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Stewart Title Rate Calculator

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When buying a property or refinancing, one essential step is getting title insurance. This insurance protects you and the lender from any legal issues that might arise from the property’s title. To help estimate the cost of this insurance, the Stewart Title Rate Calculator comes into play. This tool is designed to simplify the process of calculating your potential title insurance premium based on a few key pieces of information about the property transaction.

Purpose and Functionality

The purpose of the Stewart Title Rate Calculator is to provide property buyers, sellers, and financiers with an easy way to estimate the cost of title insurance before closing a deal. Title insurance premiums can vary based on several factors, including the property’s purchase price and the coverage amount. The calculator uses a specific formula to determine these costs quickly and efficiently.

The Formula Explained

The general formula used by the calculator to determine the title insurance premium is as follows:

Title Insurance Premium = Base Rate + ((Property Price – Base Price) × Rate per Thousand)

  • Base Rate (BR): This is the starting fee for the insurance, covering up to a certain amount of the property value.
  • Property Price (PP): The total purchase price of the property or the amount of the loan.
  • Base Price (BP): The value up to which the base rate applies.
  • Rate per Thousand (RT): This is the additional cost per thousand dollars of coverage above the base price.

Step-by-Step Example

Let’s say you’re buying a house for $200,000. The base rate for title insurance up to $100,000 (the base price) is $500. For every thousand dollars above this base price, an additional $5 is charged.

  1. Calculate the excess over base price: $200,000 (property price) – $100,000 (base price) = $100,000.
  2. Determine the additional premium: $100,000 / $1,000 = 100; then, 100 × $5 = $500.
  3. Total title insurance premium: $500 (base rate) + $500 (additional premium) = $1,000.

Relevant Information Table

ComponentDescription
Base Rate (BR)Fixed starting rate for initial coverage amount.
Property Price (PP)Total value of the property or loan amount.
Base Price (BP)Coverage amount up to which the base rate applies.
Rate per Thousand (RT)Cost of insurance for each thousand dollars above the base price.

Conclusion

The Stewart Title Rate Calculator is a valuable tool for anyone involved in property transactions. It simplifies estimating the cost of title insurance, making it easier for buyers, sellers, and financiers to budget for this necessary expense. By providing a clear formula and requiring only a few pieces of information, the calculator demystifies the process of calculating title insurance premiums. With this tool, you can quickly understand potential costs, helping to streamline the closing process and ensure that all parties are well-informed.

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