Title Insurance Fees Explained

The HUD1 Settlement Statement represents the financial summary of a real estate transaction.  It will contain fees charged by a mortgage lender, title insurance provider, and any third parties.  In a purchase, the financial agreement between the buyer and seller will be contained on the HUD1.

Types of Fees

In Pennsylvania, the HUD1 Settlement Statement will contain three types of fees:

• Premium, Endorsements, and Closing Protection Letter – Premium represents the primary cost of the title insurance policy.  Endorsements to the title policy and the Closing Protection Letter offer additional coverage. The fees charged should not differ from one provider to the next. Read more about title insurance rates
• Reimbursements and Government Charges - items the settlement agent has paid or will pay on your behalf to third parties, such as document recording, transfer tax, wire transfer fees, overnight mail, and tax and utility certifications.
• Other fees – fees charged by the settlement agent that are not title insurance premiums or reimbursements, such as a notary fee or an out of office settlement fee.

In Pennsylvania most title agents and underwriters adhere to an all inclusive rate for title insurance. The title insurance premium includes the costs of the title search and examination and the settlement fee for settlements conducted during normal business hours.

Beware of Other Fees

Not all providers are the same and unfortunately, some agents will "create" fees and pad actual expenses to increase your bottom line cost.  Do not hesitate to shop around for your settlement services provider – comparison shopping is your best protection.  We have prepared a convenient guide for you to use when comparing agencies – How to Shop for Title Insurance.

Protect Your Right to Shop

And most importantly, make sure you tell your real estate agent and lender upfront that you will choose your settlement services provider.  It doesn’t hurt to speak with their recommendation and include them on your shopping list but keep in mind that your real estate agent or lender may receive a “reward” for steering you to an affiliated title agency.