Q? WHO PAYS FOR WHICH EXPENSES AT CLOSING?
A. Closing costs are determined by the terms of your contract for the purchase and sale of the property. Customarily, but not always, the closing costs are divided between the buyer and seller:
The Buyer pays:
Recording Fees – varies by county
State Documentary Stamp Tax – varies by county
Intangible Tax – varies by county
Owner’s Title Insurance Policy - based on the sales price.
Lender’s Title Insurance Policy
Refinances – Variable, depending on production of Prior Owner’s Title Insurance Policy
Endorsements to Lender’s Policy
Express Mail – If applicable, charged to the appropriate party.
The Seller pays:
State Documentary Stamp Tax for Deed of Conveyance – varies by county
Owner’s Title Insurance Policy – based on the sales price.
Taxes – Current year’s real estate taxes are prorated as closing
Title Search, Exam and Closing Fee – Approximately $550.00
* Please use this information as a guide only. The information is not warranted whether expressed or implied. And as such you should request clarification in writing whether from our offices or one of your choice.
Q? SINCE THE LENDER ALREADY REQUIRES TITLE INSURANCE, WILL THAT PROTECT ME?
A. Not necessarily. There are two types of Title Insurance. Your lender likely will require that you purchase a Lender's Policy. This policy only insures that the financial institution has a valid, enforceable lien on the property. Most lenders require this type of insurance, and typically require the borrower to pay for it.
An Owner’s Policy, on the other hand, is designed to protect you from title defects that existed prior to the issue date of your policy. Title troubles, such as improper estate proceedings or pending legal action, could put your equity at serious risk. If a valid claim is filed, in addition to financial loss up to the face amount of the policy, your owner’s title policy covers the full cost of any legal defense of your title.
Q? HOW MUCH DOES TITLE INSURANCE COST?
A. Florida regulates the rates on the premiums for Florida title insurance. The only costs that may differ would be the actual fees, such as search and examination, closing costs and miscellaneous fees such as wire transfers, FedEx or courier fees and endorsements.
The one-time premium is directly related to the value of your home. Typically, it is less expensive than your annual auto insurance. It is a one-time only expense, paid when you purchase your home. Yet it continues to provide complete coverage for as long as you, or your heirs, own the property.
Q? WHAT IS A TITLE DEFECT?
A. Anything in the entire ownership of a piece of real estate which may encumber the owner’s right to the “peaceful enjoyment” of the property or which may cause the owner to lose any portion of the property.
Q? WHAT IS A TITLE SEARCH?
A. A title search is a detailed examination of the historical records concerning a property. These records include deeds, court records, property and name indexes, and many other documents. The purpose of the search is to verify the seller’s right to transfer ownership, and to discover any claims, defects and other rights or burdens on the property.
A title search can show a number of title defects and liens, as well as other encumbrances and restrictions. Among these are unpaid taxes, unsatisfied mortgages, judgments against the seller and restrictions limiting the use of the land.
Q? DO I NEED TITLE INSURANCE?
A. Most definitely! Title Insurance is a means of protecting yourself from financial loss in the event that problems develop regarding the rights to ownership of your property. There may be hidden title defects that even the most careful title search will not reveal. In addition to protect you from financial loss, title insurance pays the cost of defending against any covered claim.
A title insurance policy insures against any losses suffered due to this sort of legal action, up to the face amount of the policy, and pays any and all legal costs incurred defending your rights against the claim. Depending on the size and extent of the claim, this can add up to thousands of dollars you would otherwise have to cover on your own.
Q? WHAT IS MEANT BY “TITLE” ?
A. “Title” is the foundation of ownership property. A Florida title gives you a legal right to possess that property and to use it within the restrictions imposed by authorities or limitations on its use, superimposed on the basic right to possession by previous owners.
When you purchase a home, you are really purchasing the title to the property—which is the right to occupy and use the space. That title may be contested based upon past rights and claims asserted by others. These types of claims can infringe upon your purchase of the property or cause you to lose money.
Q? WHAT IS TITLE INSURANCE?
A. Title insurance assures that your rights and interests to the property are as expected, that the transfer of ownership is smoothly completed and that you receive protection from future claims against the property. It is the most effective, most accepted and least expensive way to protect your ownership rights.
Title insurance is used by homebuyers and lenders for protection against back taxes, undisclosed liens, legal judgments, forgeries, fraud and a host of other potential legal/financial problems that can arise when purchasing or refinancing property.