With rates dropping through the floor, many people have been motivated to refinance their homes. The lower rate may save them a tremendous amount of money throughout the life of the loan, but the refinancer should also expect to pay the lender all of the typical closing costs that are normally tied to any new loan. This includes service fees, points, title insurance protection (otherwise known as title insurance policies) and other expenses.

A refinance loan is no different than any other home loan to a mortgage lender. A lender will want you to purchase a title Insurance policy to insure that the new loan has been protected, just as the prior lender required previously. Basically when you refinance, you are not purchasing an owner’s title insurance policy, you are purchasing a lenders title insurance policy to protect your lenders interest in the property.

Most lenders who generate these loans often immediately sell these notes to secondary market investors like Fannie Mae. In order for Fannie Mae to protect their investment and security interest in these loans, they require title insurance coverage. Even if the lender decides not to sell loans, it is in their best interest to get a lenders policy to protect its interest and investments against title related defects.

Normally when purchasing a house a person will purchase both a lenders and an owners title insurance policy. Even if you did buy a lenders policy when you purchased your new home, the lenders policy only stays effective during the life of the loan that you have taken. When you refinance, the old loan gets paid off (the loan’s life expires) and a new loan has been issued for the new lender and they will require a new title insurance policy.

If you are interested in finding out what your reissue rate for a lenders title insurance premium is please feel free to get a FREE title insurance quote at our website, WWW.MYTITLEDIRECT.COM. You can also give us a call at (516)-222-2444 if you have any questions or concerns about the title insurance process or even questions about the closing process. We will be more than happy to answer any questions that you may have. We are a consumer direct company, and you the client are in our best interest.