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We did our closing today. It turned out that the big difference came from three things:
1. The title company gave us an "enhanced" policy to cover more causes, which raised the basic rates by $450. You either accept it or decline it prior to closing. Afterwards you cannot change your mind. After talking to them on the phone, we finally decided to take it since we are concerned with one of the causes: If someone somehow managed to get a mortgage against your house, the insurance will cover the defense and the loss (if you lose the case). We wish we had enough lead time to investigate to see whether "enhanced policy" is worth it or not--not right before the closing. So a suggestion for any home buyer here is (if you are not shopping for title insurance yourself) to ask your attorney about the title insurance--what causes are covered and what price for each item--in advance. This would help you make a wise decision on whether to take the "enhanced" policy, and more importantly, you would know you are covered if something did happen.
2. A $250 closing service fee (I guess it's standard) is included into the title insurance item.
3. Several Other overheads are slightly higher from what they post on the website. One item--an upper court fee is based on the number of names searched.
Hope this would help you avoid surprise at closing.
I am an attorney in New Jersey and I handle quite a bit of real estate transactions. As other users have advised you, title insurance premiums are regulated by the State of New Jersey, so the Basic Premium Rate is set in stone. At $572,000.00, your premium is $2,323.00. There are additional charges for Examination (usually around $100.00), plus judgment searches, copies, "simultaneous issue" (when you are also purchasing a policy for your lender, which itself runs about $25.00), endorsements, closing protection letter, tax search, Notice of Settlement filings, etc. The additional charges on top of the premium usually come out to somewhere in the area of $400.00, so your total title insurance bill should have been around $2,750.00 or so.
As far as the survey goes, the cheapest surveyor I use charges about $575.00 for a survey for a property of one acre or less. To have corner markers placed costs $75.00 per corner, and please note that many properties have more than 4 corners to mark, even if they appear to be rectangular. The point is, $720.00 sounds a LITTLE high, but I don't think it is offensive. If you don't trust your attorney, ask to see the bills from the surveyor and title company. They probably check out fine.
If you had an attorney AND you still were charged a closing service fee AND it was not clearly disclosed when you hired the attorney, you probably used a lawyer who does not handle the transaction himself/herself. Some attorneys let the title agency handle the closing, which is OK, but costs you extra. In my opinion, if it was not disclosed to you from the outset, you were taken for a $250.00 ride by an attorney who is too busy to be bothered by a real estate closing. This is becoming more common in the field.
That quote does sound a bit high for a $572K house in Livingston. Our peers are correct in that the one-time title insurance premium is regulated by the NJ dept. of banking and insurance, but some 'pass through' charges are not. Title agents abide by the NJ rate manual (issued by the commisioner) which allows them to charge a certain amount on certain fees -- for example, photocopy fees, download/copy fees, settlement fee, recording and filing costs, etc. The title agency I work for could (and does) charge the optional, minimum $5.00 photocopy fee, while I've seen other quotes at a $50.00 copy fee. It somewhat depends on where you go and most of the time the attorney (even though the BUYER is paying for the title) chooses the title company and just automatically orders the title with (sometimes) not even notifying the borrower.
As far as endorsements, title search, examination thereof, etc., the average from what I've seen through my closings is the following (and this includes lender's most-of-the-time-standard closing requirements):
Endorsements: roughly $100-125
Title search AND examination: $105 for a purchase and $90 for a refinance
Tax Search: $40.00
Tidelands Search: $47.00
Superior Court and Patriot name Judgment Searches (depending on how many names are run): $36.00-60.00
Hope that helps.
Oh yea, and surveys:
Every attorney and/or title agent (because sometimes title agents order the survey on behalf of the attorney) should have multiple survey contacts for each county. I have seen a full survey with corners for $450.00, but I've also seen the same survey for a different property cost $850.00, so it depends on who you order your survey from. Ask your attorney to obtain quotes on 3 surveyors, and pick the cheapest.
