new home we are not sure if we need to purchase the title ins. It is a newly constructed home on a golf course, the name eludes me right now.

Has anyone ever needed to use this type of insurance? We only have a day or two to decide. The closing was today all done by mail.

[raynan]

We just moved down to Pennecamp in Sept from MA. We did not get the title insurance. 80% of villagers do not. We felt if we were on the outskirts or the border of another town we would need it, but we are not. We're originally from Somerville & Quincy but after marriage 33 yrs in Attleboro. How about you? We're on Markridge Loop surrounded by Jacaranda golf course. You? You will love it here. Congratulations!

[Challenger]

Not buying title insurance is generally a pennywise and pound folish move IMHO, especially if you do not have a mortgage. A home is the largest single investment most people will ever have . I have be involved with community banks for over fifty years and have seen large payoffs by title insurance companies. Sometimes this takes the form of defending the owner against unjustified claims. The premium is paid once and covers the insured for the duration of ownership. A small price to pay .

[Bill-n-Brillo]

Ditto what Challenger said.

It's insurance - pure and simple. A complete waste of money............until something comes up and you wish you had it! :)

What are the chances of such a situation happening? In TV, it's probably slim. But it comes down to whatever helps you sleep well at night.

Me? We'd never buy property and not get title insurance for it.

Bill

[Army Guy]

Add another one to better safe then sorry! We thought as others, said small price for piece of mind!

Army Guy

[golfermike22]

Thanks for all the replies. I spoke to the sales rep. He of course could not advise me however he mentioned it states in the deed that the title is free and clear. I guess I was more worried about any border disputes with neighbors but I only have one since all other sides are on the golf course and the street.

By the way Raynan, my wife grew up in the Cambridge/Somerville area. We lived on Line St. in Somverille for a few years before moving to Norton.

I need to get a picture or avatar. We'll do that soon. My wife is constantly on facebook so I need her to get started on TOTV.

[mulligan]

Land ownership disputes can come from a wide variety of unexpected sources. When you consider that some of the original survey work in Florida pre-dates the civil war, title insurance is a cheap remedy for what could be an expensive court battle.

[784caroline]

We did NOT get Title insurance......Our thought was this was a new home and it was all pasture and farm fields. HOwever what we did get at settlement ...and you have to ask your agent for this.....is a Contractors Sworn Statements to Owner and Final release of Liens. The document i received identifies 30 subcontractors who built my house and all have signed the release and it has been notarized. Again this document has to be prepared in advance to get all the signatures...but The Villages Closing Department will do this!

[Russ_Boston]

By the way Raynan, my wife grew up in the Cambridge/Somerville area. We lived on Line St. in Somverille for a few years before moving to Norton.

Mike,

I live off Oak between TPC and NCC. Small world! Just bought a house in Buttonwood.

______

Sorry for the hijack!

[skyguy79]

I would never go without protecting my property investment by going without the title insurance. It's not unheard of for a property grab to take place for personal gain in the name of ancestorial rights, and I would never-ever trust the courts to protect me from the litigious slight of hand that could ultimately render me bankrupt and homeless!

[downeaster]

I would never go without protecting my property investment by going without the title insurance. It's not unheard of for a property grab to take place for personal gain in the name of ancestorial rights, and I would never-ever trust the courts to protect me from the litigious slight of hand that could ultimately render me bankrupt and homeless!

I couldn't have said it better.

A bit of advice for those who choose not to have title insurance. Don't advertise the fact you have no title insurance. You could be the target for a land grab skyguy mentioned. You are probably spending thousands each year insuring your life, health, car, golf cart, house, etc., so spend a few bucks more and insure your property.

To be fair, I am an insurance guy. I like the peace of mind it provides. It is not that I don't gamble but I like to hedge my bets.

[Russ_Boston]

Just closed a few days ago and purchased the owner's portion of the title ins. I already had to pay for Citizens portion anyway since it was mortgaged. The extra amount was about $325. Wrestled with the idea for awhile but went for the peace of mind.

