Title insurance has wrinkles well worth knowing

(Flickr photo by mountainamoeba)

Two of the most important things you need to know about title insurance — and you need to know them — are these:

1. The percentage of claims is in the single digits;
2. The cost is high considering the risk, but New York State law bars discounting.

It also is worth knowing that there are two exceptions to the prohibition against discounting:

What if your title company is crooked?

Titleserv has closed the doors of its national headquarters in Woodbury, L.I.

Let’s say you bought an apartment or single-family house not long ago, and one of the nation’s biggest providers of title insurance issued your policy.  That company would be Titleserv, which has described itself as follows:

We operate in 47 states domestically as well as in select international markets and provide both residential and commercial services.

Established in 1986 in Woodbury, New York, Titleserv was founded on a fundamental premise – to be the title insurance provider of choice by offering the most reliable and comprehensive title insurance services in the residential and commercial industry. . .

Access to National underwriters allows Titleserv to provide the most competitive pricing coupled with boutique service.

When a title company runs into problems, you can be sure that you, too, will run into problems.  Read on. . .

As for Titleserv, does it intrigue you to learn that the company was raided by federal investigators suspicious about an alleged illegal kickback scheme several years ago and

It’s a mistake to yawn about title insurance

 

Fire in Bangkok last July (Flickr photo by ToGa Wanderer)

Do you have theft insurance? Fire insurance? Liability insurance?

Surely you do. If not, don’t tarry.

Those who are well insured have in all likelihood never had to file a claim for a fire lose; certainly few readers have.  (Actually, I had a weekend home destroyed in the 80s and was fortunate to have an excellent insurance company pay for its replacement cost, though not a 17-year collection of my photos.)

At a closing, few may wonder why they need title insurance. One reason is

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Pending rules aim to hold lenders to their word

A form that everyone in the real estate world knows as a HUD-1 details every cost to the seller and buyer at settlement.

The law requires that the lender furnish the form at least a day prior to closing, but there is no penalty for their failure to comply.

In most jurisdictions, lenders struggle to provide the form in time and almost invariably do so.  In Manhattan, however, the law is overwhelmingly more honored in the breach than in the observance of its requirements.

Around a closing table last week,