Real Estate Closing Question

[LFD2037]

Doing a 2 time close construction then permanent loan. The lender for both is the same. On the construction loan closing estimate, they're showing that I pay for lender's & owner's title insurance. Then they show me paying for it again @ the 2nd closing when I convert the loan to permanent. Is this correct? Why would I pay twice for the same property?

[Rescue1]

we just did the same thing a couple months ago. i didn't have to pay it twice, even though it was listed in the closing estimate twice. and i had different lenders.

[HoustonHunter]

Should only need to pay for that once.

[LFD2037]

I wonder why they're saying I need to pay twice. Especially for both owner & lender. I asked them Friday via email but have yet to hear back.

[flatlander]

A lot of good lenders have gone to a one close construction loan, can save you a lot of money if it's not too late.

But yes, as stated above, you should only pay that once.

[LFD2037]

1 time close was the plan for the last 2 months. They then notified me a couple days ago they don't do 1 time close on rural property. We're in a time crunch now so I have no choice but to stick w/them. First United in Dallas gets a big thumbs down from me!

[boogercounty]

My guess is you will pay the title policies at the first closing and then receive a credit on the second closing which should result in a very small endorsement charge. The lender is probably trying to comply with the TRID settlement charge disclosures and has erred on the upside. Just my 2 cents.

[Stan R]

My guess is you will pay the title policies at the first closing and then receive a credit on the second closing which should result in a very small endorsement charge. The lender is probably trying to comply with the TRID settlement charge disclosures and has erred on the upside. Just my 2 cents.

Been in the business for almost 30 years... The above is correct..

[LFD2037]

My guess is you will pay the title policies at the first closing and then receive a credit on the second closing which should result in a very small endorsement charge.

How small is very small?
The construction (1st) loan has $227 Owner policy & $1,795 Lender policy. On the permanent (2nd) loan it's $500 Owner policy & $200 Lender policy. That's ~$2,700 in just title policies!

[boogercounty]

I can not remember what the endorsement charge will be, seems like it used to be around $125 or so, and I should not have said "very small" as that is relative. Maybe Stan R can help with a closer estimate.

[Mertzon Man]

Once !

[LFD2037]

How small is very small?
The construction (1st) loan has $227 Owner policy & $1,795 Lender policy. On the permanent (2nd) loan it's $500 Owner policy & $200 Lender policy. That's ~$2,700 in just title policies!

Lender said:
"You will pay the Title Policy when you close on the interim loan and then you will receive what they call an R8 credit when you go to the permanent loan. There will be a fee usually about $200-$300. This is a title company fee."

I can't figure out their reasoning on this. Owner policy doubles from first to second loan & Lender policy goes from $1,795 to $200 (due to the R8 credit, I guess).