[Shimpy]

Just closed a few days ago and purchased the owner's portion of the title ins. I already had to pay for Citizens portion anyway since it was mortgaged. The extra amount was about $325. Wrestled with the idea for awhile but went for the peace of mind.

Piece of mind is very comfortible to have. You never have to worry about a Seminole indian making claim to your property. I got the insurance and for what you pay as compared to what your property is worth is a small price to pay. JMHO

[Maryland Girl]

It appears the reason some people don't want to buy title insurance is because of the cost. It also appears that there is a huge discrepancy between posters on what they are paying for this coverage. We checked the rates for Florida on the internet and found the following:

$0-$100,00 - $5.75 per $1,000
Over $100,000 up to $1 Million - $5.00 per $1,000

Title insurance for a new home purchased for $250,000 and financed would cost $1325.00. :ohdear:

Steep but worth in it for the peace of mind.

[Russ_Boston]

It appears the reason some people don't want to buy title insurance is because of the cost. It also appears that there is a huge discrepancy between posters on what they are paying for this coverage. We checked the rates for Florida on the internet and found the following:

$0-$100,00 - $5.75 per $1,000
Over $100,000 up to $1 Million - $5.00 per $1,000

Title insurance for a new home purchased for $250,000 and financed would cost $1325.00. :ohdear:

Steep but worth in it for the peace of mind.

That's about right but most of my cost was forced on me because I mortgaged. About $1000 for their coverage and $325 for mine.

[skyguy79]

That's about right but most of my cost was forced on me because I mortgaged. About $1000 for their coverage and $325 for mine. Russ, I think you switched those figures, but I do concur with what you've stated. I checked my paperwork and got figures similar to the post you quoted... just higher on my purchase. (a Gardenia)

[Boomer]

Not buying title insurance is generally a pennywise and pound folish move IMHO, especially if you do not have a mortgage. A home is the largest single investment most people will ever have . I have be involved with community banks for over fifty years and have seen large payoffs by title insurance companies. Sometimes this takes the form of defending the owner against unjustified claims. The premium is paid once and covers the insured for the duration of ownership. A small price to pay .

We are spending time in TV, off and on, as we decide if buying a second home is what we really want to do. We are not there right now, but when I saw this thread appear, I thought it could be an appropriate place to make a suggestion.

First of all, I completely agree with Challenger's post. In fact, Challenger has used a phrase that I often find myself using to describe pickles that people can get themselves into. "Penny wise and pound-foolish" Another phrase I use when thinking through financial decisions is "What is the cost of sleep?" (answers will vary on that one)

Sometimes people are so happy with being able to pay cash for a home that they forget to stop and think through the title insurance issue of bank requirement. No mortgage. No bank. Yay! But......cash buyers sometimes forget that when you pay cash, you are the bank. You need to think like a bank.

I hope I do not come off as heavy-handed when I start in on these topics. Generally, what I try to do is to help those who might be interested in finding more information to consider before they make big financial decisions. (And I always include my disclaimer to let you know that I have no pieces of paper that say I am a financial adviser and could even be an English major for all anybody knows.) For some reason, I have, for many years, had a pretty decent comfort-level with making financial decisions. I hope I stay that way, but who knows. These things I write are only for your consideration. I hope I never sound like I am trying to act like I know everything because I sure don't. But I digress.....

So anyway, here is what I want to suggest to anybody who's into learning more about what they might not know about financial stuff....

One day when we were in TV, I saw an ad in the paper for a law firm that was offering a little seminar on FSBO's and other real estate topics that included title insurance. Well, I thought it sounded interesting so I signed up. When I got there, I found that there were other topics covered, too. The topics included trusts and other things that pertain to financial life. Pre-nups came up. They also talked about things that those who live together as committed, loving, though unmarried, couples need to know about how financial matters can affect them -- but maybe not in the way they thought they had planned.

