Frequently Asked Questions
As licensed title agents with decades of experience, we field a lot of questions not just about title insurance but about the entire buying, selling, and mortgage process. Here are straightforward answers to some of the most common questions we get.
Title insurance is an indemnity insurance that protects property owners (and their mortgage lender) against a financial loss in the event that a lien or judgment created by a previous owner should pop-up during the time that you own the property. When you purchase an owner’s title insurance policy, you’re covered for claims up to the purchase price of the property. An owner’s title insurance policy would also cover litigation costs for any covered claim, whether or not the claim is legitimate.
Title companies wear several different hats during the course of a real estate transaction. Once you have a signed agreement to buy real estate, we start by completing a title search that goes back at least 60 years to make sure that the sellers are the rightful owners of the property and that they (along with the owners before them) haven’t created any liens or judgments that would prevent the buyer from owning the property free and clear of all defects.
We’re also responsible for coordinating the real estate settlement process with the buyers, sellers, mortgage lender, and real estate agents. Lastly, we conduct final settlement, and we assure that all of the seller’s financial obligations that could create a lien against the property are satisfied, the mortgage documents are signed, notarized, and recorded according to the lender’s instructions, and all taxes and other payments are dispersed according to the terms outlined on the ALTA Settlement Statement.
Although you are not required by law to purchase an owner’s title insurance policy, we recommend that you do so. When you weigh the benefits of the owner’s policy, along with the fact that it’s a one-time premium paid at settlement and the policy remains in-force for as long as you and or your heirs own the property, it's well worth the peace of mind.
Keep in mind, if you’re going to have a mortgage, your lender will require you to obtain a lender’s title insurance policy to protect their interests against defects in title. If you're financing 80% or more of the purchase price, the lender’s title insurance policy accounts for the majority of the cost of the title insurance, making the additional premium for the owner’s policy just a few hundred dollars.
Federal law gives homebuyers/borrowers the right to choose their own title company in states like Pennsylvania, where it’s customary for the buyer to pay for it. Although your real estate agent, lender, or builder can suggest that you use their title company, they can’t demand it. If you’re purchasing new construction and your builder is insisting that you use their title company, who actually pays is negotiable, so if it’s that big of a deal to them, ask them to pay for it.
The one-stop shop is the marketing illusion that you’ll get the best deal for multiple services all in one place. In fact, your agent and/or their broker will probably ask you to commit to using the in-house title company when you're placing an offer on a house. It's not necessary to commit at this time. Ask for a complete estimate with all related fees and tell them you plan on shopping around.
The reality is that although it sounds good, when you compare transparency, service and price, you’ll likely get better value from an independent title company like ALT.
No, it doesn’t. This is a false claim designed to fool consumers into believing it’s not worth shopping around for title insurance. While it's true that state regulated title insurance premiums may not be discounted, many title companies charge non-mandatory miscellaneous title service fees which can add up to $700 or more to the total cost of your title insurance.
No—it won’t. Choosing your own title insurance company will not delay your closing. While some agents or lenders may suggest that sticking with their “preferred provider” is the only way to stay on schedule, that’s simply not true. This objection is often more about persuasion than practicality.
Agents and lenders who have financial ties to a title company may use the fear of delays to discourage buyers from shopping around. Since they can’t legally require you to use their affiliated provider, they rely on subtle pressure to steer you back toward their business interests.
Know Your Rights
Under federal law, you have the right to choose your own title company. At ALT Title, we work directly with your lender and agent to ensure your transaction stays on track. You’ll close on the same timeline—without the extra fees and with more savings.
Now that you know that title insurance related fees and services don’t cost the same everywhere and you can save money, you’ll want to start getting familiar with what the estimated cost will be once you know your price range and approximate amount of your future mortgage.
Those are the two numbers that you’ll need to determine the cost of the title insurance policy. Once you have that information, it’s time to start getting estimates for title insurance and settlement services.
You’ll want to order title search once your offer has been accepted. Once you place your title order and the home inspection is clear, a good title company will have the search completed in 5-7 business days.
If you’re being told you only have 6 days after your offer is accepted to order title insurance according to the terms of the PA Agreement of Sale, don’t sweat it. There’s a poorly written clause that was added to the agreement by the PA Association of Realtors in an attempt to give their brokers a greater ability to steer business to their in-house title company.
If you need a few extra days to decide, let your agent know as it’s not a big deal. Furthermore, the clause does not give your agent the authority to take control and order title insurance without your approval.
