Title Insurance Costs in New York

My prior post described in a nutshell the role of title insurance. But how much does title insurance cost? New York State is divided into 2 zones. I practice in the New York City Area which is considered Zone 2 and includes most of downstate New York and so I will only discuss this zone. Also, please note that in this post I am only discussing the cost of the insurance premium and not of any other cost associated with buying title insurance (such as the cost of the title search and recording fees which I will discuss in later posts).

Title insurance rates are set by the title insurance companies and are published with the NYS Insurance Department. Although the rates are not "regulated" by any governmental agency, title companies cannot deviate from their published rates. Several years ago, most underwriters reduced their rates by 15% after a lawsuit initiated by the NYS Attorney General at the time. I believe that Old Republic did not sign on to this reduction and are still charging the higher rates. If I am incorrect, please let me know so that I can change this post. Regardless, make sure that the company insuring your title signed on to this reduction and if not, switch companies to save the 15%.

As for the rates, they are based on the amount of insurance which is based on the cost of the property or the amount of the loan. The formula if difficult to explain but for illustrative purposes:

a. title insurance for a $200,000.00 house purchase with a mortgage of $160,000.00 will be $1,291.00

b. title insurance for a $500,000.00 with a mortgage of $420,000.00 will be $2,688.00.

c. title insurance for a $1,000,000.00 with a mortgage of $800,000.00 will be $5,439.00

So you see the range of the cost to you depends on the price.

When purchasing a property, the title insurance premium is divided into 2 parts which I combined in the examples above. One part is the title insurance you buy to insure you, the homeowner and the other part, which is considerably cheaper is the lender's title insurance which will be discussed in the next post.