When buying or selling real estate in Palm Beach County, one of the most common questions that comes up at closing is: who pays for title insurance, the buyer or the seller? Title insurance is essential because it protects both the buyer and the lender against potential problems with the property’s title, such as liens, recording errors, or ownership disputes. The responsibility for paying depends on local customs and what is agreed upon in the purchase contract.
Title Insurance in Palm Beach County
Unlike some states where title insurance responsibilities are fixed, Florida follows county-by-county practices, or should we say, traditions. In Palm Beach County, the seller typically pays for the owner’s title insurance policy. This policy protects the buyer’s ownership rights and ensures they receive clear and marketable title at closing. Because the seller pays, they also usually have the right to choose the title or closing agent. Furthermore, the buyer usually pays for the lender’s title insurance policy, also known as the mortgagee policy. This coverage protects the lender’s financial interest in the property and is required whenever financing is involved.
Negotiation is Always Possible
It’s important to remember that while the seller traditionally pays the majority of the title insurance related fees, it is not set in stone. Real estate contracts in Florida can be negotiated, and either party can agree to cover more or less of the closing costs, including title insurance. For example, in a competitive market, a buyer might agree to pay for the owner’s policy to strengthen their offer, or a seller might cover additional costs to make the deal more attractive.
Even though the common arrangement in Palm Beach County is that the seller pays for the owner’s title insurance policy, and the buyer pays for the lender’s title insurance policy, it is wise to have a third party review your contract carefully since the allocation of costs can vary depending on negotiations. Understanding who pays for title insurance helps both parties prepare for closing and avoid surprises.
When choosing The Law Office of Donna Hearne-Gousse, P.A. for your title, escrow and closing needs, you’ll enjoy all the benefits associated with an attorney-based title agency at similar, and in many cases, lower costs than a standard title company will charge.
If you are purchasing property in the state of Florida and want to learn more about title insurance or any other aspects of the closing process, contact us today.
The Law Office of Donna Hearne-Gousse
(561) 582-5670