What is it and do I need it? The easiest way to explain title insurance
is to use a few examples. Let's say you purchase a home that's 50 years
old and during that time the house was sold to a number of buyers. Back
in 1955 Mr. and Mrs. Smith purchased the house and a few years later,
Mrs. Smith ran off and joined the French Foreign Legion without telling
Mr. Smith. During that time Mr. Smith remarried and Mr. Smith and the
new Mrs. Smith sold the house to Mr. and Mrs. Jones. The Jones lived
there for a number of years and one day, the original Mrs. Smith showed
up at their door after retiring from the Foreign Legion and told the
Jones' that she never signed the deed over to them and that she was
still the rightful owner.
What if the property taxes were not paid back in 1955 and the tax collector is right behind Mrs. Smith demanding payment . . . with interest? Title insurance and the addons, called endorsements guarantee that past problems will not become your problem.
Title insurance is regulated by the Pennsylvania Insurance Commission.
The cost is based on the sales price or mortgage amount whichever is
higher and is set by the State of Pennsylvania.
Most lenders will require you to have title insurance. After all, if
there's a problem and you walk away from the home, they have the "title
You are not required to obtain title insurance if you are paying cash for the property, but, like any other insurance, it's there in case you need it.
The mortgage company usually arranges this and is usually provided by the settlement (title insurance) company.
And remember, no matter who provides you with the policy, the rates are always the same from company to company because the State of Pennsylvania sets the rates.
How much is it? Use the Pennsylvania title insurance calculator to estimate the title insurance premium.
FREQUENTLY ASKED QUESTIONS:
Who pays title insurance in Pennsylvania?
Typically, the home buyer pays the cost of the title insurance policy, however, the policy may be paid by the seller