Title Insurance -

Importance of Title Insurance when refinancing

A homeowner’s policy is good for as long as you own the property, but it does not insure the new mortgage created when you refinance and it does not provide protection against events that may have transpired between the time you purchased the property and when it is refinanced, therefore; the lender requires its own title policy insuring the validity of your mortgage.

Changes could have occurred since your last refinance or purchase. There could be unknown or false legal judgments against you or a mechanic’s lien against the property. You may have taken out a second mortgage on the property that could threaten the priority of the new lender’s mortgage.

Another reason lenders require a new title policy is that many mortgages are packaged as securities and sold to investors in the secondary mortgage market. Investors demand assurance that the mortgage backing these securities is valid and enforceable. Title insurance is the only practical basis for that assurance.

HELP YOUR REFINANCE CLOSING RUN SMOOTHLY AND EFFICIENTLY.
Consider these points when refinancing, in order to avoid possible problems.
Check with you lender to determine the points that apply to you.

Bring to the closing the following items, and before the closing, contact your lender regarding any additional requirements that may need to be satisfied prior to closing:
  • Cashier’s check or certified check for amounts you must pay.
  • An original Homeowner’s Insurance Policy, along with a receipt for payment of the first year’s premium. If you are refinancing a condominium, bring a Certificate of Insurance instead. A Certificate of Insurance can be obtained from you condominium association (HOA) or Property Management Company.
  • Personal identification that includes your picture and signature.
  • If you have an existing mortgage(s), a current pay-off letter(s) must be presented at closing. Contact your lender for instructions on how to obtain a current pay-off statement(s).
  • The most current credit card(s) statements, if you are going to be paying off credit card balances at the closing.
  • If your property is a condominium, bring an assessment letter from the condominium association (HOA) or Management Company.
 
Note: If your transaction requires a Notice of Right to Cancel, disbursement may be delayed until the fourth day following the day of the closing.