Do we need Title Insurance when buying direct?

[Genie+]

Here’s what Timeshare Users Group (TUG) had to say:

DECIDING FACTORS?​

Are you purchasing from the original owners of the timeshare (ie did they purchase the timeshare new from the developer directly) or are you buying from a reseller? Timeshares that have been transferred numerous times are at a much higher risk of title defects, and would be much better candidates for title insurance vs a timeshare purchased directly from the developer and only having one owner. Timeshares that are sold by large bulk resellers are also at higher risk as they are not likely even the owners of the timeshare they are selling in the first place...and you may never even get to speak to the actual owner of the property!

Remember, the whole purpose of Title Insurance is to ensure that the seller of the timeshare has the right to sell that timeshare, and that there are no issues with the title that would somehow prevent the transfer of the title from their name into yours and thus leaving you stuck in limbo after paying for a timeshare that you cannot properly take ownership of or utilize! Also by purchasing title insurance now, you can also provide proof to a future buyer that the title is free and clear (at least when you bought it) should you decide to sell it in the future.

https://tug2.net/timeshare_advice/timeshare-title-insurance.html#portfolio - for the full article

 

[rubybutt]

If that stranger was contractually obligated to give me 45,000 dollars back if ANY title issues came up, ever.

Then yes

Not my point. People were using the excuse in the total price that it was a small line item as justification. That is a horrible way to think about it. That is the same way car dealers get you to pay for the nitrogen in tires.

What you paid for the contract should have no bearing on your decision to purchase or not purchase the insurance. Obviously, this is a personal risk tolerance issue and can't be answered by any but OP. But things we can all agree on:

* No one has ever used the title insurance with a direct purchase that we know of
* The possibility of any one person needing the insurance is well less than 1% and probably less than 0.01%
* The cost of the insurance compared to the cost of the contract should have no bearing on the purchase of the insurance

 

[Genie+]

If that stranger was contractually obligated to give me 45,000 dollars back if ANY title issues came up, ever.

Then yes

Are they obligated to the full amount over any issue? Like say one name was spelled wrong on an owner’s direct DVC contract. Does the title insurance have a choice to fix the issue rather than buy back the entire contract minus closing fees and interest?

 

[Sandisw]

Not my point. People were using the excuse in the total price that it was a small line item as justification. That is a horrible way to think about it. That is the same way car dealers get you to pay for the nitrogen in tires.

What you paid for the contract should have no bearing on your decision to purchase or not purchase the insurance. Obviously, this is a personal risk tolerance issue and can't be answered by any but OP. But things we can all agree on:

* No one has ever used the title insurance with a direct purchase that we know of
* The possibility of any one person needing the insurance is well less than 1% and probably less than 0.01%
* The cost of the insurance compared to the cost of the contract should have no bearing on the purchase of the insurance

The justification for me is that spending $187 to protect issues against my 53k purchase for 100% guarantee I don’t have to worry about issues was well worth it.

So, I don’t agree that the cost of the purchase is irrelevant. I would not spend $187 to cover something that I can just replace for $200…

Again, personal choice but to me, it was worth the peace of mind, no matter how small the likelihood is I need it.

 

[rubybutt]

Are they obligated to the full amount over any issue? Like say one name was spelled wrong on an owner’s direct DVC contract. Does the title insurance have a choice to fix the issue rather than buy back the entire contract minus closing fees and interest?

I think you know the answer, but just so everyone else does too. What Genie is pointing out is that you aren't protecting tens of thousands of dollars, typically. You are protecting hundreds of dollars to correct clerical errors. And even that no one has ever used.

 

[Sandisw]

I think you know the answer, but just so everyone else does too. What Genie is pointing out is that you aren't protecting tens of thousands of dollars. You are protecting hundreds of dollars to correct clerical errors. And even that no one has ever used.

How do you know it would only be a few hundred dollars to correct an issue? Maybe a lawyer needs to be involved.

You said it yourself, the only way you know you are 100% covered against future issues is to have the insurance…

If someone sees it as a waste of money, they can certainly opt out…we did not.

 

[CamillaF]

Can you explain to me what Title Insurance does? I waived it but now having second thoughts. The CM I was just talking to said if I went to resell later down the line, I have to disclose that I don't have title insurance and it could be problems because new person won't be able to buy it. That doesn't make sense to me because when buying a house, you always buy title insurance to see who owns it. Do I need title insurance for later if reselling?

I would always have title insurance. I have come across bad surveys in which the map and legal description does not match. In fact this is not that uncommon and a simple mistake a person can make. With the tension between Disney and the Board I would make sure title insurance is there. You never know what weird title things will come up that were never intended. Title insurance pays for the legal fees and or makes you whole if something comes up.

Fun story- The mayor of Seattle in the 1920's decided to lease the water front at the end of roads for a 100 years. Her thinking was that Seattle would want it's water front back in 100 years. However the leases were lost and people sold the land, built houses, and those were sold again. A citizen going through the archives found the lease and it's been a mess for the tile companies ever since. I believe they have settled with the City and we are getting a new park out of the deal.

