In a typical home sale, the party who pays for the owner’s title insurance policy is the one who chooses the title company, so whether the buyer or the seller picks depends on local custom and what the purchase agreement says. Federal law adds one firm limit: when the buyer is paying for the policy and the transaction involves a mortgage, the seller cannot require the buyer to use a specific title company as a condition of the sale.1Office of the Law Revision Counsel. 12 USC 2608 – Title Companies; Liability of Seller
Whoever Pays Usually Picks
Across much of the country, the rule of thumb is simple: the party writing the check for the owner’s title insurance policy chooses the company that issues it. In regions where sellers customarily pay, the listing agent often names a preferred title company before the home is even listed. In regions where buyers pay, the buyer’s agent writes the choice into the offer.
These customs vary state to state and sometimes county to county. They carry no legal weight on their own. They’re the default that most transactions follow because it’s the path of least resistance, and either party can push back during negotiations.
The Purchase Agreement Is What Actually Controls
Whatever the local tradition, the purchase agreement is the document that governs. This contract spells out who selects the title company and who pays for each title-related cost, including the owner’s title insurance premium, the lender’s policy premium, the title search fee, and the settlement or closing fee. Once both parties sign, those terms are binding.
So the time to assert your preference is before signing. If you’re the buyer, name your preferred title company in your initial offer. If you’re the seller, your agent can specify one when listing the property or counter the buyer’s choice during negotiations. Don’t assume the other side’s suggestion is final just because it appeared first on paper.
What Federal Law Says About Forcing the Choice
The Real Estate Settlement Procedures Act sets the outer boundary. Under Section 9 of RESPA, a seller cannot require a buyer to purchase title insurance from any particular title company as a condition of the sale when the transaction involves a federally related mortgage loan.1Office of the Law Revision Counsel. 12 USC 2608 – Title Companies; Liability of Seller That category covers virtually every residential mortgage, including purchase loans, refinances, second liens, adjustable-rate mortgages, and reverse mortgages.
The prohibition reaches both direct and indirect pressure. A seller who says “use my title company or the deal is off” violates the statute, and so does a seller who buries the same requirement in contract language that leaves the buyer no real alternative. A buyer who is forced to buy title insurance from a specific company can sue and recover three times all charges paid for the title insurance.1Office of the Law Revision Counsel. 12 USC 2608 – Title Companies; Liability of Seller
When the Seller Is Paying
Section 9 prohibits a seller from requiring the buyer to purchase title insurance from a specific company. When the seller is the one paying for the owner’s policy, the buyer isn’t purchasing anything, and the prohibition doesn’t apply. In seller-pay areas, the seller can legitimately insist on a specific title company for the owner’s policy. The buyer still keeps full control over the lender’s title insurance policy in those areas, because the buyer is the one paying for that.
Cash Deals
Section 9 only applies when a federally related mortgage loan is involved. In an all-cash transaction with no lender, RESPA doesn’t govern the title company selection. Buyer and seller are free to negotiate the choice however they want, and a seller can condition the sale on a preferred company without triggering federal penalties.
Two Policies, Two Choices
Most transactions involve two separate title insurance policies, and different parties may pay for each one. The lender’s policy protects only the mortgage lender’s financial interest in the property. Almost every lender requires it, and the buyer typically pays for it. The owner’s policy protects the buyer’s equity in the home and is optional but strongly recommended, since without it a title problem could wipe out the buyer’s investment while the lender walks away protected.2Consumer Financial Protection Bureau. What Is Lender’s Title Insurance?
Who pays for the owner’s policy is the biggest factor in who picks the title company, because that’s the larger premium and the one tied to regional custom. The lender’s policy is almost always the buyer’s expense regardless of location, which is why buyers retain the right to shop for the lender’s policy even in seller-pay markets.