Good info was presented and also they addressed some of those "penny-wise and pound foolish" decisions that people make while thinking they know what they don't know. One had to with titling your house with an adult-child or someone who would be an heir. (Doing so possibly could introduce extremely serious risk to the asset while the real homeowners are still alive. But people do this all the time thinking they are avoiding probate or taxes or whatever I guess. But it should not be done without seeking good legal advice first to learn about the risks that could be involved.)

And a long time ago, I started a thread here where we discussed pre-nups. So, of course, I thought that was interesting.

So anyway, I am not a financial adviser nor am I a lawyer. (although I sometimes wonder if I could have been going to law school for the past 3 years instead of sitting here posting on TOTV. I would have been taking the bar by now probably. :D ) I digress once more.....

Back to the seminar.....There were different attorneys who spoke on the various topics. It was time well-spent. A lot of information in a relatively short time period.

So if you see an ad in The Daily Sun for one of these seminars, I suggest that if you are interested in learning more about this stuff, sign yourself up. The office was located north of TV on 441 somewhere close to a Lutheran church as I recall.

Nobody tried to pressure anybody about anything. They were just making their services known.

Also, as a little added bonus, while we were learning all kinds of things from the attorneys who were speaking and answering questions, Mr. Boomer was especially happy because we were sitting near the table where they had some wonderful cookies for us.

So anyway, just a suggestion. I am recommending the seminar. I have not used the attorneys. Of course, they are into title insurance there, but they explain some good reasons for it. Surveys anyone?

And, Challenger, I am a big fan of those good, solid, community banks who did things right throughout this mess that continues to grow arms and legs reaching into so many aspects of our economy. I am a small investor in individual stocks. I welcome a good market, but I also strongly believe that "Unrestrained greed is not only bad morals, it's bad economics." (I think I just digressed again.)

Boomer

[Sherman931]

Bought the Title Insurance...with all the publicity (good and bad) that the Morse family gets....well, you never know.

[JimJoe]

Before you close, does not the owner have to produce to the buyer's lawyer an UPDATED abstract of the property that proves their ownership and that it is clear from liens? Doesn't The abstract becomes the property of the new owner upon closing? Do you not have a lawyer examine it to make sure that the seller has free and clear title? Does Florida have a "root of title" law that only requires the owner to prove title only back a specific number of years because all ownership claims older than that are barred by the root of title law? When you get the title opinion letter from YOUR lawyer saying the seller has clear title and there are no current liens on the property, what is the need for title insurance, especially since the lawyer should have malpractice insurance to cover such mistakes?
I am not familiar with Florida. Can anyone clarify this with their knowledge and experience?

When I buy in TV I will have a Florida real estate attorney check all the documents including the title to the property, and give me a written opinion.

[skyguy79]

Before you close, does not the owner have to produce to the buyer's lawyer an UPDATED abstract of the property that proves their ownership and that it is clear from liens? Doesn't The abstract becomes the property of the new owner upon closing? Do you not have a lawyer examine it to make sure that the seller has free and clear title? Does Florida have a "root of title" law that only requires the owner to prove title only back a specific number of years because all ownership claims older than that are barred by the root of title law? When you get the title opinion letter from YOUR lawyer saying the seller has clear title and there are no current liens on the property, what is the need for title insurance, especially since the lawyer should have malpractice insurance to cover such mistakes?
I am not familiar with Florida. Can anyone clarify this with their knowledge and experience?

When I buy in TV I will have a Florida real estate attorney check all the documents including the title to the property, and give me a written opinion.Is this your first home purchase? All this assumes that once you're closed that no unknown entity can then come in, file suit for the land then obtain a favorable verdict from the courts. And you know what they say about assume!

[JimJoe]

Is this your first home purchase? All this assumes that once you're closed that no unknown entity can then come in, file suit for the land then obtain a favorable verdict from the courts. And you know what they say about assume!

I guess I would rather know I have good title and no liens, a legal opinion and their malpractice insurance backing it up, and the protection from lawsuits that a root of title law provides, than assume some title insurance company will still be in business 20 years from now when a problem arises, and they will comply with their insurance contract.