I did not notice the update-posts until after my posting my message. I could not help but offer my input
I have attorney clients that prefer our agency to disburse and coordinate the closing, and clients that prefer to handle it themselves. In my opinion, regardless of who's handling the closing -- it's our (the title agency's) job to ensure a smooth closing for both the client and the attorney. It is our job to insure the buyer that the home he/she is buying is theirs and free and clear of any liens from the date of their policy backwards.
Regardless, your attorney should have been up front with you in regards to the cost and who's coordinating the closing. Good luck in your future home buying experiences (and call up esqdmd to represent you).
The State does not SET the rates, the rates are filed by the Underwriter with the NJ Department of Banking and Insurance and the State watch-dogs them.
In NJ, all search fees (County, Muncipal and Superior courts), along with recording fees, express mailing fees, etc. are "pass through" fees and the title agency cannot charge less or more than the actual cost.
Additionally, the Owner Policy is issued at an additional $25. It is the LENDER who requires the title insurance coverage in order to do the mortgage. You can elect to waive your Owner's Coverage and not pay the $25 and only the bank's mortgage interest will be insured. But why would anyone do that?
What the bank is concerned about is old mortgages, judgments, tax sales, foreclosures, improperly filed documents, etc. that could affect their interests in the property.
When buying or refi-ing your property, you can ask for a quote or a prelim HUD disclosing the title fees on your transaction. It will give you a good benchmark of what to expect.
BTW, charging $250.00 for the settlement fee as the closing title agency is illegal and rebate.
The fixed fee for closing IN the title office during regular business hours should have been $300.00. If it was out of their office regardless of the time, it should have been higher. The lowest fee they can charge is $300.00
Discounting the fee is considered rebating and violates RESPA
Rabble Rouser - the $25.00 simultaneous on a purchase is for the loan policy, not for the owners policy. If you are purchasing for $300,000.00 and taking a $260,000.00 loan, you pay a rate on the 300, not the 260.
In regards to the enhanced rate that someone mentioned earlier, it is definately not worth it. They build what are called your ALTAs into the premium, and then charge a higher rate in general. The ALTAs that you typically buy with a policy are your ALTA 8.1 and your ALTA 9, and they protect the lender, not the owner. Also, these ALTAs are only 25.00 each, so if your premium was 400 dollars or so higher, you can imagine that it is more money to the title company and their sales person and not more protection to you, necessarily. I would advise people to make sure you request NOT to be charged an enhanced rate.
As for surveys, honestly, the fair rate for about an acre of property is between 500 to 750 dollars. If you are getting the job done for less than 500.00, chances are you are getting a crappy survey.
In regards to title settlement fees showing up when you have an attorney to do your closing, you retained the services of a lousy attorney. What they do is order the title and ask the title company to prepare all the settlement aspects of the deal and the attorney just shows up at the closing to act as a witness, basically. On top of that, the attorney will still charge you as though he or his office handled all the settlement work. If you ever notice title settlement fees on a HUD for purchasing a property, you should ask your attorney if he minused those fees from his fee as you are, more or less, paying him for nothing.
I am an attorney in New Jersey and I handle quite a bit of real estate transactions. As other users have advised you, title insurance premiums are regulated by the State of New Jersey, so the Basic Premium Rate is set in stone. At $572,000.00, your premium is $2,323.00. There are additional charges for Examination (usually around $100.00), plus judgment searches, copies, "simultaneous issue" (when you are also purchasing a policy for your lender, which itself runs about $25.00), endorsements, closing protection letter, tax search, Notice of Settlement filings, etc. The additional charges on top of the premium usually come out to somewhere in the area of $400.00, so your total title insurance bill should have been around $2,750.00 or so.
As far as the survey goes, the cheapest surveyor I use charges about $575.00 for a survey for a property of one acre or less. To have corner markers placed costs $75.00 per corner, and please note that many properties have more than 4 corners to mark, even if they appear to be rectangular. The point is, $720.00 sounds a LITTLE high, but I don't think it is offensive. If you don't trust your attorney, ask to see the bills from the surveyor and title company. They probably check out fine.
Maybe you can answer this for me. Why is new title insurance required when we refinance?
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