All home buyers have fees to pay associated with the purchase of property of which Title Insurance is a part. And it's expensive. Based on a $450,000 property (the median sales price of a home in Ashburn, Virginia), the cost is around $2,000 (about $1300 for the lender's policy and $700 for the owner's policy).
Would you like to keep some of that $2,000 in your pocket? You may be able to if you can get the re-issue rate on the owner's policy, which is 30 percent less than the regular cost.
In order to get the re-issue rate, the Owner's Title Insurance policy that the current owner has can not have been issued more than 10 years ago. If seller doesn't have an Owner's Title Insurance policy or if it's more than 10 years old, you're out of luck.
To make sure that you don't lose out on the savings, write it into the purchase offer. If you're in Northern Virginia and using the "Regional Sales Contract"*, you can add the appropriate verbage in "Other Terms" (paragraph 34). If you're curious as to the proper verbage to use, check with your agent or real estate attorney.
If using a real estate agent, your agent should have already checked if the sellers bought the house less than 10 years ago and if so, addressed this with you prior to submitting your offer. If they haven't mentioned it, bring it up.
A few minutes worth of work. A few hundred dollars saved. Not a bad hourly rate!
Note - You also get the reissue rate if you're refinancing so don't forget to double check on this with your settlement agent prior to closing on your refi.
*The "Regional Sales Contract" is widely used by real estate agents in Northern Virginia. Your specific agent and/or area may use different forms.
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