[skyguy79]

I guess I would rather know I have good title and no liens, a legal opinion and their malpractice insurance backing it up, and the protection from lawsuits that a root of title law provides, than assume some title insurance company will still be in business 20 years from now when a problem arises, and they will comply with their insurance contract.I think you're missing my point, being that even the clearest of titles and the best of legal minds cannot forsee the forseeable or research for what was created prior to governmental records being kept... and no malpractice insurance is going to pay for any such incidences. Also, what makes you think that there will be a law firm still existing or any malpractice insurance you're refering to 20 years down the road any more than there will be that title insurance company? If betting on this, I'd certainly not put my money on the law firm existing and the title insurance company not - come 20 years down the road!

[JimJoe]

I think you're missing my point, being that even the clearest of titles and the best of legal minds cannot forsee the forseeable or research for what was created prior to governmental records being kept... and no malpractice insurance is going to pay for any such incidences. Also, what makes you think that there will be a law firm still existing or any malpractice insurance you're refering to 20 years down the road any more than there will be that title insurance company? If betting on this, I'd certainly not put my money on the law firm existing and the title insurance company not - come 20 years down the road!

The law firm would not have to still exist.. you would sue the lawyer and he would notify his insurer.... so it is an insurance carrier either way.. but I would have an abstract and opinion that I could examine and analyze before I closed.. information is always better than just an insurance contract... and the title opinion is usually not much money.. $100 or so.. because if there is a root of title law, you look at the abstract, find the root based on the sales and time periods, and it usually is pretty obvious if the seller has good title.

I have no problem with title insurance if you think you need it for peace of mind.. but realize all you are doing is paying a pile of money to an insurance company for their promise to pay IF something unlikely happens, and the right to sue them if they dont pay,, all assuming they are still in business years or decades later. I would rather have the title researched, have an experienced real estate attorney look at it and, and show me and put in writing why the seller has good title.
Keep in mind most of these properties have in their title history the developer's corporation. Do you think they checked out the title before they bought the land? I am thinking yes.

[skyguy79]

I guess I would rather know I have good title and no liens, a legal opinion and their malpractice insurance backing it up, and the protection from lawsuits that a root of title law provides, than assume some title insurance company will still be in business 20 years from now when a problem arises, and they will comply with their insurance contract.What would "their" malpractice insurance back up, that there was no existing documentation available at the time of the title search? That evidence that did exist was not uncovered or discovered prior to the title search? Also, what makes you think that the malpractice insurance company might still be there 20 years from now any more that the title insurance company might not? If I were to bet, I'd bet that the malpractice insurance might cease to exist before the title insurance ever would!

[Pturner]

Hi Golfermike,

Welcome to TOTV and welcome to The Villages. Congratulations on your new home here!

I agree with all those who said to get title insurance. In addition to the excellent points already raised, I'll offer another thought. It might or might not be a valid concern, but in case it is, I'll throw it out:

One day, you or your heirs might want to sell your home here. (Maybe you'll want a bigger or smaller one or a different view or whatever.) The new owner will not be the first owner and will want title insurance. I don't know whether you're having had an insurance company do the appropriate independent research and issue insurance would help the next owner get title insurance. But if it would, that's something else to think about.

Does anybody know whether a future owner's ability to get title insurance would be affected by the previous owner having cleared and insured the title?

[JimJoe]

What would "their" malpractice insurance back up, that there was no existing documentation available at the time of the title search? That evidence that did exist was not uncovered or discovered prior to the title search? Also, what makes you think that the malpractice insurance company might still be there 20 years from now any more that the title insurance company might not? If I were to bet, I'd bet that the malpractice insurance might cease to exist before the title insurance ever would!

I agree that it is insurance companies both ways.. but my way there is also the lawyer's research, explanation to me before I close, and the lawyer's deep pockets.. and possibly his firm's deep pockets. It is possible the abstracting company could make a mistake and you'd have them to go after also.
I don't know about the real estate law here... but when I buy, if there is an updated abstract, and a title opinion letter, I will not buy title insurance.
I seriously doubt that out of the 40,000 or so homes in TV now, there has ever been a title problem, other than an unpaid lien that was cured prior to closing.
Do you really think the developer would have bought all this land, built all these houses, all without checking out the title to the land? I would be much more concerned about seller liens than title problems, and with an updated abstract, you should know that before you close.