 

[thelionqueen]

Would you give a stranger $200 just because you spent $45,000? Just because it isn't that much? Every purchase should be weighed for its benefits. If you have to use the title insurance with a direct purchase, A LOT has to have gone wrong that Disney won't correct themselves. Has ANYONE here EVER used their title insurance with a direct purchase? Serious question.

Perfect written as to how I feel about it as well

 

[Sykes]

I don’t bother with title insurance on direct sales. I’m willing to self-insure against the 0.01% chance (probably really less than that) that I’ll need to spend a few thousand dollars to correct a clerical error on Disney’s part where for some reason Disney is unwilling to accept financial responsibility for their mistake. The chance that I’d lose the full purchase price without recourse when the seller is Disney is infinitesimally small (basically zero, but in this apocalypse where Disney goes away my 1/10th of a percent of a hotel room in central Florida swamp is worthless anyway).

I always get title insurance for resales, and most other real estate transactions.

 

[davidhr]

I love how these threads start with a very simple question and always end with people telling others how they’re spending their money wrong

 

[thelionqueen]

I love how these threads start with a very simple question and always end with people telling others how they’re spending their money wrong

I don’t see it this way at all. It’s simply different ways of looking at something. I don’t see anyone dictating to others that their way is right or wrong

 

[DonMacGregor]

I love how these threads start with a very simple question and always end with people telling others how they’re spending their money wrong

Correction, "giving their money to strangers". Please keep up...

 

[Genie+]

Well… we very rarely gamble or buy lottery and my husband with his lifelong best friend went in together for Megamillions Powerball over the last 2 drawings. DH spent $200 got back $35. I wonder if that was better or worse use of our waived $187 title insurance

 

[Robbie Cottam]

Are they obligated to the full amount over any issue? Like say one name was spelled wrong on an owner’s direct DVC contract. Does the title insurance have a choice to fix the issue rather than buy back the entire contract minus closing fees and interest?

They are obligated to cure all Defects in the title….

I don’t buy DVC to get out of it later….
And I buy title insurance so the attorneys fees to fix a defect are on them and not me

 

[Genie+]

They are obligated to cure all Defects in the title….

I don’t buy DVC to get out of it later….
And I buy title insurance so the attorneys fees to fix a defect are on them and not me

Right, a different proposition than
“obligated to give me 45,000 dollars back if ANY title issues came up, ever.”

 

[Robbie Cottam]

Right, a different proposition than
“obligated to give me 45,000 dollars back if ANY title issues came up, ever.”

Yep, you are correct,
However, the title insurance company is required to provide me a clear title…. If that requires an hour of my attorneys time I’m 400 dollars ahead of the game….

The the deed cannot in fact be corrected then the title insurance company would be on the hook for the entire 45,000….

I know how to trace a deed it would take me about an hour….. by paying a title insurance company to do it I’m 200 dollars a head of the game….

If you feel the risk is so small that 187 dollars is to much money….. great

My time is worth too much, and paying the title insurance company to research the deed alone is worth $187 dollars or 500 dollar….

I guessing you don’t value you your time like I value mine

Also that statement you quoted and ran with was based off giving a random stranger 187 dollars………

Not directly related to title insurance …. Just to keep the record straight

 

[Genie+]

If you feel the risk is so small that 187 dollars is to much money….. great

My time is worth too much, and paying the title insurance company to research the deed alone is worth $187 dollars or 500 dollar….

I guessing you don’t value you your time like I value mine

I never said any of this. If you look at my posts I have been consistent in saying it is a personal choice.

The “obligated to give me 45,000 dollars back if ANY title issues came up, ever” Statement needed to be clarified so other readers would not be confused as to what title insurance covers.

 

[Robbie Cottam]

Yep, you are correct,
However, the title insurance company is required to provide me a clear title…. If that requires an hour of my attorneys time I’m 400 dollars ahead of the game….

The the deed cannot in fact be corrected then the title insurance company would be on the hook for the entire 45,000….

I know how to trace a deed it would take me about an hour….. by paying a title insurance company to do it I’m 200 dollars a head of the game….

If you feel the risk is so small that 187 dollars is to much money….. great

My time is worth too much, and paying the title insurance company to research the deed alone is worth $187 dollars or 500 dollar….

I guessing you don’t value you your time like I value mine

I never said any of this. If you look at my posts I have been consistent in saying it is a personal choice.

The “obligated to give me 45,000 dollars back if ANY title issues came up, ever” Statement needed to be clarified so other readers would not be confused as to what title insurance covers.

Again, that was in direct response to the statement about giving random stranger free money….

 

[Gizmo74]

I don’t recall getting anything from the title company from my first Direct buy saying it was good to go. Does title insurance come into play when they can’t put title in your name after purchase? I would think main part is making sure names are how you want them on the correct before signing if you trusting Disney selling a clean title.

 

[Robbie Cottam]

I don’t recall getting anything from the title company from my first Direct buy saying it was good to go. Does title insurance come into play when they can’t put title in your name after purchase? I would think main part is making sure names are how you want them on the correct before signing if you trusting Disney selling a clean title.

title insurance comes into play when there is a defect in the title....

However, in order to issue the title insurance in the first place the company needs to do a title search and guarantee that the titles is in fact free and clear. They also have to review the deed to make sure that it is also free of defects....