[ 2005 ] Should I purchase title insurance?

I read the basic 101 and other articles on the internet, but would still like to pose the question.

At which sales price range is it worth it to purchase title insurance if it costs $225 in addition to closing cost? I plan to pay $4K for the unit.

Let's say if not purchased, and there are liens & taxes against the unit, what happens?

Thanks,

There's no single answer to your question. Experience has shown that most purchasers here would not purchase title insurance for the purchase you are considering. However, there are exceptions. Doing your due diligence ( www.tug2.net/advice/purchase_checklist.htm ) might turn up some information that would suggest you purchase the insurance.

Is it likely that there are mortgage loans, liens or delinquent taxes? No. Most timeshare loans are consumer loans rather than mortgage loans tied to the timeshare. Liens of any kind are rare. Even more rarely are liens attached to a timeshare. Taxes attach to individual timeshare ownerships in only a few states, California being the most notable.

However, if you purchase the timeshare and later find out that there are attachments, you risk foreclosure and loss of your ownership rights, unless you pay off the amounts due.

In addition to purchase price and your own due diligence I would consider from whom I'm buying the week. Do you know them personally? If you don't know them, what is their reputation, etc?

Title insurance is just that, insurance if there is a problem with the title. There are many timeshares that have foggy titles. So, just as Dave said, it depends. I would look to see who developed the property, where it was developed etc. Then, I would look at my to make sure they have a clean title (no liens, no spousal problems etc.). Then I would make my decision. In the properties I have purchased, the answer to your question is no.

The problem with Timeshare title insurance is that it's outradgeously expensive relative to what they're insuring. When you buy a new house, title insurance of $1000 to $2000 insures the entire $200k (or $1 million house).

If the title insurance industry were proportionate.....something like 0.5% of the value of your $4k purchase would say it "should cost" $20 for them to offer the same insurance. (I think you're seeing $20 worth of insurance and $200 of administrative overhead in such a small policy).

I've bought $500 to $3000 Timeshares without title insurance. I once bought it when $300 insured a $35000 block of TS I bought.

As said above, your own due dilegence investigation can rule out lots of problems.

Here's the way to think of it. If you had a choice of two identical weeks for sale, one is offered for $4000 and one has title guarenteed for $4225, which do you want? You might get by with the $4000....but only you can decide whether saving $225 is worth this unknown risk.

Hat

With prices so low, why buy title insurance?

Ridewithme38 said:

With prices so low, why buy title insurance?

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Ride - This thread is from 2005...

Harry said:

Title insurance is just that, insurance if there is a problem with the title. There are many timeshares that have foggy titles. So, just as Dave said, it depends. I would look to see who developed the property, where it was developed etc. Then, I would look at my to make sure they have a clean title (no liens, no spousal problems etc.). Then I would make my decision. In the properties I have purchased, the answer to your question is no.

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If the US had a better UK Land Registry type process for recording title then Title Insurance could just go away.

DeniseM said:

Ride - This thread is from 2005...

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I couldn't find any threads from 2004!

Ridewithme38 said:

I couldn't find any threads from 2004!

Click to expand...

Oh, OK....now I see!