[Challenger]

We are all free to make choices. For the relatively small premium involved in relation to the investment I'm buying the Ins. Caveat Emptor

[skyguy79]

I agree that it is insurance companies both ways.. but my way there is also the lawyer's research, explanation to me before I close, and the lawyer's deep pockets.. and possibly his firm's deep pockets. It is possible the abstracting company could make a mistake and you'd have them to go after also.
I don't know about the real estate law here... but when I buy, if there is an updated abstract, and a title opinion letter, I will not buy title insurance.
I seriously doubt that out of the 40,000 or so homes in TV now, there has ever been a title problem, other than an unpaid lien that was cured prior to closing.
Do you really think the developer would have bought all this land, built all these houses, all without checking out the title to the land? I would be much more concerned about seller liens than title problems, and with an updated abstract, you should know that before you close.I don't disagree with a lot of what you say, but at this point I would only strongly suggest that you discuss this with your attorney before you decide on not buying the title insurance. Without it you would probably be safe, but there is always a small chance something could go wrong later on, and that small chance is what the title insurance is all about. Good luck on finding a nice home!

[JimJoe]

I don't disagree with a lot of what you say, but at this point I would only strongly suggest that you discuss this with your attorney before you decide on not buying the title insurance. Without it you would probably be safe, but there is always a small chance something could go wrong later on, and that small chance is what the title insurance is all about. Good luck on finding a nice home!

Thank you very much!
JJ

[Russ_Boston]

Russ, I think you switched those figures, but I do concur with what you've stated. I checked my paperwork and got figures similar to the post you quoted... just higher on my purchase. (a Gardenia)

No I got them right. My optional cost to cover me was $326.56 to be exact. This is for a Begonia.

The cost that I was obliged to pay for Citizens First Wholesale Mortgage title was just over $1100.

[skyguy79]

No I got them right. My optional cost to cover me was $326.56 to be exact. This is for a Begonia.

The cost that I was obliged to pay for Citizens First Wholesale Mortgage title was just over $1100.That's interesting! In the papers we needed to sign and return to the bank, page 2 of the GFE (Good Faith Estimate) has the following:

4. Title services and lenders title insurance: $599.75
5. Owner's title insurance: $1,397

Either way the bottom line is probably the same, but I wonder why the owners portion on mine was much higher while on yours it's much lower? Perhaps it just the mysterious magic of mortgage documentation and proceedural processing where Philly Lawyers are needed to make any sense out of it all! :22yikes:

[mgm4444]

My first question: Post #8 (Caroline) got a Contractors Sworn Statements to Owner and Final release of Liens -- Is this for new homes only?

I'm from NY. Seems like the legal aspect of buying/selling homes in Florida is alot easier there. (It boggles my mind people do this by mail!!) On buying a pre-owned, either by VLS or MLS, all cash or mortgaged, where do you start to look for a lawyer in Florida to help you with all of this? My experience with real estate attorneys was something to be desired and I swore I would never put myself through that again.... of course, I never heard of The Villages back then.

[784caroline]

This statement I received was for a NEW home being bought fom the villages. If I were buying a resale home, my thought process on the need for title insurance would be totaly different. When buying from a private party you really have no idea of what work was done or the name of contractors used in performing such work. Also the risk increases that the title can be tainted in some way (even in a short period of time since it was originally bought) when you are not buying it from the developer...although this risk is still very very low, it does exist. I imagine in a resale contract you could add words (unless something like this is already included in a standard FLorida residential resale contract) to the effect that no known contractor liens exist on the property identified in this contract.

