Title Insurance admits they are wrong, but I have some questions on what to expect next

[Justin Shaulis]

So we are trying to refinance our home and found out that we had an issue with the property and after about a month of dealing with the title insurance company we finally got the following letter:

I want to share my findings with you after I reviewed your claim. It appears that First American Title Insurance Company (“FATICO”) insured the following:

Lots 1, 2, 3 and 4, .......rest of legal description....

As you correctly pointed out (Original Seller) conveyed a portion of the property that was insured namely the southerly 11 feet of Lot 4 to (current neighbor) prior to the recording of your Deed (FATICO did not insure the East 10 feet of the closed alley and is therefore not included in this claim).

Attached you will see the legal description used for your tax parcel identification number this description excludes the southerly 11 feet of Lot 4. This provides you with the correct legal description of your property and also shows that you have not been paying taxes on property you do not own.

FATICO can insure the refinance using the attached legal description without any further delay. The Commitment will need to be changed to reflect the new legal description and to remove the requirement to obtain a deed from Rachel Meeks.

I will order a diminished value report, which will basically tell us the value of the 11 feet and FATICO will compensate you for the loss of that 11 feet.

This is good news, but I have a couple additional questions.

What/How do you figure out the 11 feet of property is worth? To make this more complex, the 11 feet in question includes our neighbors home (as in 8 of those 11 feet). Should I expect the title company to try and screw me for a money standpoint? What can I do to figure this out and to counter whatever they offer me?

Any advise would be awesome!