Re Issue Rate on Title Policy?

Question

Okay, I know title policies are necessary. Please address the re-issue rates. I've owned my property for 8 years since the last title policy and I'm building a home. What makes a person eligible for a reissue rate? I've asked this for the third time and no one brings up or addresses re-issue rates. I wonder why??????

Answer 1

Title insurance is highly regulated by each state. The answer will vary and the cost will vary by state. Call the title company you used eight years ago and ask.

Part of the insurance policy is covering you and they are already on the hook for the things done before you bought the house. They would also be issuing a policy to cover the mortgage company and this is at risk for not only the things that happened before you bought the home but also for things that occurred because of your ownership (they have to worry if you have an income tax lien, workers lien, divorce, inheritance, etc.)

The only people that can tell you about costs would be the title company. If not the same one at least one within your state.

Answer 2

It varies by state, but I believe an 8 year old policy would be ineligible for reissue.
However, you basically pay the difference between the old policy and the new one. There is generally a maximum allowable credit.
But as your question states you are building a home I assume you are wanting to get a discount for title on your new home? That will not work as the title policy is held to the address it was written for.

Answer 3

there are other things besides liens that have to be searched for. The title search also looks for special assesments, any unfinished paperwork (such as from when you bought the property) etc etc. Believe it or not there are transactions that go through only to find out later something wasnt signed etc. So by buying the title insurance you are insured against anything that could have gone wrong or been missed. Its to protect YOU. If you keep your title policy and dont lose it and you sell or refinance within a few years you can get a very big discount on the new policy.

Answer 4

When you submit your current existing title policy, you are eligible for a re-issue rate. The rationale behind this is that there is far less checking to do on the quality of the title being insured, since the checks were considered up to date when the previous title policy was issued.

Answer 5

You can get a reissue rate on the title policy if you have a copy of the original so your attorney can use that and save himself an extensive amount of work.

Costs are usually about 50% less than the issuing of a brand-new title policy.

You are VERY smart for thinking of that...most people don't realize it's possible and every loan officer needs to be asking for it on every refinance (and I'm assuming you are doing construction to perm here).

Answer 6

The majority of the time, you are eligible when you are refinancing, instead of purchasing, however, this sounds like a construction, depending on your title company and bank they may group it into a purchase category or have a seperate category for construction loans all together. The reissue rate in most cases is only going to give you that 7-8% discount. I would speak with your mortgage broker or loan officer and have them speak to the title company, to find out if you are eligible.

Answer 7

In CA it's usually when you refinance within 5 years. However, if you are doing construction you may not get the short term rate because the title company will have to make sure all mechanic liens are taken care of, etc. Ask the title company that currently holds your title insurance policy.

Answer 8

Re-issue rates are usually only available to owners who have financed within the last 3 years and the discount (at least in Oregon) is 20% of the cost of the original policy.