My original point on the need for title insurance is:
--- If you are buying directly from the developer, and paying cash where you donot have a bank requiring you to pay $1,000-1500 for lender title insurance....the chance of something going wrong is extremely remote. If however by not buying title insurance you will not be able to sleep at night..go for it.
--- Compare this senario to buying from the Developer and financing a loan where you are already required to buy Lenders title insurance, your additional cost for buyers title insurance would be minimal. (Again be careful for this would only cover you for the Mortgage loan amount NOT the entire house)
--- The other senario is buying a resale home whether you are financing it or not, how comfortable are you knowing the title chain...this is where you are most likely to buy title insurance.

We settled by mail and it was the easiest closing process we ever went through...much easier than selling the house up north. The key thing is that you must meet The VIllages timetable (ie deposits, any financial committments, and closing dates) laid out in the contract you signed and that was made clear to you.... otherwise you can run into a hassle. I mean simply chaning your closing dates one or 2 days either way from what is stipulated in the contract will most likely cost you additional money and some hassle.

Remember this is a business proposition.....The developer is not your friend, BUT also know they donot want to make enemies. The contract is the contract!

[Bill-n-Brillo]

My first question: Post #8 (Caroline) got a Contractors Sworn Statements to Owner and Final release of Liens -- Is this for new homes only?

I'm from NY. Seems like the legal aspect of buying/selling homes in Florida is alot easier there. (It boggles my mind people do this by mail!!) On buying a pre-owned, either by VLS or MLS, all cash or mortgaged, where do you start to look for a lawyer in Florida to help you with all of this? My experience with real estate attorneys was something to be desired and I swore I would never put myself through that again.... of course, I never heard of The Villages back then.

Re: Contractors' Statements - That'll only apply to new builds, the concern being that you'd want to ensure there are no liens on the property from anyone involved in the construction process that might not be filed with the county yet. A title search will cover the potential for finding any liens on an existing house/property.

Re: Finding a real estate attorney - We used McLin Burnsed (the office in LSL) to handle our recent closing (at the suggestion of the sellers). It was a FSBO deal - no realtors involved. The firm had us (as buyers) and sellers fill out forms that addressed pertinent info necessary in order to draw up a sales agreement/contract. They also handled all the other aspects of the closing - - - except for arranging things like a home inspection, termite inspection, and the like. Those kinds of things are at the discretion of the parties involved in the sales contract - I guess some people might not want to have them done but I wouldn't know why! :) Anyways, those were a couple of things we wanted to have as buyers so I arranged for them and paid the companies for their services directly. But know that in this type of an arrangement, the law firm is not representing either party. They're simply agents for preparing the documents and ensuring a complete process. They're not going to offer advice or consultation to either party. Also, as a caveat: Make sure you thoroughly read all documents to ensure that they've got all of your information properly noted throughout. Trust me on that one! :) The whole process worked out just fine for us in the end - it accomplished what we all wanted.

Hope that helps!

Bill

[golfermike22]

Mike,

I live off Oak between TPC and NCC. Small world! Just bought a house in Buttonwood.

______

Sorry for the hijack!
It is a small world. I've seen some of your other posts. Congratulation on the buttonwood house. I'm not sure if you are still up here in the frigid tundra. Do you ever go to Alberto's?

[Russ_Boston]

It is a small world. I've seen some of your other posts. Congratulation on the buttonwood house. I'm not sure if you are still up here in the frigid tundra. Do you ever go to Alberto's?

Sometimes. But for pizza we actually go down to Twins in N. Prov. We're still here in Norton until 2012 sometime. But we'll be visiting the TV home often.

[natickdan]

My wife and I just bought a new home in the Pennecamp neighborhood. We are extremely excited. We plan on moving from the Boston area to the villages as soon as humanly possible.

With the purchase of the brand new home we are not sure if we need to purchase the title ins. It is a newly constructed home on a golf course, the name eludes me right now.

Has anyone ever needed to use this type of insurance? We only have a day or two to decide. The closing was today all done by mail.

I am risk averse and, for me, paying for Title Insurance is a no-brainer. At this point in my life, it's worth the peace of mind.