Buying a home in Washington DC, Maryland, or Northern Virginia comes with closing costs beyond your down payment. One potential way to lower those costs is to ask about a reissue rate on your owner’s title insurance policy.
Owner’s title insurance is optional, while lender’s title insurance is generally required when you finance a home purchase with a mortgage. The lender’s policy protects the lender, while an owner’s policy protects your ownership interest. If you are leaning toward purchasing optional owner’s coverage, checking whether the seller’s existing policy qualifies you for a reissue rate could be a good way to save money. Source
The question is simple: Does the seller have an existing owner’s title insurance policy that qualifies me for a discounted premium on my new policy?
DC’s insurance regulator specifically recommends asking about this opportunity and notes that a reissue rate can save hundreds of dollars in closing costs. Depending on the circumstances, it may even save thousands. Source
What is a title insurance reissue rate
A reissue rate is a discounted title insurance premium available when a property was previously insured and the new transaction meets the insurer’s requirements.
For a home purchase, the seller’s existing owner’s policy may help you qualify. You receive a new policy covering your ownership; the seller’s policy serves as evidence of prior insurance.
Owner’s title insurance protects your ownership interest against covered title problems. A lender’s title policy protects the lender’s interest. Ask specifically about the cost of your owner’s coverage. Source
Does the previous policy have to be 10 years old or less
Sometimes, but there is no single 10-year rule for the entire Washington DC area. Eligibility depends on the property’s jurisdiction and the title insurer’s applicable rate rules.
In Maryland, the Maryland Insurance Administration explains that a reissue discount depends on the insurer’s filed rates. A requirement that the previous policy was issued within the past 10 years is one possible limitation. Source
In Virginia, WFG’s published rate manual, effective September 1, 2023, requires the prior owner’s policy to be no older than 10 years when the new policy takes effect. That is an insurer-specific example, rather than a blanket rule for every policy. Source
For DC and Maryland, some underwriting programs accept older policies. Federal Title reported in August 2023 that its participating underwriters had removed the 10-year restriction for those jurisdictions. Source
Even if the seller has owned the home for more than 10 years, ask the title company to check. Have it confirm the rules that apply to your transaction.
What should you ask the title company
Ask early in the process:
“Please check whether the seller has an existing owner’s title insurance policy and whether it qualifies my purchase for a reissue rate. Please confirm any policy-age limit, the documentation needed, and the savings on my new owner’s policy.”
Ask the seller or listing agent for a complete copy of the policy. If it cannot be located, ask your title company whether it can search available insurer records or accept other evidence of prior coverage. Documentation requirements vary; WFG’s Virginia manual, for example, allows certain settlement documents as proof that an owner’s policy was purchased. Sources · WFG manual
How much can you save
The savings depend on the insurer’s rates, your coverage choice, and the amount insured by the seller’s previous policy. The discount may apply only up to that prior coverage amount.
For example, suppose you buy a home for $800,000, and the seller’s qualifying owner’s policy insured $600,000. Under a schedule that limits the discount to prior coverage, the reissue rate applies to the first $600,000 of coverage, while the additional $200,000 is priced at the applicable regular rate. This is an illustration, not a premium quote. Source
Ask for a written comparison showing your premium with and without the reissue rate. Compare the same coverage level and review the title company’s other settlement fees, too.
Short FAQs
Can an existing title policy help me save money
Yes, if it qualifies under the insurer’s rules. It can support a reissue discount on your new owner’s policy.
Is a policy older than 10 years automatically ineligible
No. Some insurers impose a 10-year limit, while certain DC and Maryland programs accept older policies. Ask your title company to verify.
Do I need to use the same title company
Not necessarily. Some insurers accept qualifying prior policies issued by other underwriters. Confirm this with your chosen title company. Source
Does the discount apply to the entire purchase price
It may apply only up to the seller’s previous policy amount. Additional coverage can be charged at regular rates.
When should I ask about the reissue rate
Ask when requesting title and settlement quotes, and provide the required documentation before closing.
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Brian Martucci is a loan officer for Capital Bank Home Loans, a division of Capital Bank, N.A. He has been in the mortgage industry since 1986 and has served in a number of roles, including loan processor, loan officer, mortgage broker, branch manager, and vice president. Brian Martucci – NMLS# 185421. His opinions do not necessarily reflect the opinions and beliefs of Capital Bank Home Loans or Capital Bank. Capital Bank, N.A.- NMLS# 401599. Click here for the Capital Bank, N.A. “Privacy Policy”.