The Lender Has a Say Too
Even after buyer and seller settle the question between themselves, the mortgage lender adds a layer. Lenders don’t accept every title company for the lender’s policy. Your lender must give you a written list of settlement service providers you can choose from, and you can also select a company not on that list if the lender agrees to work with them.3Consumer Financial Protection Bureau. Shop for Title Insurance and Other Closing Services
Most lenders will work with any licensed title company that meets their underwriting standards. If you’ve picked a small or unfamiliar company, expect the lender to verify its credentials before approving it, which can slow the closing timeline.
When a Real Estate Agent or Lender Recommends a Title Company
Real estate agents, mortgage lenders, and homebuilders sometimes have an ownership stake in the title company they suggest. These setups are called affiliated business arrangements, and they’re legal under RESPA if three conditions are met: you get a written disclosure explaining the financial relationship and estimated charges, you’re never required to use the affiliated company, and the only thing exchanged for the referral is a return on the ownership interest itself rather than a fee tied to referral volume.4eCFR. 12 CFR 1024.15 – Affiliated Business Arrangements
The disclosure must come on a separate piece of paper at or before the time of the referral.4eCFR. 12 CFR 1024.15 – Affiliated Business Arrangements If an agent casually says “we usually use XYZ Title” and hands you nothing in writing, that’s a red flag. Subtle pressure such as telling you the affiliate will “speed things up” or presenting it as the only realistic option can violate RESPA’s anti-kickback rules.5Office of the Law Revision Counsel. 12 USC 2607 – Prohibition Against Kickbacks and Unearned Fees
None of this means affiliated title companies are a bad choice. Some are competitive on price and service. The point is to treat the recommendation the same way you’d treat any other: get the disclosure, compare it against an independent quote, and decide for yourself.
Negotiating the Choice
The title company selection is a negotiable term. Where the leverage sits depends on who’s paying.
If you’re the buyer and you’re in a buyer-pay area, you’re in the strongest position. Name the company in your offer, and there’s little reason for the seller to object. In a seller-pay area, you can still request a different company, but expect pushback since the seller is paying and the law gives them the right to choose. A reasonable compromise: let the seller pick the company for the owner’s policy while you select the company for the lender’s policy.
If you’re the seller, offering to cover title insurance costs (or part of them) gives you more control over which company handles the closing. In competitive markets, some sellers make their preferred title company a non-negotiable term and buyers accept it to keep their offer attractive.
Whatever your reason for wanting a specific company, prior relationship, faster turnaround, lower fees, raise it early. Trying to switch title companies after signing creates friction that neither party wants.
When You Can’t Agree: Split Closings
If buyer and seller can’t agree on a single title company, they can each hire their own. This is called a split closing. Each company runs its own title search, prepares its client’s documents, and coordinates with the other to exchange title commitments, funding details, and closing instructions. The seller’s side typically handles payoffs, prorations, and the deed, while the buyer’s side works with the lender and manages fund disbursement.
Split closings don’t necessarily cost more, since title companies in many markets charge the same fees either way. The real trade-off is coordination. With two companies involved, document or funding delays can push back the closing date, so build in a few extra days of buffer.
Cutting the Cost Once You’ve Chosen
Whichever side you’re on, the company you choose affects what you pay. A few strategies bring the cost down.
Ask about a simultaneous issue rate. When you buy both an owner’s and lender’s policy from the same title company at the same time, most insurers offer a bundled rate that’s significantly less than buying them separately. If you’re getting a mortgage and want owner’s coverage, buying both from one company is almost always cheaper.
Ask about a reissue rate. If the property was recently purchased or refinanced and the seller still has their title insurance policy, some insurers will issue a new policy at a discounted reissue rate. Eligibility varies by company and state, so ask directly whether a prior policy exists and whether it qualifies.
Get more than one quote. Title insurance premiums are regulated in some states, meaning every company charges the same rate. In states without rate regulation, premiums and fees can vary substantially. Even in regulated states, service fees such as search fees, closing fees, and courier charges aren’t always fixed. Two or three quotes take minimal effort and can save hundreds of dollars. Your lender is required to identify which settlement services you’re allowed to shop for on your Loan Estimate, and title insurance is almost always on that list.3Consumer Financial Protection Bureau. Shop for Title Insurance and Other Closing Services