What Explains Variation in Title Charges? A Study of Five Large Markets

Title charges include title insurance premiums and charges for settling a loan. Title charges vary considerably from a median of $1,971 in California to $625 in North Dakota. This report analyzes variation in settlement costs using data from over 3,000 FHA-insured, 30-year fixed-rate home purchase loans in five metropolitan areas. Even after controlling for metropolitan area, various characteristics of homebuyers, houses, neighborhoods, and settlement agencies, more than one-half of the variation in title charges remains unexplained. Substantial differences in title charges between settlement agents within a market suggest that consumers would benefit by shopping for settlement services.

Keywords: Economy/Taxes, Housing, Race/Ethnicity/Gender

Suggested Citation: Suggested Citation

Feinberg, Robert M. and Kuehn, Daniel and McKernan, Signe-Mary and Wissoker, Doug and Zhang, Sisi, What Explains Variation in Title Charges? A Study of Five Large Markets (June 1, 2012). U.S. Department of Housing and Urban Development, Office of Policy Development and Research, June 2012, Available at SSRN: https://ssrn.com/abstract=2205724 or http://dx.doi.org/10.2139/ssrn.2205724