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Old 03-31-2018, 08:36 AM
42 posts, read 58,424 times
Reputation: 21


Hi All,

I have a quick question because I'm confused. I'm about to close on a brand new home in a couple weeks in (FL). The terms of the Purchase Contract have the builder paying virtually all of the closing costs (except the Prepaids & Escrow). When I signed the contract last year I gave them an earnest deposit of around $6K that was specified the entire amount would be applied to whatever closing costs/prepaids I had. I'm doing VA 100%/0 down and with the builder (seller) covering most of the costs per the Purchase Agreement I'm trying to figure out approximately how much of that I'll get back.

The loan estimates help but where I'm getting confused regards the Title Insurance. Per the contract, the seller is paying for the lender's TI policy, but I have to pay for an Owner's TI policy if I want one. I know the rate is discounted if both policies are purchased at the same time, so my question is who ends up paying the Promulgated rate and who gets to pay the discounted rate? My Purchase price is around $220K so based on FL rules the promulgated rate is going to be somewhere around $1200. On my loan estimate it showed the Lender's TI for this amount, but for the Owner's Policy Title it listed $250. But I've also seen from other forums the way this is displayed on the estimate might not be correct. And I've been researching other sites that tend to say it's the Owner's policy that's charged the promulgated rate, but then I find things that base this assumption on the fact that the Purchase Price for the Owner > Loan Amount of the Lender which in my case is not since it's a VA loan/0 down and as of right now, the VA funding fee is rolled into the loan. I can't seem to find any examples online of where the seller pays for a lender's policy while the buyer pays for the owner's policy: it seems to be normal that one side would pay both if they were done at the same time. And I know if I don't purchase an Owner's TI policy, the lender's TI the seller would have to pay would be the full rate, so it doesn't make sense to me why they just don't cover both if they got a discount. Am I missing something?

Looking at my prepaids I was estimating getting back somewhere in the $3K-$3500 range. But if I am on the hook for the higher Owner's TI rate, that can drop down to $2300. I'm just confused because the builder's agent usually tells people to save about $2500 for closing if they don't have a sizable earnest deposit like I do, is that because they don't think Owner's TI is important?

Sorry for the confusion. I'm just trying to nail down roughly what the figure I'll get back is so I'm not shocked when I get the CD. If I get back more money at closing,
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Old 03-31-2018, 10:43 AM
1,512 posts, read 565,559 times
Reputation: 2944
As the Title insurance scam varies by state, this will probably be a FL specific question. May want to hit up the FL board?
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Old 03-31-2018, 11:22 AM
Status: "October is the eighth month" (set 20 days ago)
Location: Just south of Denver since 1989
10,678 posts, read 28,495,910 times
Reputation: 6842
Call the Title Company on Monday and ask for the fees.
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Old 03-31-2018, 12:54 PM
Location: Austin
7,077 posts, read 16,893,484 times
Reputation: 9484
Your question really doesn't matter because you have to have Lenders coverage because you are financing. It's all in their numbers no matter how you roll the dice. There is no specific discount on one verse the other. The numbers are based on both policies being purchased. The only way to avoid it is to pay cash.
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