Home inspection findings by Frank Schulte-Ladbeck, Professional Real Estate Inspector TREC# 9073

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Do You Have a Choice in which Title Insurance to Use?

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Closing on your new home can be difficult, and you may be paying more than you need to spend.

What title insurance company will you use? Have you checked into the costs? If you are like most people, you will follow the pattern that I took; go with the company your Realtor suggested. Hopefully your Realtor did their research on which title insurance is best for you, but they may not have. I picked title insurance, because this is one of the expenses you will have when closing on your new home, and because the topic has been studied already.
In 2007, I and many others saw a new world opening up for the real estate industry with how the internet was being used by home buyers. More real estate search engines were coming online, and ratings of service providers was quickly making headway. New style brokerages, such as Redfin, were getting a lot of press. What some real estate professionals realized was that home buyers could pick and choose from products that they wanted and the service providers that they would hire. This boded well for reducing the costs of buying a home. At that time, the Government Accounting Office (GAO) did a study of one aspect of home closings: title insurance. The hope was that buyers would start choosing which insurance to buy, creating more competition and lower closing costs.
By 2008, we were in the housing crisis, so we were not focused on this quest to allow buyers have a choice. We were focused on getting buyers. In some recent articles on Realtor marketing, there has been a renewed commitment to the idea that your Realtor should be a knowledge base instead of a gate keeper. The idea is that your Realtor is there to help you with their knowledge, but you make the decisions. Realtors would not hire the service providers or arrange for specific title insurance, they would let you make the arrangements, so you can find what is right for you. Is this happening? No, or not always. By opening this field up, you may find that brokerages are charging you for items that you do not need (stress may, each brokerage is different).
If you ask me to recommend a Realtor, my first inclination is to pull up a list of Realtors that I know personally. From that list, I will probably pick someone who fits your needs( I think), or who I like. This may not be the best for you though. Realtors would do the same. They will set up the home inspector that they like, or any other service that they prefer. This is normal in all of our business lives. Of course, as consumers begin to take charge of their own destinies, the internet will be even more of a resource, allowing them to pick more wisely. Realtors who can show that they are a resource by their websites will do better. This applies to all real estate professionals.
Getting back to title insurance, I want to direct you to the summary page for this document. Most of you my not want to read the report, but the summary page may be enlightening. As stated, the report is from 2007, but there was an evaluation of the recommendations done in 2009. What we can see is that we consumers may not be getting all of the information that we need (the dreams of 2007 are still on hold). If you look over this summary, I am sure that you will be a wiser consumer, but I hope that you will question the steps in your own path to purchasing a home leading up to the closing. You may save yourself a good deal of money. Here is the the Title Insurance Report Summary.

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© Frank Schulte-Ladbeck Professional Home Inspector Houston, Texas
Frank Theodor Schulte-Ladbeck
home inspector, TREC# 9073
Houston , Texas , 77063 United States

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