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You’re buying a home in WA State, and the question of title insurance comes up. Who is on the hook for this cost, the buyer or the seller?
Title insurance is a unique type of insurance that protects homeowners and lenders from costs relating to title claims or disputes. In Washington, as in many states, it is usually the seller who pays for the buyer’s title insurance policy, while the home buyer is typically responsible for purchasing the lender’s policy. However, this can vary.
Whenever a home is bought or sold in Washington, government officials will create a record of that transaction. These records are generally filed in the public archives. In some cases, a house might also have records relating to liens, levies, or other events that affect the ownership of the home.
As a home buyer, the last thing you want to do is purchase a house that has some kind of claim or dispute associated with it. You want to buy a house that is “free and clear.” And that’s where title companies come in.
When you purchase a title insurance property for a home you are buying, the title company will closely examine all available records pertaining to the property. Specifically, they are looking for potential ownership issues, and they will attempt to remedy any issues they discover.
Despite the thoroughness of this process, there is always a chance that problems could arise later on down the road. And that’s where the title insurance policy comes into play. This special type of insurance offers some degree of protection from financial losses stemming from title-related issues.
So, who pays for title insurance in Washington State – the buyer or seller? While this can vary from one transaction to the next, it’s customary for the seller to pay for the buyer’s owner policy, and the buyer typically pays for the mortgage lender‘s policy. But, as with many closing costs, these things can be negotiated between buyer and seller.
“An Owner’s Policy is typically issued in the amount of the real estate purchase price, and remains in effect for as long as the owner, or his or her heirs, retains an interest in the property. In addition to identifying risk before a transaction is completed, the Owner’s Policy will pay valid claims and all defense costs against attacks on the title.”
This means if you have to go to court to defend your right to your home, the title insurance policy helps defend your rights and covers the legal costs associated with the battle.
Are title insurance costs negotiable in Washington?
Yes, buyers and sellers can negotiate who pays for title insurance during the purchase agreement.
What is lender’s title insurance?
Lender’s title insurance protects the mortgage lender’s interest in the property.
How much does title insurance cost in Washington?
Title insurance costs vary by property value and title company but typically range from a few hundred to a few thousand dollars.
Is title insurance a one-time fee?
Yes, title insurance is paid once at closing and provides coverage for as long as you own the home.
Does title insurance cover future claims?
No, it only covers issues that existed before the policy was issued.
What happens if there’s a title dispute after closing?
If covered, the title insurance company will defend your ownership and may cover financial losses.
Is title insurance included in closing costs?
Yes, title insurance premiums are part of the closing costs paid at settlement.
Can title insurance be transferred to a new owner?
No, title insurance policies are not transferable and must be purchased by each new owner.
Are you curious about mortgages, or are ready to apply for one? Sammamish Mortgage can help. We’ve been serving borrowers across the Pacific Northwest since 1992. We currently lend in Washington, Oregon, Idaho, Colorado, and California. Our experienced loan officers can answer any mortgage-related questions you have, and can also provide you with a rate quote. We offer a wide variety of mortgage programs and products with flexible qualification criteria. Contact us now to learn more, or visit our website to get an instant rate quote.
Whether you’re buying a home or ready to refinance, our professionals can help.
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