When your real estate agent asks you to sign an authorization allowing them to order title insurance with their in-house title company - AI suggests this response:
Hi [Agent’s Name], before I proceed with any of the third-party services you’ve recommended, I’d like to confirm whether any of these referrals involve financial incentives, paid marketing agreements, or referral fees. I want to ensure there are no conflicts of interest and that all recommendations are being made in my best interest. Please clarify this in writing.
When asking for a title insurance quote, here's an AI email template to get you started:
Hi, I’m shopping for title insurance and would like a full breakdown of all fees associated with both the lender’s and owner’s policies. Please include title premiums, search and exam fees, settlement or escrow fees, recording fees, and any other charges. I want to make sure everything is disclosed up front with no hidden costs.
Frequently Asked Questions About the Mortgage Process
Here's a quick AI generated email to ask your lender if you're getting the best possible rate and if there's room for improvement or even a credit.
Hi [Lender’s Name],
Thank you for the offer you've provided—I appreciate your time and support so far. Before moving forward, I want to make sure this reflects your most competitive rate and loan terms. I'm currently comparing options from a few lenders and would like to know if there's any room for improvement in the interest rate, fees, or lender credits.
Could you provide a loan comparison both with and without a credit? How would a credit impact my rate?
Mortgage Brokers don't work for one specific lender; they survey the entire market to find you the best rate and terms available.
Using a mortgage broker gives you access to multiple lenders, from Rocket Mortgage and other national lenders to local banks. Ask them about a lender credit upfront then let them find you the best deal that fits your situation.
This is an easy one, yes. Unless you’re buying a house from a friend or relative, it’s highly unlikely that a seller would even consider your offer unless they’re relatively certain you can get a mortgage loan. Mortgage brokers, lenders, and credit unions all offer free pre-approvals.
Pre-approvals can be relatively easy, especially if you're organized. First your lender will pull a copy of your your credit report, then they'll need to verify a number of things:
- Verify your income by reviewing your pay stubs and W2 forms
- Verify that you have a stable employment history
- Review your expenses to determine the amount of money you’d be able to borrow.
Once that all checks out, they’ll provide you with a pre-approval letter which you can submit with your offer so that the seller can see that you are qualified.
Closing costs, which are additional fees paid by both buyer and seller on real estate transactions, typically add an additional 5%-7% of the purchase price to the cost of buying a house. They consist of lender origination fees, title insurance fees, admin. fees and/or commissions to the real estate broker, home inspection fee, state and municipal transfer tax, and county recording fees to record the new deed and mortgage. Also included as part of the closing cost calculation, but not considered fees, are reimbursements to the seller for pro-rated portions of real estate taxes that have been paid in advance, along with funding an escrow account managed by your lender to pay future real estate tax payments and homeowner’s insurance premiums.
In the example below, we show you what a closing cost estimate looks like. And in under 5 minutes you can create your own estimates with just a few pieces of information on any property in PA, at my.cashtoclose.app. The tool is free to use and you can create as many estimates as you need on multiple properties without ever logging in. Or create a free account to save and return to your estimates later for editing.
(Click to enlarge or view this estimate online)
A seller credit is negotiated as part of your offer on the property. It is an amount of money that the seller will contribute to your allowable closing costs at settlement, and that could be a tradeoff for a higher offer price, an expedited settlement, or other concessions in terms of the sale.
A seller credit can also be used to buy down your mortgage interest rate for the first two years of your loan so that you can ease into home ownership with a lower interest rate and monthly payment.
If you are planning to ask for a seller credit or any other types of credits or grants, you must involve your lender before making an offer on a house. Your lender will need to structure your loan and your offer in a way that maximizes the total amount of all allowable credits.
Another option to reducing the amount of personal cash you’ll need to buy a new home is receiving gift funds from a family member. Unlike seller credits, lender credits or commission rebates, there are no limits to the amount of gift funds that you can receive towards the purchase of your new home.
Gift funds can be used towards closing costs and your down payment, essentially making it possible for you to buy a new house without touching your savings.
Gift funds can also be applied to a buy down on your mortgage interest rate.
Pennsylvania and/or the local government where the property is located will sometimes offer first time homebuyers, or low-income buyers, grants that can be used for down payment assistance, but there are usually some strings attached.
Government grants typically require you to stay in the property for a specified period of time in order for the grant to be forgiven. If you decide to move before that window of time, or if you add or remove someone from the title to the property, you may need to pay all or a part of the grant money back. Most grants show up as a lien against the property which remains in place until the maturity date.
Frequently Asked Questions About Real Estate Brokers/Agents
Here's a quick AI generated email to use when asking your real estate broker/agent to waive their admin fee.
