Important factors to consider when writing title insurance across states are the closing and recording fees that you might encounter, specifically:
- Deed tax
- Transfer Tax
- Mortgage Recording Tax
These costs and fees can differ significantly among states. There are states in which you might pay the 3, and others that only charge deed tax. So if you are trying to estimate closing costs it is important to ask these questions up front so you realize what you should expect.
Recording Fees in Different States
In some states the recording fees could be quite onerous. For example, if you're recording a mortgage in New York City a brand new mortgage is going to cost just shy of 2% from the loan amount, which can represent a significant additional cost when coping with commercial property. A common practice there is to modify the mortgage. So you'll see a mortgage that was originally created 50-70 years ago and it is been modified some time and time again, passed from lender to lender, and borrower to borrower on down the line because they're trying to minimize expenses.
Understanding the Fees Associated with Your Transaction
If you're a property investor or if you're representing a commercial real estate client, it's important to understand what those fees are going to seem like beforehand because they can significantly boost the cost of a transaction.