When buying a property in Louisiana - or anywhere around the country - there are so many closing costs that you will be responsible for as a buyer, such as homeowners insurance, property taxes, appraisal fees, as well as title insurance. It is not uncommon for buyers to try to negotiate with the seller to share some of the costs.
But when it comes to title insurance in Louisiana, who pays?
The Importance of Title Insurance
Many buyers often question whether or not they truly need title insurance. After all, it is just another cost they must deal with on their quest to buy a home. Though trying to cut corners and save a little bit of money now can end up costing you big time down the road.
Title insurance protects against any title defects that may appear after the title search and after the sale of the property. This can include things like judgments, liens, forged or erroneously recorded documents, easements, and so forth. Should an issue arise once you take ownership, having title insurance will protect you both financially and legally. It is important to note that this type of insurance is different from others, such as car insurance and health insurance as it protects against issues from the past - not against those that may happen in the future. In other words, it protects against any title defects that were missed in the title search before you purchased the property.
There are two types of title insurance policies - a lender’s policy and an owner’s policy. The former solely protects lenders and is often required by them as a way to reduce their level of risk. An owner's policy is optional but is highly recommended.
Who Pays for Title Insurance in Louisiana?
In Louisiana, the homebuyer is often responsible for buying title insurance. Unlike other closing costs, title insurance is a means of protection that can benefit the buyer for years to come. And it is almost always a requirement by lenders.
In situations where the seller and the buyer negotiate, the seller may either pay for or contribute to the payment of title insurance. However, ultimately, the responsibility of purchasing title insurance falls onto the buyer.
So, how much does it cost?
The cost of title insurance varies. It is determined by the purchase amount of the home or, for a lender’s policy, the total amount of the loan. You only pay once for title insurance. That’s right, one payment at closing and you are covered for as long as you have an interest in the property (owner’s policy) or until the loan on the property is satisfied (lender’s policy).
Your Title Insurance Questions Answered at Bulldog Title
For us, title insurance is what we do on a daily basis and we know the ins and outs of it very well. That makes us a great resource for you. If you are not familiar with a title search, title insurance, the settlement process, or even how a title company can help – our experts at Bulldog Title Insurance Agency, LLC, are here for you.
Contact us today at (318) 361-0061 today!