Hi [Agent’s Name], I noticed there’s a [broker service/admin/transaction] fee listed in the agreement. I want to be upfront that I’m not comfortable paying anything more than I have to. Many agents I’ve spoken with are waiving these fees entirely, and I’d like to ask that this fee be removed or reduced as part of working together. Let me know if that’s something you can accommodate.
Broker admin fees—also known as broker service fees, conveyancing fee, or flat-fee commissions—are charges brokers collect for so-called administrative services.
Yes. Unfortunately, consumers often times find themselves in the middle of compensation challenges between real estate brokers and their agents. As brokers search for ways to offset paying their agents a large majority of the total commission, some brokers pass additional fees onto the customer to increase revenue. This tug of war has nothing to do with the consumer and the law is on your side. Consumers do not have to pay additional fees or use their real estate broker's in-house service providers as a condition of buying real estate.
Know your rights. Under federal law, the buyer is not required to use any ancillary services provided by their real estate broker as a condition of purchasing real estate. That includes this admin fee. If you plan on shopping around, we suggest stating your intentions up front while interviewing potential agents. This prevents any hard feelings or misunderstandings once the emotions of house-hunting kick into high gear.
A reputable independent title insurance company will already be providing the majority of these services for no additional charge. It’s all included in the one-time title insurance premium that you pay at final settlement.
For instance, when you hire ALT to provide title insurance and settlement services, we manage your transaction and there’s no additional charge. And the total list of services that we perform on your behalf far exceeds the transaction management services offered by most real estate brokers.
No, they don’t, but the smart ones will.
The idea behind the commission rebate is based upon an assumption that the seller is paying the commission to the buyer’s agent. Under that scenario, the buyer’s agent would rebate a portion of their commission to assist the buyer with their closing costs. Sort of like a thank you to the buyer for choosing them to be their agent. It’s also a smart business decision and will likely lead to future referrals.
If closing cost assistance or making sure you get the best deal on real estate services is your goal, you probably don’t want to hire the featured service providers on big home sites like Realtor.com or Zillow. While these sites are great resources for finding a home, the agents and other service providers featured on their sites are often being charged up 40% of their commission as a referral fee in return for access to you as a client, so they’re often less flexible with offering commission rebates, waiving unnecessary fees, or offering the most competitive rates.
A buyer’s broker is a real estate agent who is hired by the buyer to represent their best interests throughout the home buying process. When the buyer and agent sign a formal agreement, the agent takes on a fiduciary duty—meaning they are legally and ethically obligated to act in the buyer’s best financial interest.
This includes:
- Putting the buyer’s needs ahead of their own
- Disclosing all important information that could impact the buyer’s decision
- Following all lawful instructions from the buyer
Having a buyer’s broker ensures you have a professional advocate on your side during negotiations, inspections, and every step of the transaction.
Commission rebates from your real estate agent or broker are considered as credits and need to be disclosed to your lender. With lender approval, the commission rebate can be applied as a credit against the amount of money you’ll need at settlement, which reduces your out of pocket expenses.
Or if the rebate puts you over the maximum credits allowed towards closing costs, your broker can write you a check once the transaction has closed.
Frequently Asked Questions About Refinancing
In Pennsylvania, mortgage lenders require a lender’s title insurance policy as assurance that their loan will be in first lien position. This policy remains in effect until the loan is satisfied.
Each time you refinance, you satisfy your existing loan and begin a new one. Your new loan will require a new lender’s policy to insure it, even if the loan is with your current lender.
If at the time the buyer bought the property, they purchased an owner’s title policy, that coverage will stay in place for as long as they own the property.
Whether this is a purchase or refinance, if the figures on your Loan Estimate are not 100% in line with what's on your Title Insurance Quote, don't panic. Your lender is providing a preliminary estimate without having confirmed any fees with the title company. They usually estimate title fees to the high side because if they were to under disclose title fees, they might be responsible pay the difference.
Once your lender hands off your file to your chosen title company, the fine tuning of the numbers will begin. At that time, your title insurance figures will be adjusted to the exact figures that apply to your transaction.
ALT Title waives any miscellaneous title fees and we'll remove them along with any other fees that don't apply during the final stage of calculations.
If you want to double check title fees against your title quote, focus on the Final Closing Disclosure, not the Loan Estimate. When you receive your Final Closing Disclosure a few days before final settlement, your title insurance fees should be in line with your title quote, provided that there hasn’t been any changes to the loan amount or terms.
