Here are 6 tips to help you save money on the title-related closing costs.
1. Find & Provide Your Owner’s Policy of Title Insurance
- The most common way to save on the cost of title insurance during your refinance is to provide the title agent a copy of your owner’s policy of title insurance. Your owner’s policy of title insurance entitles you to what is called “Reissue Rate.” Reissue rate is a significant credit off of the cost of the lender’s policy required by your lender. The amount of the credit depends on a couple of factors – the amount of coverage in your owner’s policy and the amount of your new loan. CONTACT US for to find out how much you can save.
- What if You Can’t Find Your Owner’s Policy? Don’t worry! We can help you recover a lost policy. Give us a call so that we may help.
2. Find & Provide Your Survey
If you have a mortgage on your real property that is not a condominium, you more than likely have a survey of the property. A survey describes in detail the boundary of your property, the measurements of buildings and the location and sizes of easements and setbacks. It is necessary for us to issue a Florida Form 9 Endorsement, which is additional title insurance coverage required by your lender. The cost of a survey depends on the size of the property and can range from $250 to well over $2,000. Fortunately, we can use your existing survey if you have made no significant changes to the property. Contact us to find out if your survey can be reused.
3. Using Your Existing Lender?
- If you are refinancing your home mortgage with the same lender, you may be eligible for discounts off the cost of title insurance and intangible taxes owed to the state.
- A lesser known title insurance discount is called “Substitution Rate.” Substitution rate can result in even more of a savings than reissue rate. It applies when the same borrower and the same lender make a substitution loan on the same property and use the same title insurer. If you think your refinance may qualify, please contact us so that we may provide you a quote.
- Part of the closing costs associated with your refinance is an intangible tax payable to the state. The rate for the intangible tax in Florida is $0.20 per $100.00 of your loan amount. For example, the intangible tax on a loan amount of $150,000.00 would be $300.00, which you would have paid at the closing of that loan through the title agent (we take care of that for you!). If, however, you refinance an existing loan with the same lender, Florida law provides that the intangible tax is only due on any “new money.” In the example above, if your new loan is for $175,000.00, your intangible tax would be based only on the difference between the loan amounts – $25,000 – and would total $50.00. That’s another savings of $300.00! To find out if your loan qualifies, give us a call.
4. Take Control of Title
As the borrower and the party who will pay for the lender’s policy of title insurance, you can choose your title company. By exercising that choice, you will have far greater control on the negotiation of pricing and over the level of attention and service you get during the loan closing process.
5. Ask About Lender Credits for Closing Costs
Depending on your loan type or program, the lender may be willing and able to offer you credits for certain closing costs. Don’t hesitate to ask your loan officer about the availability of credits when discussing the terms of your loan.
6. Shop Around & Take Your Time
It may go without saying, but you should always shop around for the best rate and terms. The best deal may be just a phone call. From large lenders with ubiquitous TV and online ads to your local community bank or credit union, opportunities to discuss your refinancing options abound. Take in as much information as you can and then take enough time to digest the options. And, should you need a fresh set of eyes or a sounding board, we are here for you.