Owners title insurance?

3 Replies

Hey BP, what is the general consensus on paying or opting out of "Owner's Title Insurance" as part of closing costs?  In MN it appears to be an optional expense.  Is it really necessary and/or worth the cost (which is $873 in this particular case)?  Feels like it could be one of those things that just lines the pockets of the mortgage company, however, I also don't want to be overly pessimistic.  

I do understand that the "Lender's Title Insurance" is required.  

Any advice would be appreciated.  

@Mike Pederson

The lender's policy protects the lender and the lender gets nothing out of the owner's policy, financially or otherwise.  The OTP only protects the purchaser against certain defects and encumbrances to title. 

Personally, eliminating a title policy for such a small price is like stepping over a dollar to save a dime.

The mortgage co. makes nothing off of the title insurance.  The title agent/issuing attorney does.  I'd buy it.  10-20 years from now when you have a ton of equity, would you want it to be at risk?

I'm on the side of taking it, too. As others have pointed out, lender's title insurance insures the lender, and only the lender. As the owner, I would like to be insured too. I have never had a need to 'use' title insurance, but I want it to be there in case I ever do need it!

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