The length of the process will depend on how organized and responsive your are. First you will work with your lender in a process that involves a mortgage application, a loan estimate, lots of disclosures, and a preliminary Closing Disclosure. And depending on your loan terms, it may involve an appraisal of your property and a few requests for supplemental information. It's important to followup on any lender or title office voicemails and emails to keep the process moving forward.
During this process, your title/settlement company will schedule a date/time for your closing. About 3 days before your final settlement, your lender will release the final numbers to the title office which will make any necessary adjustments to the title insurance premium and required endorsements, and remove any miscellaneous fees that don't apply.
The total process takes at least 3 weeks but it could take longer to get your refinance to settlement.
If you’re thinking about refinancing, start to collect your documents. Either scan or take clear photos so that you have digital copies of these documents for each borrower to be listed on the loan.
- Recent pay stub
- Prior year's W2
- Driver's license
- Social security card
- Most recent mortgage statement
- Prior year's federal income tax filing
- Homeowner's Insurance declarations page
- Recent two years of tax receipts*
*Every lender will require proof of tax payments and you have two choices. You can provide the proof yourself and save a few dollars or your lender can pay a third-party to obtain a tax certification at your expense.
If you pay your real estate/school taxes from an escrow account, or if you don't have the receipts, you can formally request a copy. Unless you live in Philadelphia county, you'll need to send a letter to your tax collector along with a self-addressed stamped envelop. There may be a small fee so either call or check the county website first. If you take the time to do this now, you'll avoid a $55 tax certification fee later.
NOTE: If your current mortgage is an escrow loan, your lender will automatically order a tax certification. So if you've got receipts, let your lender know to avoid this $55 fee.
How long does a refinance settlement last?
The final settlement meeting for a refinance still involves a lot of signatures but overall, a refi closing is shorter than a purchase. We typically can wrap up a refinance settlement in about 30 minutes as long as you come prepared.
You should continue to make all mortgage payments up until your refinance goes to settlement. Your mortgage payment will be prorated based on the settlement date and any amount in excess will appear as a credit on the settlement sheet. Even if that means sending in a mortgage payment a week before your refinance goes to settlement, it's better to get a credit than getting hit with a late fee.
When you compare the payoff amount on your mortgage statement vs your settlement sheet, it's normal to see that final number increase. Here's why:
Mortgage interest is always paid in arrears. When you make a payment, you’re paying the principal on the current month and interest on the previous. So when you payoff the loan, you’re catching up on the interest for that final payment. In addition, you'll most likely get hit with some farewell fees. Lenders typically add a mortgage satisfaction fee of about $100 as well as a fee for preparing the payoff statement. If the payoff funds are wired to your lender, they may charge a fee to receive the incoming wire transfer. On the other hand, if payoff funds are sent via an overnight check, you'll be charged another day's interest which will likely exceed the wire fee.
If you're getting cash back with your new loan, and you're refinancing your primary residence, you won't leave settlement with a check in hand. This is due to a federal law which gives the borrower 3 days to rescind the loan. That 3 day period begins the day after settlement; therefore, disbursements will happen on day #4 following settlement, not counting Sundays. Your title company will overnight your check as soon as the rescind period is over. So although you won't receive a check at settlement, you should have access to those funds within a week.
If your annual real estate taxes and homeowner's insurance are included in your mortgage loan, you have an escrow account. Each month, your lender deposits a portion of your mortgage payment into your escrow account in order to pay your insurance premiums and real estate taxes when due. That escrow account is specific to your loan. When you refinance, your escrow account needs to be closed and a new one created.
When you refinance, if your mortgage payments are all current, your lender will refund any remaining balance in your escrow account back. You'll most likely receive a check directly from the lender following settlement or, in some cases, they’ll refund it to you by issuing a credit for the escrow account balance on your mortgage payoff statement.
You will have some time before your first mortgage payment is due. Typically, you won't have a payment due the month following settlement because you've already prepaid the interest. The day of settlement is the only day you pay interest in advance on your mortgage. Your new loan goes into effect on day 4, and you prepay for the balance of the month.
Don't worry, within a week following settlement, you’ll receive a letter from your new lender outlining the due date for your first mortgage payment. They will also include an initial payment stub or two so that you have them. Ultimately you should receive regular mortgage statements in the mail.
After your refinance goes to final settlement, here's what happens after the 3 day rescind period.
- The loan disburses and if you're getting cash back, you'll receive a check.
- The new mortgage is recorded with your municipality’s recorder’s office.
- Your existing mortgage is paid off and any related escrow account is closed.
- You'll receive a letter from the new lender outlining the due date for your first payment.