Need for escrow

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Original Message:

Re: Need for escrow (by Beck):

karik27 wrote:
... TITLE POLICIES WILL GUARANTEE ANY UNDISCOVERED LIENS, ENCUMBRANCES OR TITLE PROBLEMS. A CLOSING COMPANY CAN'T DO THIS...

Closing companies have always fixed title problems for me without charging an additional fee. While they have many deficiencies, so do Title and Escrow companies. IN FACT, Summit Title has so many disclaimers and indemnity docs to sign if you don't pay for title insurance I say they are worse than a closing company for service and assurances. They are also excessively slow.

The cost of Title Insurance Policies are relatively very expensive when buying a timeshare. Perhaps if you are buying a $10,000 to $80,000 timeshare and you are the type who wants all the protection you can get, title insurance is good to buy. But when buying a $1 to $4,000 timeshare and the title policy is $500 in addition to the title/escrow service of $500-$1,000, I suggest your money is better spent on other things in life.

Timeshare closing companies process timeshares as timeshares. I don't care to use them, but they do a good basic job, cost a lot less than Title and Escrow companies, and when they do something incorrectly or a task was ommitted they have always fixed oversites in regard to proper deeding, maintenance payments, etc. Paying more for a Title and Escrow company to process your timeshare like a house, subjecting you to documents which are not directly applicable, requiring you to sign waivers/indemnities which remove a lot of their responsibility if you don't pay for title insurance, is less than optimal.

While there is a risk of not receiving clean ownership, the nature of timeshares is different enough that title insurance is probably not neccessary. Your timeshare doesn't need title insurance to protect you against incorrect property lines. The HOA/resort you belong to should already have that type of protection. Title insurance will not protect you from your HOA/resort declaring bankruptcy. The two largest risks are proper transfer of ownership and liens. As I've already said, the standard closing companies not only process this well, when they make an error they fix it.