Author Topic: Owner's Title Insurance - How Necessary is it for new construction?  (Read 5625 times)

Apocalyptica602

  • Bristles
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Hi all,

See topic. We're going to be closing on a home within the next 30 days, and are finalizing our estimates as we move toward closing. We're buying a new construction home from a builder, and noted that lender's title insurance is mandatory and owner's title insurance is recommended.

From my initial research it seems that title insurance is to prevent me from losing my house if there are liens against the title for the land / house without my knowledge, shady sellers, undiscovered claims, renters posing as owners, etc.

Since I'm buying new construction directly from a builder and will be the first 'occupant'. Do you feel this is necessary? Appreciate any and all advice.


Apocalyptica602

  • Bristles
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Re: Owner's Title Insurance - How Necessary is it for new construction?
« Reply #1 on: August 31, 2016, 08:37:54 AM »
Throwing out a bump because it fell to the second page, anybody have any insight?

Much appreciated!

nedwin

  • 5 O'Clock Shadow
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Re: Owner's Title Insurance - How Necessary is it for new construction?
« Reply #2 on: August 31, 2016, 10:30:10 AM »
Can you negotiate with the seller that owner's title insurance is paid by them?  Also, are you certain that it is not owner's extended coverage which is optional?

In the broad scheme, you will not be the first occupant of the property, unless the seller received title directly from the government.  There are innumerable circumstances where your title could be inferior to someone else, or where what the builder thinks it is selling you falls short of what you actually receive (in regards to title, not quality of the house).  The chances something will come up are remote, however.

If your lender lets you skip owner's title insurance, it comes down to a judgment call.  The worst that could happen is that you lose title to the property, and all the money that you put down.  Personally, I would not go without it.  It's a small expense compared to the whole transaction.

ketchup

  • Magnum Stache
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Re: Owner's Title Insurance - How Necessary is it for new construction?
« Reply #3 on: August 31, 2016, 10:37:42 AM »
I would still get it.  As nedwin said, that land belonged to someone before the builder, and probably someone else before that.  Plenty of opportunities for things to get hairy.

Rural

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Re: Owner's Title Insurance - How Necessary is it for new construction?
« Reply #4 on: August 31, 2016, 04:26:07 PM »
 Get it. It won't cost much now, and it won't be available for any price later. The land is the main thing you're worried about, anyway.