New Pennsylvania Title Insurance rates take effect today.
July 1st, 2012 Pennsylvania Title Insurance rates officially go into effect. The old rates being overhauled was a long time in the making. Below is an example of the old rate schedule for transaction ranging from $0 – $30,000:
As you can see, there were 4 different categories of the one standard basic rate. There is the basic rate of insurance ($420.00), the reissue rate ($378.00) which was applicable to purchase and refinance transactions that had a policy issued within the past 10 years, a mortgage refinance rate ($302.40) which was applicable for a refinance transaction only if a policy was issued within the past 2-4 years and finally a further discount on a refinance ($264.60) if a policy was issued within 0-2 years. This rate schedule was sometimes confusing to consumers and to agents to determine the correct charge. New Horizon Abstract ALWAYS applied the lowest discounted rate where applicable.
The new rates that go into effect today have simplified this rate system. The example below shows coverage from $0 – $30,000, for comparison to the above old rate schedule:
So the new simplified schedule shows the elimination of the reduced 0-2 year and 2-4 year refinance reissue rates. The other notable change shows the “Basic” charge has changed to “Sale” and “Reissue” has changed to “Non-Sale”. It’s simple, if you are purchasing a property you get the “Sale” rate. If you refinance, you get the “Non-Sale” rate. The Endorsements and Closing Protection Letter rates have stayed the same.
The increase in the rates was something that needed to happen since the last revision of the rate schedule back in May of 2006. An increase in the rate collected is due to changes in the market. An increase in claims due to foreclosing lenders filing frivolous claims against underwriters in a desperate attempt to recoup money they were losing due to foreclosure proceedings. Sadly, this practice is still occurring around the country, as if big banks don’t have enough money already they need to pinch title insurance underwriters. Another reason to increase rates is that premiums for agents have fallen along with sales prices of homes.
The NEW RATE SCHEDULE can be found here: NEW RATE SCHEDULE 2012
The new rates do not reduce the level of competition among title insurance companies. If you are in need of a title quote check out our new form here: PA Title Quote Please feel free to contact us if you happen to have any questions regarding a title insurance quote 570-424-9705.
