Selling a property on Oahu and closing in a few days. As the seller, does it make sense to purchase Owner's Title Insurance? I would figure any issues would be covered by the Buyer's lender/owner policy. Or am I being naive and that insurance company would quickly come after me as the previous owner to recoup their costs?
I think its up to the buyer to get title insurance, if you sold it why would you want to be protected? Is there a law that would make you liable here?
Please disregard, I was looking at the HUD statement when I noticed this charge with an "optional" note. I had forgotten that we agreed to pay a portion of the buyer's policy in the purchase agreement. Shame I can't delete this post... live and learn!
Like anything else, if you can take a risk (of someone go after you and your asset), this is a option.
If you decide not to, you are self-insured.
Title Insurance is, by nature, in case anything wrong with title, with or without your knowledge, to release you (Seller) from that. I will not advise any Seller to take a chance.
Does it make sense to go without? That is a question of what your sales price worth question.
Thanks @Russ Draper My thoughts exactly. No law that I'm aware of.
Thank you @Misa Kataoka I will be paying for this, as it's in the agreement. But I guess there is still confusion for me as to which party should be buying a policy. I understand a buyer may want an Owner's policy in addition to a Lender's mandatory policy. Are you suggesting a seller should consider having independent policy?
As a buyer, I pay for the extra title insurance when I purchase a property. If their lawyer put you down as liable and you signed, oh well. But why would you buy another policy for yourself if you are leaving? Once they have paid you the money isn't it their problem? That is why they got title insurance!
Ok. There are Seller and Buyer. Both offered insurance. Buyer likely needed to cover lender as well.
Who is covered?
If you buy, you are covered. If Buyer buy, they are covered.
Like auto insurance, one at fault will be responsible. This insurance does not transfer to next owner.
Hope this helps,
A seller never,ever buys a title insurance For Themselves, as a seller. You likely bought one when you Bought the house, but that’s different.