Do you buy title insurance policy on quick flip properties?

[Ruth Lyons]

Looking for input from the bigger pockets family. I am closing on a flip next Friday. It 's a wholesale deal/assignment contract. The home has been owned by the same couple for over 25 years. A title policy will cost me $1,325 and I'll only going to own the home for 8-9 weeks since it's a quick flip. Would you purchase it or take a chance?

[Adrien C.]

You shouldn't even be asking this question. It's like all insurance. We hate paying it and never using it. Feels like a waste of money. But you love it when you need it. The risk isn't worth it. A title claim could be several thousands of dollars. Is it worth saving $1,325 and maybe taking on a claim of $60-80K or more. Even if they owned it years, the title company may miss something and it's on you to cover it. Maybe they miss a $150K IRS lien. That $1325 policy that shifts the risk to the title insurer is looking pretty good. Treat it as a cost of doing business. I don't say this lightly. I buy and sell 80-100 houses a year and half of those are wholesale deals (we close first) that have a turnaround time of 2 weeks. I always buy title insurance.