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    North of NYC North of NYC By Houlihan Lawrence By Houlihan Lawrence by

    Thoroughbred TitleWith the residential real estate market in it's current state, now is a good time to take another look at both the Market Value Rider and the Extended Protection Owner’s Policy. Both offer benefits to the purchaser of a 1-4 family residential property and are available through Thoroughbred Title Services.

    Market Value Rider
    Simply stated, the Market Value Rider offers the purchaser the opportunity to enhance their title coverage. If there is ever a claim on their title the purchaser is covered up to the fair market value of the property at the time the claim is made. A standard title policy only covers purchaser up to the amount they paid at closing. Obviously, as prices have come down there is a chance that this could come into play. The Market Value Rider is available for a one-time charge (10 % of the Owner's Title Insurance Premium) payable at closing (there are no yearly premiums or renewals). On an $850,000 purchase the Market Value Rider would cost $299.

    Extended Protection Policy
    The Extended Protection Owner’s Policy is available for a 20% increase over the standard Owner's Policy premium. This policy actually covers purchaser for certain acts of fraud that occur post-closing. Standard title policies only cover the purchaser for things that occurred prior to closing or at the closing itself. The Extended Protection Owner’s Policy also has a built in partial Market Value Rider, which gives the owner enhanced coverage for the first five years of ownership (when most claims occur). Also, it covers some issues that can arise at the Building Department that standard title policies do not insure.

    Here are some of the highlights and conditions of each of these products:

    Market Value Rider

    • Covers purchaser for full market value (minus any improvements made after purchase) at time of loss
    • Available for a 1-4 family home used predominantly for residential purposes
    • Purchaser must be a natural person and must reside at the premises
    • Available for Condos and Co-op Units
    • Cost is 10% of the Fee Policy Premium

    Extended Protection Policy

    • Has "built in" partial market value rider: coverage automatically increases 10% a year for 5 years.
    • Protects against fraud or forgery that occurs after the date of closing. Title Company would cover cost of setting aside fraudulent deed or mortgage
    • Covers violations of zoning and local building laws that result in a forced removal of a structure, including decks, garages, extensions, etc.
    • Guarantees vehicular access to and from the premises (standard policy only guarantees pedestrian access)
    • Premium is 20% higher than standard Owner's Policy