How much is title insurance on a $2mil Commercial MF?

Question

Hi BP,

This is a question for any investors who are familiar with the closing costs associated with commercial multifamily purchases; that or title attorneys.

I would like to know what a ballpark figure would be for title insurance on a $1mil , $2mil and $5mil commercial multifamily property? I understand that it will probably depend on a lot of other factors that I'm leaving out of this question, but for hard and fast calculations, what do you think?

As a residential agent, I know for my area the formula is $500 per $100k purchase price.

Thank you!

Ryan Seib · Answer

The rates should be published in most states according to the department of insurance. Title insurance is regulated by the same governmental agency that regulates life insurance, disability insurance, etc. So they have filed rates, usually within a min-max range. The rate is usually a schedule based on purchase price. So it looks like x for the first $x, + x per dollar for the next $x, etc until you get to your property value. In Wisconsin the policy charge on a $2M would be something like $2300 I believe. That is just the policy rate though. It does not include search fees, endorsements if needed, closing costs, deed preparation and recording, etc. But yes as others have noted a call to a title company or two should clear up your total estimated charges for a specific deal ahead of time. Best wishes!

Yonah Weiss · Answer

@Jordan Archer most states have standardized rates, and you can actually check those out on most title underwriter websites by entering a few pieces of data for example First American
https://facc.firstam.com/?SSID=0.86074649442366

Jordan Archer · Answer

@Ryan Seib and @Yonah Weiss

Thanks  a lot guys. I was hoping there would be some kind of standard rate. Really appreciate it!

Jordan Archer · Answer

@Karen Margrave

Thanks for the motivational push.

So to follow up, I was looking for title insurance in Texas, and because title insurance rates are statewide (at least in TX) the answer to my question is as follows:

For a $1mil purchase , $5,575 - owner’s title policy premium Plus $1115 if you order aSurvey, T19 (mineral survey) and endorsementsFor a $2mil purchase: $9,905 - owner's title policy premiumPlus $1,981 if you order a Survey, T19 (mineral survey) and endorsementsFor a $5mil purchase: $22,895 - owner's title policy premiumPlus $4, 579 if you order a Survey, T19 (mineral survey) and endorsements

Karen Margrave · Answer

Call your local title company and ask them. Why guess when you can get real numbers from someone in your market?

How much is title insurance on a $2mil Commercial MF?

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