is Title Insurance?
Title Insurance, in its most
basic definition in regards to timeshares, is optional insurance for
the buyer of a timeshare to protect them against financial loss due to
title defects, undeclared liens, or other matters that could interrupt
or impact the transfer of ownership of a timeshare title between two
timeshare industry is ripe with people that are desperate to sell, and
entities that are more than happy to help them. The problem
is that many of these organizations are not properly licensed to deal
with real estate matters, and subsequently do not follow the proper
procedures in regards to the transfer of ownership of a deeded
timeshare properties between buyer and seller. This has
resulted in an overwhelming number of issues with the actual transfer
of the title at the resort level. When title insurance is not
purchased, the buyer is completely unprotected should something
"unexpected" turn up such as:
While I am
not saying that the average timeshare transaction encounters these
issues, it is frequent enough to certainly be mentioned as a warning to
ALL potential timeshare buyers in the resale market. Title
insurance can be a cheap way to protect your investment and money spent
to purchase the timeshare should any of the above happen during your
- unpaid liens
- back taxes owed
- overdue maint. fees
- title/deed defects
is covered by Title Insurance?
insurance only protects you up to your purchase price of the timeshare,
and does not generally cover closing costs incurred. However
like all insurance, you should read over the policy and details before
you decide on anything!
does Title Insurance Cost?
insurance can range from $200 to $500 dollars, depending on the amount
being insured. It is important to note that many
timeshares on the resale market are often below this price.
Some common sense should be used in this area, especially if
you are buying a timeshare for a single $1, paying hundreds of dollars
to insure a single dollar might be a bit ridiculous!
Do I need
Title insurance as a seller?
the most common scams in the industry today is the upfront fee company
contacting SELLERS claiming they have a buyer waiting, but require them
to fork over a huge fee for a "title search" or "title insurance".
Again, common sense should apply, as title insurance and a
title search is basically providing insurance that what YOU are selling
belongs to you, doesn't have an outstanding lien against it, doesn't owe
any back taxes, isn't delinquent in maint. fees, etc etc. If
you are the actual owner of this property, this information is
something you (should anyway) already know! I personally
wouldn't pay someone money to confirm I wast the owner of my own
timeshare! Should the buyer choose to purchase title
insurance, that is their right...however as a seller it is certainly
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!
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
The Final Word!
really comes down
to how much you want to spend to protect your purchase price investment
on a timeshare. If you are spending a great deal of money,
title insurance is certainly a wise choice, however given the extreme
depression of the resale market today with many if not most timeshares
selling for between 1 and 25% of their original purchase price, title
insurance may exceed the sale price of the timeshare itself.
In these cases, economic common sense says that if your $1
timeshare turns out to have something wrong with it, just
call the $1 a lesson learned and move on to the next sale!
Feel free to stop by our Timeshare Online Community Forums
want to ask specific questions, with more than 65,000 other Timeshare
owners and experts, no question goes unanswered!