Title Insurance In New York - What you, as the consumer, needs to know!

'Title Insurance: 5 Things Every New York State Homebuyer Or Refinancer Of A Mortgage, Should Know!' (from the Hallmark Abstract Service website and updated January 2020)

Typically a homebuyer will let their attorney take the lead when it comes to the title insurance portion of a purchase transaction! (Updated, January 2020)

Similarly those refinancing a mortgage will do the same with their lending institution.

And given that the relationship between the attorney or banker and their client is based on trust, that is fine. But, at the same time, think about this…

In any purchase that a consumer makes they should, and typically will, be aware of the criteria being used in the product or provider selection process.

After all, when you buy a television or a car you are intimately involved in the decision-making process so, why not in one of the most important segments of your property purchase or mortgage refinance?

The decision being made? Selecting the firm that will be insuring that you have good, clean and clear title to the residential or commercial property you are buying or refinancing!

The cost of the title insurance premium will not vary between the firms providing the policy but, there is so much more to be aware of…

Five Things To Be Aware Of When Buying Title Insurance

1. For Your Transaction, Compare Title Bills From More Than One Title Insurance Provider – When you receive a copy of the title bill for your real estate transaction in New York, the title insurance premium being charged will be the same regardless of the company you choose to use (Note: in a mortgage refinance, make sure you are being charged at the reissue rate if your transaction qualifies for it)!

Many of the other charges that appear on the title bill, however, known as 'junk' or ancillary fees, can and will vary from firm-to-firm. Sometimes this variance can be in the many hundreds of dollars.

This, in addition to the other points below, is why the consumer should take a somewhat active role in the choice of the title insurance provider that is selected.

And when you're comparing the ancillary or ‘junk’ fees on various title bills, Hallmark Abstract Service is proud that we charge among the lowest in the industry, feeling we are well compensated through the title insurance premium. Because of this, our clients can save as much as $1,000 when comparing our title bill to those of some other companies in the marketplace.

Remember, our recommendation regardless of who is providing the title insurance, is to get a title bill from another company in the marketplace for comparison purposes.

2. Know Who The Title Insurance Underwriter Is! – When you buy insurance, regardless of the type, it’s critical that if a claim is put in that the underwriter will have the financial ability to pay! Remember that the claims-paying ability of companies are not created equal! This is certainly the case with title insurance underwriters. Hallmark Abstract Service primarily uses Fidelity National Title Group, the best capitalized title insurance underwriter in the business.

3. What Is The Title Claims Experience Of The Firm Chosen To Provide The Title Insurance Policy? – In the same way that all underwriters are not created equal, the firm actually doing the work to ensure a buyer will have good and clear title are not either! Don’t be afraid to ask questions as, once again, for most people this purchase will represent the largest one that they will make in their lives! Hallmark Abstract Service is proud that in our 10+ years in business we have not had a valid title claim!

4. Does The Title Company Chosen And/Or Anyone Involved In The Transaction Have An Affiliated Business Arrangement? – Perhaps an uncomfortable question to ask, but you as the the consumer have the right to know and the firms involved have the obligation to tell! An Affiliated Business Arrangement or AfBA, ‘is an arrangement to share or refer business between two different companies involved in providing services in the closing of a real estate transaction. There may be ownership interest of a party in both the business referring out the service and the business receiving the referral.The practice is not illegal, but is regulated by RESPA to assure full disclosure to the consumer of any relationships where business is referred in this way.’ (Source)

You want your title insurance provider to solely be focused on protecting you, their client, and not considering a business arrangement with a third party. Hallmark Abstract Service has no affiliated business arrangements.

5. You As The Consumer Have The Right To Choose The Title Insurance Provider – It's entirely possible that you may not want to but, be aware, that if you do it is your right to choose!

Michael Haltman is CEO of Hallmark Abstract Service in New York, and can be reached at mhaltman@hallmarkabstractllc.com or (646) 741-6101.