Yukon Home Buyer's Guide Tip of the Month Oklahoma

Getting Title Insurance

In buying your home, the lender will require lender's title insurance. This insures the lender will be protected against undiscovered title defects such as unpaid taxes by a previous owner, property easements granted by the previous owner, fraud, forgery, contractor liens, disputes among heirs, or a title search error. The insurance is in the amount of the loan. But this does nothing to protect you.

You need to buy owner's title insurance in the amount of the purchase price. If you are negotiating with the seller to pay your closing costs, clearly state the costs include your owner's title insurance as that is not a customary charge. You may be encouraged to save money by forgoing title insurance. Don't succumb to that temptation. Inform both lender and your closing agent you want owner's title insurance.

Get the title search done as early as possible--well before closing. It may take weeks --even months -- to clear some title defects. If you wait until the last minute, your moving plans may be disrupted. Press lenders, real estate agents, and your closing agent not to neglect this part of the transaction.

Purchasing the owner's title policy at the same time as the lender's title insurance will save you money. Rates vary but you might expect to pay approximately $2.50 per thousand of coverage for lender's title insurance. By purchasing owner's insurance at the same time you will only add about $1.00 more per thousand of coverage.

The cost of your title insurance will appear on the closing statement.