Investors who plan to “turn over” their properties within a short period of time should consider the Interim Binder to save on title insurance premiums. The Interim Binder is not, in itself, a policy of title insurance. When issued, however, it binds the insurer to issue a policy of title insurance within two years. The fee is a mere 10% of the basic policy fee to the requesting party.
When the deed of the final purchaser is recorded, the binder is exercised and a policy of title insurance is issued to the final purchaser. The only additional fee at the time would be an additional liability charge based upon the difference between the original selling price and the selling price to the final buyer.
Let’s look at some examples, assuming that the seller is paying for the owner’s insurance in favor of the buyer in both cases: