Unlike Private Mortgage Insurance (PMI), title insurance protects the homeowner. Title insurance protects you the homeowner, if, after home purchase someone makes a claim against the property stating he or she rightfully owns the house or the land, has a lien on the property, or had a financial interest in the sale that was not accounted for properly.
Your lender will require you to purchase a new title insurance policy, no matter with whom you refinance. Even though you plan to refinance with the same lender, the existing title insurance policy terminates when you pay off the mortgage. Also, your current lender wants to make sure no issues have arisen since you bought the property, such as a lien filed against the property. A new title search will be done to make sure the title is clean and no unexpected liens or other encumbrances exist. If there are, you will have to pay them off before completing the refinance. It is worthwhile for you to check and see if there are any discounts available on your new title insurance policy, especially if you have been in your current loan only a short time. You may or may not get a discount, but it is not likely that you will be offered one if you do not ask.
You do not have to buy from the title insurance company the lender recommends. Some states regulate title insurance costs. If you live in a state that does, it does not make any sense to shop for a better deal. If you do not live in a state that sets the fee, you may benefit by comparison shopping for title insurance. I encourage zero brand loyalty when shopping for a new loan. Shop around for the best rates, fees, and terms you can find. Visit the Bills.com, refinance savings center to get no-cost quotes from pre-screened mortgage refinance providers.
I hope this information helps you Find. Learn & Save.